Why the Bitcoin Boom Can Keep Going
And up bitcoin goes again. This is really becoming something to behold.
Bitcoin was just over AU$6000 when we released our $20 Bitcoin Blueprint three weeks ago.
It’s now over AU$8000.
That’s no boast. I gave a time frame of two years for bitcoin to go over US$10,000.
It might just do it in 2 months.
I cannot recall something that has moved so high, and so fast, that still has so much potential in front of it.
That’s not to say you can’t lose money here. It’s still a high risk play. But every action in the financial world has risk.
That’s not the question. The actual question is always the same one: is the pay off worth the risk?
I still think bitcoin can prove a long term winner from today’s price.
There is so much development and talent pouring into the crypto market now.
And there’s one stock you simply must watch from here…
The bitcoin ‘hard fork’ still to come…but does it matter?
I wrote in our Bitcoin Blueprint report that I thought the uncertainty around the upcoming ‘hard fork’ in November could suppress the Bitcoin price.
That was an opportunity to accumulate bitcoin while it played out.
In hindsight, you had a small amount of time to act on that.
A ‘hard fork’, by the way, is when the blockchain underneath bitcoin splits in two.
Think of a railway track that comes to a junction and becomes two lines that keep going side by side.
Each is going in a new, and different direction.
But which track should you be on?
It appears community support seems to be falling away for the team that pressed for the hard fork. They’re the ones creating the new coin.
Time will tell us for sure.
Sceptics love to crow that bitcoin is a bubble. But what nobody can tell us is when the price run finishes for bitcoin, or for what reason.
It’s certainly shrugged off China banning the exchanges and the hard forks so far. These were two big risks.
Bitcoin can come down. As yet, I can’t see what the trigger might be.
It could happen tomorrow for all I know. But I doubt it. You just have to factor a wildcard in to your risk management.
How much are you prepared to lose if I’m wrong?
There are always calls saying something is going to crash or wipe you out.
These people like to think they’re doing you a service. I’m sure they have good intentions most of the time. However, all they usually do is spook you out of taking a position and cowering in fear.
US stocks keep making commentators look foolish
For example, for six years I’ve read that US stocks are only going higher because of low interest rates and central banks propping up the market.
Except last week proved how wrong these calls have been, and continue to be.
The major US tech stocks just announced fantastic results for their third quarter earnings.
Consider Amazon. It reported a 34% jump in sales. The stock rose 13% on the day.
Alphabet (Google) and Microsoft also beat their estimates. Tech stocks are killing it because they are fantastic businesses. Period.
And all eyes will soon turn to Nvidia [NASDAQ: NVDA]. It’s due to report its results on November 9.
I had Nvidia as a suggested stock to buy in my original Amazon Jackpot report that we released in late July. It was around US$160 back then.
It was an ‘unofficial’ recommendation because it’s not a small cap stock.
But the artificial intelligence trend driving it is so enormous I wanted to put it in front of subscribers.
Nvidia hit US$200 last week.
Part of that is an unexpected windfall and growth outlook for the company coming from cryptocurrencies.
The moat has widened on this business
The ‘miners’ who validate the crypto networks need powerful processing. Nvidia has the best chips in the business. So Nvidia is getting bid up as a play in crypto as well as on artificial intelligence, amongst other things.
That’s two enormous tailwinds.
Nvidia happens to have a competitor called Advanced Micro Devices [NASDAQ: AMD].
It’s already released its third quarter results – and fallen for three straight days.
Investors aren’t happy with its fourth quarter outlook.
That puts Nvidia in a very interesting position.
If its third quarter results smash the lights out, it might begin to look like the only game in town for both crypto and artificial intelligence. These trends have years to run.
It will be most interesting to see their numbers when they’re released.
There may be more potential upside here too.
You do need to tread carefully and know if you’re in for the long or short term.
US markets have not had a decent correction for a long time now.
There’s a sense one is ‘due’.
A bit of a panic in the market would be a good thing overall…to buy more great stocks at better prices!
Emotionally it’s never easy though.
Regardless, there is so much opportunity in the markets to make money. Consider we can all access most of it from a laptop too.
You’re crazy if you’re not excited by it. Get on board the opportunities here.
Editor, The Daily Reckoning Australia