Bitcoin: Did You Miss $40K?

It’s a bitcoin bull market – and I have trader friends making hundreds of thousands of dollars without me!

As St. Paul Research’s resident “bull market genius” over the years, I truly believe optimism wins. The scoreboard certainly says so – look no farther than my extensive track record!

I’ve reminded you time and again to “buy, buy, buy!” during the post-pandemic market melt up – never once trying to outsmart the stock market surge.

But that doesn’t mean I don’t have any regrets. Reviewing my trades from 2020, one regret is not believing enough to buy into Bitcoin, despite the fact that all my trading experience pointed to a significant mania similar to the dot-com boom of the turn on the century.

My mantra of trading anything, anytime, in any direction was derailed by liquidity limitations to controlling risk in Bitcoin. First, the required safety of trading on an exchange eliminating counterparty risk was only recently eliminated with CME group futures. Also, the mostly no shorting rule by brokers and option inefficiency have held me back…

Trade for tomorrow is a theme I was taught, and future days will always offer more opportunities instead of forcing myself into a market gamble.

Just remember – missing out on crypto didn’t cost any money. We’re in a bull market. Opportunities abound!

Keep it In the Money,

Alan Knuckman

Alan Knuckman
Editor, In-The-Money

Trading Tip of the Day: Stay vigilant in a frothy market

Greg Guenthner

I’m seeing plenty of fast-moving breakouts flash across my screen to kick off the new year. Bitcoin rampaged higher last week. Tesla stock exploded toward $900, helping Elon Musk become the new richest man in the world. It certainly feels frothy out there…

Don’t get me wrong – I’m not bearish!

But it’s important to remember that stocks that go parabolic do not correct sideways.

When you see a stock moving into extremely overbought territory and posting a chart that starts to look like a hockey stick, you expect a sharp reversal to appear at some point as too many traders race for the exits with whatever profits they can carry…

Of course, there’s nothing wrong with trying to play a stock that’s screaming higher. But it’s important that you learn to recognize the signs of a stock that’s gone vertical. If you aren’t in these plays for the long haul, it’s best to remain aggressive when taking profits. You’ll rarely nail the top — but you will save yourself a lot of pain (and money) by taking gains off the table early and often.

All good things must come to an end. Eventually, the momentum crowd always abandons these sweetheart plays for the next hot ticket…

— Greg Guenthner

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Alan Knuckman

Alan hails from the home of options trading in Chicago, where he began working as a clerk on the floor of the Chicago Board of Trade (CBOT). Beginning with his days on the floor, Alan’s worked with all aspects of the options markets for the past 25+ years.

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