TSOT- Brief Structure of a Digital Currency Portfolio

Preparing for the Next Turn!

With Grayscale Investment Trust Fund recent February launch of its 'Diversified Digital Large Cap Fund' (DLCF), accredited investors would be able to gain access to get a deeper exposure to its weighted components in a more professional manner of investment criteria.

DIGITAL ASSET HOLDING Price / Share as of June 22, 2018 is at
$5.83 Net Day change of -6.87% Source Grayscale 

Here are the components market cap weighted percentage distribution in the fund where their Rebalancing schedule are on a Quarterly basis. This is based as of May 31, 2018

#BITCOIN - BTC - 55.2%  #ETHER   - ETH - 24.2% 

#RIPPLE  - XRP - 10.4%   #BITCASH - BCH -  7.4%

#LITECOIN- LTC -  2.9%

These components and their respective weightings would be quite useful in structuring our exposure to each or a selected group of Digital asset class both in CASH & FUTURES market. A strategic combination of asset class would be determined by monitoring 'Price Action' on the Bitcoin market as it carries a bigger weight / percentage in the basket fund of digital currency. However, the initial structure would concentrate more towards the DLCF and pre-determined individual funds including our 1st GBTC based from our reference information below. 

The approach is similar to the overall components of the original USD Index (DXY), with relative comparison to JP Morgan Asian USD Index (ADXY) and Bloomberg USD Index (BBDXY). This may seem to be a bit complex for others not accustomed to the strategies, as it involves a certain degree of process which MegaTrade101 has timelessly applied with Spot FX, Futures, Options and ETFs markets, which have been quite effective so far since then by using CIPHER3 Analysis Others may view the complexity of the process, but this is where it all started from and eventually turned into our core strength in trading.

With the recent 2017 launch of Bitcoin Futures by both the CBOE and CME, we are now gearing up to speed on combining these methods in a pre-selected venue. Now that the top digital currency assets are tradeable in a variety of funds it would be time to re-apply its viability. Their respective price and percentage differentials have always been our key asset in determining their imbalances similar to the foreign exchange market. 

For now, we would simply share this brief information, as we structure the portfolio based on this premise to start with. As we all know that the Digital Currency market have been experiencing a remarkable decline and the current pressures are yet to be ironed out in the market. 

Reference Information:

BTCUSD Alternative Trade Strategy

Digital Currency Finds Relative VALUE as an Alternative Investment

After the Fact: Volumes Surge Pushes Bitcoin above 8000 

BEST & WORST for BITCOIN is OVER, For Now!

It's been barely two months since both the CBOE and CME have engaged in the Bitcoin exchanges. While we've probably seen the initial highs marked near the 20k levels and a secondary near 17200, it is a fair assessment that these highs can now be called good price reference on the high side.

Meanwhile, aside from where all these prices came from, the rapid decline from these highs have made it clear that the first low near 9020 and the secondary low marked at 5870 low likewise serves as the initial base price to consider. The wide range established between its high and low simply means that the price action on Bitcoin price swings may well still be in triple digits in both directions. Substantial enough for speculative day traders out for a quick bite of the market but not excempted from the risk of loss at the same time.

Observing preice movement and market behavior since the two major exchanges opened and how well the prices of bitcoin have remarkably been well tamed from where volatility kicked off a couple of years ago. In simple terms, the hot market have cooled off with both exchanges participation have dramatically paved the way for much of the oderly transactions that we see today. But not without a price to pay, as we see the price of bitcoin has been sliced to more than half of the range it has to day.

Although, the price range between 8k and 12k could well be considered a fairly priced level of transactions as it navigates itself for a long period of consolidation. It so happens that the length of time that Bitcoin would have to narrow that wide gap until such time it can break out of the consolidation phase. The random price swings can go in both direction, but at least with a short price reference slightly over a month could still prove to be a good reference for short term trades based on its technical perspective. Don't expect to make the same type of returns it once had. Even the way that GBTC already did a split 91-1 that would not give the same levels.

Choosing between classic or Futures trading on bit coin would really depend on investor / traders goals and objectives. As both carry a higher degree of risk and capital to start with regardless leverage or not, the risk involves a higher degree of loss with an equivalent reward at stake as well.

For those who have already been holding on to whatever amount or price of bitcoin then, consider futures market as a strategy to protect the holdings against any adverse future price fluctuations. And simply make use of whatever available methods the market has to offer to enhance and improve your portfolio or trade positions.

Be a smart tactical investor / trader and outmaneuver the market

at its own game. 

With CLASSIC, FUTURES and BLOCKCHAIN Relative ETFs Market it can only get better over time as the global market evolves around technology driven innovations continue to move forward.      

#CME Pulls its Muscle & Tame the ROAR of #BITCOIN Rally.

After CME's launch date on DEC.18 it has been quite a significant down hill pressure as evidence reflects in today's prices for #BITCOIN and its relative peers now trading below the 10k mark. Indeed, this is the way how #CME pulls its muscle and tame the roar of the rally.

Market Watch Reference:

 Bitcoin Trades below 10k 

Of course, it was easier said after the fact, but knowing how these institutional players takes action the level of difficulty against the CME traders is definitely in a scale of 10. We can now say that our 1st year anniversary gift was a welcome treat last Dec 16, 2016 on GBTC entry (published on Dec 27, 2016 Market call)  -to- Dec 16, 2017 Settlement date followed the plan has now been VALIDATED.

It does take a month after to be able to do so.

As a new low for the 1st of January have been made for now. 

BITCOIN Still in Search of New Record Highs

#BTCUSD price have marked a 6316.85 high on the 29th of October and so far is maintaining its stance reflecting a new search for a newer high. This is on top of a declining volume that has kept prices relatively high on good demand and positive market sentiments against contradicting statements made on wall street.

Price Update: At USD6571.00 As of Nov 1, 2017 

Price Update: As of Oct 31, 2017

Once #BTCUSD broke the 5000k mark with a significant move; it has entered a new phase where a new higher channel have been established that serves as the 2nd channel & compartmentalize its price action in search of newer record levels. And the 6316.85 proves that point.Meanwhile, the current price at 6550 is well on its way to our projected price range nearest to 6780.

Reference to Ideal Price Range Objective between 6250 - 6780

Related Information: 

CME Group Announces Plans to Launch BITCOIN Futures 

Bloomberg Chart that best describes BITCOIN rapid acceleration

ProShares Files for BITCOIN ETF and One to Bet Against It

This has been widely anticipated as #ProShares prepares alternatives ways for investors and traders alike to potentially carry a certain degree of manageable risk surrounding trading the digital currency. Its acceptance , though slowly building into a real global powerhouse as its block-chain technology backbone is now getting into important Fintech related industry levels and companies developing into the future.

 

CNBC: ProShares Files for Bitcoin ETF  

A well thought and planned addition and outright solution for the #Futures and #ETF market. If it can be done with the volatile #FX market so can it be made possible with #Bitcoin and its related financial instruments. Though it still take some time to get all things ready by then market landscape for digital currency would be widely accepted. Especially when these instruments would be traded in the US where regulatory requirements are well managed. Accredited and most sophisticated investors may well be the first ones to engage once all systems are a go. 

Likewise a welcome treat for us at MegaTrade101 as we facilitate and relate to the modernization of our clientele that would be provided a selective choice of instruments that would best fit while serving their respective objectives. The relevance of trading and investing in today's changing market conditions is important moving forward to aim for Alpha in spite of the global low rates eventually would change in the near future starting of with the US Federal Reserve.

Comparing Apples & Oranges - EPHE iShares MSCI Philippine ETF Tracking #PSEI

Comparing with the US EPHE iShares MSCI Philippine ETF, its YTD is marked at 10.33%, while its YOY so far as of today the 7.12.17 is still in negative territory at -8.81% quite some legs to its previous -3.60% last 6.05.17.

And the last time it was in positive territory was on the same month of July 18 2016 with a registered mark at 3.17%. That was when the PSEI marked a high at 7986 and continued to make its high between 8000 and above the 8130 levels. There is quite a percentage and price difference that the PSEI still needs to make up for.

So far so good!.... as for those who have started at the YTD levels trade positions on selected stocks are more positive than the rest. With today's market rally, expect the PSEI to continue in the US EPHE as it has been lagging behind the local index.

  For Technical traders, watch and anticipate how these bars would form as the current prices are well within its mid range HI/LO band. The 3rd quarter of the 2017 should provide some interesting market volatility that already have started in the first two weeks of July which should continue to move forward.

Summary on ASIAN MARKET ETFs

The PSEI 4.13% is still trailing behind global stocks even among its neighbors with China 8.55% and India leading the Asian Pacific Region with 12.69%. Note: Given the right conditions the PSEI has some room for improvement especially with the EEM and commodity prices are on the rise lately. The PSEI has enough room for improvement and is on a trail behind its peers.

MT101 ETF- Fund Exposure to date are as follows:
YTD

1. ishares MSCI China (FXI)

    8.55% 14.44

2. iShares MSCI Philippines (EPHE)

   4.13%  (4.34) last 6/12 months Divergent Trend Covered by US Equities Major Index NASDAQ (XLK link below) 

3. iShares MSCI India (INDY)

   12.69% 19.60

4. iShares MSCI Emerging Markets (EEM)

   8.57% 15.38
NOTE: EPHE has underperformed compared with the rest of the group. Not included in the list are our EUROPEAN ETFs as Majority of our trades are overweight in the US market in NASDAQ - Global Technology Fund

1st Quarter Strategy: USD, Equities, ETF & Foreign Currency Trading

Carry-over to 2nd Quarter Trading

The USD Index has always been the 'Core Strategic Instrument & Trade Strategy' applied in almost all our trade decisions, its correlation with the US & global major indices have played a vital role especially the 1st quarter trading positions for 2017. Once a focal price point has been established and proven valid through the test of time (DXH2017 settled before expiration), it would remain resilient until otherwise contradicted by price action and initiate alternative USD correlated instrument.

Ensuring a continuing trend direction a combination of Futures, Options and ETFs are vital for a sequence of trades that can best maximize market potential. A clear USD Bearish Fund UDN trade position prior to futures expiration would best suit the strategy. However, there are a lot of strategies accessible only for those who would do their respective due diligence.
      
With the three (3) most recent 'Correlated' market information chronologically listed, the components of the analysis have proven to be as effective until the market states otherwise. With the US Dollar Index (DXY) opening in the Asian trading session at 99.45 and marked a low at 99.25 was a direct end-result of a contagion from the US vote. A backdrop of the non-passage of the Healthcare bill that reflected negatively for the President's legislative powers over the GOP members that lacked the numbers to pass it through.

1st Quarter Strategy: USD, Equities, ETF & Foreign Currency Trading 

Directional Trend & Price Action Follow-through Confirmation

Breaking Dawn to Rise for the #NK225 Aligned #USDJPY and its Correlated ETF as an Effective Rolling Trade Strategy still active and in place to this point.

#Nikkei 225 @19042 high has been marked in the market, driving a strong move for the #USDJPY nearing the 115.50 target levels mentioned in our "CORRELATION STRATEGY" trading @115.22 to this writing. Meanwhile the ISHARES Currency Hedge Japan ETF (HEWJ) is already @28.30 from its breaking price point of 25.00. Thus all in line with our market call.

While this is also supported from a #USD price recovery after #ECB President Mario Draghi left rates unchanged with the exception to cut its bond-buying policy to 60B instead of the regular 80B which would likely be extended thereafter. This drove the #EURUSD now currently @1.0556 levels to this time in the US session.

Chart Overlay on Cloud: USDJPY, NK225, HEWJ,  https://www.tradingview.com/x/kFrYVPkw/

Alternate #ETFs Cross Trading Strategies with #Currency Market

While stocks indices have been in the range, two of the best #ETFs so far that has shown some promising potentials are relative to the currency markets. As these would well be in line particularly with the current strength and tone of the #USD.

Aside form our DX #futures contracts, the UUP #PowerShares DB have started to gain momentum @25.00 level from a slide @24.00  which may continue as  surrounding plays supporting a good rally on these markets is reflected. The consolidation period may have taken longer than usual, yet the market potential is clear as it defines the overall trajectory of the trend.

This goes the same way with the #iShares #Currency #Hedge MSCI Japan (HEWJ) as an arbitrary hedge for the USD strength that has now covered its full leg on the decline while a pivotal price recovery is already in place. The corresponding low on the #USDJPY @100.00 levels held equivalent to the #HEWJ @22.20 low and is currently trading above the 25.00 to this writing.

The correlation of these two instruments are well in line with the USD Index and USDJPY as an arbitrary play with and contrary to each other while waiting for stocks to make its break. Looking forward to the results of the #NFP figure would provide a good volatility reading on the closing activity. 

Related Information:
CORRELATED INDICES, ETFs & CURRENCY SRATEGIES