"Sell in May and Go Away"

As we are headed into the low liquidity season of the year, markets are getting increasingly more indecisive. At this point, the optimism that has carried the uptrend is fading, and it is questionable if we will see any fireworks in the near term without a strong positive catalyst.

In short; the older trading saying “sell in may and go away” may actually serve us pretty well navigating the current market terrain.

Of course that could change any second - Especially if the catalyst everybody is waiting for should come. The long awaited Federal Reserve guided rate cut.

However, watching the press conference yesterday with Jerome Powell, I think it is safe to assume that there will be little development in that regard in the near term. We will just have to accept that rates stay “higher for longer” and track developments on a meeting-to-meeting basis for a change in attitude.

Bitcoin is going nowhere for the moment

At this point, it is clear that the ETF capital inflows have been guiding the Bitcoin uptrend since the beginning of the year. However, since mid-march, the inflows have dried up, and I don’t think we can expect any change in that regard before Bitcoin marches back up above the $70.000 price point. Institutions are simply not going to push a risk asset when the macro environment is so muddy.

Meanwhile, BTC is looking to close its fifth week in red. That can of course be interpreted negatively but from where I am sitting valuations are nearing in to where I would like to be a longer term buyer of Bitcoin.

Kind reminder: Bitcoin volatility is normal. All prior bull markets had several +20% drawdown periods.

Bitcoin is still leading the pack

Bitcoin’s outperformance of the general crypto market continues. In the wake of the liquidity being drawn from the markets, I think that trend is likely to continue. In fact, I wouldn’t be surprised if Bitcoin’s dominance would surpass 60% in the coming months. For this reason, I am sitting very comfortably in BTC for the majority of my liquid portfolio while spending most time assessing the early stage opportunities that land on my desk.

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