After another week of upside, Bitcoin just barely closed above our $80.5k old range low and closed at ~$80.6k. This is technically a reclaim of that old range low, but because it was so close, we want to see Bitcoin maintain above that level for confirmation. Bitcoin uptrends usually end with a violent pop to the upside so as long as we keep slowly grinding higher and climbing the wall of worry, I remain optimistic we still have higher to go before our next big correction.

Market sentiment remains neutral. I am quite surprised that sentiment has not become more elevated given this is the strongest and longest rally Bitcoin has experienced since the $126k all time high. It seems as though most investors are still in disbelief and are assuming the rally will end any day now. This is the exact sentiment backdrop we want to see for this rally to head higher.

The GLI just barely made a new high last week. We haven’t seen enough expansion to get too excited, but it is a good sign for what we can expect later in the year. Bitcoin continues to follow The GLI with a lag and we are entering a time period where The GLI is pointing towards some consolidation. What comes after that consolidation will come down to what The GLI does over the next few weeks.

We will be receiving an update to the most popular inflation metrics, CPI and Core CPI on Tuesday, May 12th. Investors will be watching this print very closely to see how the geopolitical situation and subsequent increase in energy prices is impacting prices throughout the economy. The market will use this print to adjust rate cut expectations as needed which will then impact the dollar, liquidity and risk assets. We really want this print to come in-line with expectations at 2.7% YoY. A hotter than expected print could spook markets.

Even after this recent rally, Bitcoin remains in the Cheap 🟢 region. I’d love to see this rally make it into Fair Value 🟡 before the next correction because that would likely result in a violent FOMO driven move higher, but we’ll have to wait and see. I also hope we get a chance to buy in the Very Cheap 🔵 region later this year, but I’m not sure we’ll get that chance. In the meantime, we can just patiently sit on our positions and wait to see what Bitcoin decides to do.

I trimmed some of my Bitcoin position into cash today. Not because I think it has to go down, but because that’s what my systems calls for. I am trying to keep my cash allocation near 20% to take advantage of better buying opportunities if we get them later in the year. If we don’t, I’ll happily ride the rally back to new all time highs with the 80% upside exposure I already have. It’s hard to explain just how great it feels to be prepared for both upside and downside outcomes in this market.

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I hope you have an amazing week and the future looks bright. 🤝