Bitcoin has completed printing a W in the chart, see below:
This run up may very well eclipse $33K. I am not able to foresee the run up stoping close to $30K. This new stimulus package from the Senate has kicked off more corporate buy in to Bitcoin and they are using Bots to auto buy Bitcoin 24/7 as a hedge against a crashing US Dollar. We have shown everyone the DXY Index crashing from 104 to 90, a 15.5% drop in the index. M1 Money Supply or Stock has jumped to $7 trillion in 2020 that is a 43% increase in USD money supply in 2020 alone! Biden is already working on constant UBI payments starting in 2021. Money supply will explode if he gets inaugurated! Expect $10-12 trillion in M1 money supply by 12/31/2021, click here to see.
The next chart from the St. Louis Fed is M2 Money Stock which includes household savings like M1 but then adds Time deposits and money market mutual funds. M2 jumped $5 trillion to just under $20 trillion in 2020 alone, click here to see.
Notice M1 is $7 trillion and M2 is $20 trillion. Velocity of money, or the amount in actual circulation is 34% of total money supply (M2). So, banks are not lending other than to large corporation for stock buy backs, which we have discussed before. Neutral ATM owns no stocks for this reason. That market is completely propped up by this practice. Now, when machine learning and AI become more prevelant in 2021-2023, deflationary, more Fed balance sheet growth will be required to compensate for deflation. The Fed always reacts with fiscal and monetary policy, this is a reaction to deflationary market dynamics. The DXY will continuously be getting pressured down into the foreseeable future. Below is a Business Week headline from 1979. Back then inflation was out of control. But as it was then, it will be true now. Inflation kills the stock market. If the Fed is going to attempt to defy the laws of economics and print currency so bank reserves are set up for corporations to buy back their own stock and juice the price, the US Economy will be in for a major crash when this model becomes unsustainable. Here is the article from a time when markets were still free:
Market manipulation will only make the crash worse. Bitcoin and to a lesser degree Gold, Silver will be the safe havens in 2021. Probably beyond that. Save money for the future in Bitcoin not US Dollars! Regardless of which president begins the next term on January 20th, this will be a winning strategy next year. Bitcoin could easily 10X in 2021 from where it is now ($28,900). Yesterday we mentioned 9X to 11X which is reasonable. Now is not the time to get squeamish about saving more money, the question is what currency do you save it in? That currency is Bitcoin. There is simply too much pressure on the Fed to print, deflationary demographics, deflationary technologies coming out, rise of socialism. The US Dollar will struggle next year especially in terms of purchasing power. We do see a deflationary stock market crash which could bounce the DXY back up. However, Bitcoin will remain the favorite wall street safe haven asset in 2021. We would be remise if we did not mention ETH (Ethereum). We own it, and believe it has the potential to reach $6,000 plus in 2021. We will likely push BTC to ETH as the Bitcoin price gets overbought and appears near the end of its cycle.
Neutral ATM is here to get everyone off of zero Bitcoin.
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