The CEO of Pantera Capital, Dan Morehead, said bitcoin has hit a buy signal after falling some 75% to then sideway at around $8,000 for the past six days. Pantera focuses exclusively on digital currencies and blockchain technology.
“For those who are new to Pantera who might think a fund manager like Pantera would always be saying ‘Today’s a great day to get long.’ we’ve only made four cryptocurrency trade recommendations in seven years: three buy recommendations and one sell/it’s-going-to-go-sideways-for-a-while,”
Their rational is bitcoin’s 200 days moving average, which is bitcoin’s average closing price over the last 200 days.
“Bitcoin just hit that rare buy signal again. It just crossed below its 200-day moving average,”
While a textbook of 200d as an indicator says:
“On the surface, it seems as though the higher the 200-day moving average goes, the more bullish the market is (and the lower it goes, the more bearish). In practice, however, the reverse is true.
Extremely high readings are a warning that the market may soon reverse to the downside. High readings reveal that traders are far too optimistic. When this occurs, fresh new buyers are often few and far between.
Meanwhile, very low readings signify the reverse; the bears are in the ascendancy and a bottom is near. The shorter the moving average, the sooner you’ll see a change in the market.”
In only the fourth trade recommendation over seven years, and seemingly primarily based on the 200d moving average, Pantera has thus apparently turned bullish.
They do not mention other cryptos in their trade recommendation, but they reveal they hold a diverse portfolio of countless of digital currencies, tokens, and business equity. All of the three big ones are there: eth, bitcoin, bitcoin cash. Ripple is there through what appears to be investment in the team or the company. Same for Brave (BAT). While Zcash is there both through the team and through coin holding.