Is Now a Good Time to Invest in Bitcoin

Is now a good time to invest in Bitcoin? That depends upon whether you’re looking for a long term investment, or a short term trade. How to invest in Bitcoin? The best way to invest in Bitcoin might be through a stock, such as a crypto mining stock or Bitcoin mining stock. And if you want to know how to buy Bitcoin, you can do that through an exchange, through a spot Bitcoin ETF, or even through MSTR stock. But knowing why Bitcoin went up today will help you understand what Bitcoin will do in the future, and help you determine an accurate Bitcoin price prediction. My Bitcoin forecast might seem unbelievable until you understand what caused Bitcoin to go up today.

Bitcoin rallied 10% on Wednesday, so it is now a good time to invest? Is this the start of a new all time highs on Bitcoin, or was Wednesday’s rally just a bull trap? Is Bitcoin going to turn around and start going back down again? Well despite how bullish I am on Bitcoin in the long term, my answer might shock you. For those of you who are new to this channel, my name is Stock Curry. I’m a former Merrill Lynch and Morgan Stanley investment banker, and I have over 25 years of trading experience. And in order to understand whether Bitcoin is going to continue its rally past Wednesday, or if it’s going to turn around and start going back down again, you first have to understand why Bitcoin rallied 10% on Wednesday.

Wednesday’s 10% rally on Bitcoin comes in the midst of a short term pullback in Bitcoin, and the rally turned around and topped out at the previous all time high, which is a point of resistance. Meaning from here, Bitcoin might continue to rally and hit new all time highs, or it could turn around and just continue the downturn that we’ve seen over the past week. So let’s talk about why Bitcoin rallied on Wednesday. And this is going to help you understand whether Bitcoin is going to continue to rally, or whether it’s going to turn around and start going back down.

On Wednesday, the Federal Reserve had their March FOMC meeting, where they held interest rates steady and they maintained three rate cuts are still coming. At some point this year, Fed officials penciled in three quarter percent point cuts by the end of 2024, which would be the first reductions since the early days of the Covid pandemic in March 2020. Now, why am I focusing so much on the Federal Reserve and their interest rate cuts? Why does the fact that the Federal Reserve has not cut interest rates since March of 2020 matter to Bitcoin? What is the connection? Well, let’s take a look at what Bitcoin did in March of 2020.

This is a weekly chart of Bitcoin. And going into March of 2020, Bitcoin had been falling and had been on a long term decline. But when the Federal Reserve cut rates in March of 2020, marked by the X here, that marked a bottom in Bitcoin. And from that moment forward, Bitcoin went on a massive rally. What do I mean by a massive rally? Bitcoin rallied 1,500% in just one year. From the point the Federal Reserve first started cutting rates, Bitcoin rallied from $4,000 all the way up to $64,900 in just one year.

The last time the Federal Reserve cut interest rates, Bitcoin rallied 1,500%. So that means Bitcoin is going to go on a new rally, with new all time highs, and rally 1,000% or more over the next year, right? Well, not so fast. This time could be different.

In February, the Consumer Price Index, that is, inflation, rose 0.4% on the month and 3.2% for the year. That was higher than expectations. And the reason this is a problem is because the Federal Reserve is only going to start cutting interest rates if inflation looks like it’s going to start getting back down to 2%. Unfortunately, in February the wholesale inflation index rose 0.6%, which was much more than expected. In fact, it represented a 4.1% year over year increase. The problem with this higher than expected inflation data is that it could cause the Federal Reserve to not lower interest rates.

Higher than expected inflation data to start 2024 triggered caution from top Fed officials, and the January FOMC meeting concluded with the central bank saying it needed more evidence that prices were decelerating before it would gain greater confidence on inflation, and start cutting rates. Unfortunately, over the past four months in a row now, inflation has actually gone up, not down, and the Fed is not going to start cutting rates until inflation starts going down consistently. And while the Federal Reserve did indicate three rate cuts this year, it’s important to understand that half of Fed officials see two rate cuts or less.

So while Bitcoin probably will go on a massive rally once the Federal Reserve starts cutting interest rates, timing when the Federal Reserve will start cutting interest rates becomes a lot more difficult. And with today’s meeting, the Federal Reserve kept interest rates the same, and they’re expected to keep interest rates the same at their next meeting as well. The earliest the Fed might start cutting interest rates is June. So is it too early to buy Bitcoin? Or should you wait till June, when the Fed is actually expected to start cutting interest rates?

Well, with today’s rally, I think there’s a good chance that Bitcoin might continue to go up, especially since the market now sees hopes for a Fed rate cut, and that might start causing people to buy Bitcoin – over hopes that Fed rate cuts might come in the future. Not only that, but the Bitcoin halving could also cause Bitcoin to go up, despite what the Federal Reserve does now.

And there are a lot of different ways to play Bitcoin. You don’t just have to buy Bitcoin. There are actually ways to make even more money than just buying Bitcoin. While Bitcoin was up 10% on the day, and MicroStrategy was only up 9%, Coinbase was up 11%, and the crypto miners were up as much as 20% on the day. And they also continued to go up in the after hours, rising an additional 3%. So while buying Bitcoin is certainly a good idea at the current time, there might be better things that you can invest in that would go up even faster, especially the crypto mining stocks, which have been beat down severely and have a lot of room to go up, if Bitcoin does in fact continue to go up.

I personally am invested in the crypto mining companies. I have call options on them. I also have shares and call options on Coinbase. And of course I own Bitcoin as well. So I am diversified across the different Bitcoin stocks as well as Bitcoin itself. I own all of them, and I honestly believe they’re all going to go up as Bitcoin goes up. But I especially think the crypto mining stocks are going to go up possibly twice as fast as Bitcoin itself goes up, just like we saw today where Bitcoin was up 10% and the crypto stocks were up anywhere from 15% to 25%.

Now there is another way, a far safer way, to play the Federal Reserve cutting interest rates than going and investing in Bitcoin or even Bitcoin stocks, because we are never going to be 100% sure how the market is going to respond to the Federal Reserve. But what we can have really good certainty on, is what the Federal Reserve is going to do at each FOMC meeting. Now, the next FOMC meeting for the Federal Reserve is in May, and I am betting that the Federal Reserve will not cut interest rates in May.

With event contracts, you can place a direct bet on the Federal Reserve cutting interest rates, and you can place a direct bet that the Federal Reserve is not going to cut interest rates in May. If you’re correct, this produces about a 14% profit, which annualized comes out to more than 100% profit per year. And if you can double your money every year, you’re doing pretty good.

So why do I not think the Federal Reserve is going to cut rates in May? The expectation heading into this week’s meeting is for the first cut to happen in June, with two more to follow. And that brings the markets in line with Fed officials. And with the Federal Reserve expecting their first interest rates to come in June, not May, I placed a bet that the Federal Reserve will not cut interest rates in May, and this should produce about a 14% profit. If you want to trade this event contract as well, which is a very safe bet in my humble opinion, then you can actually get $15 in free trades when you open an account, deposit at least $50 and just make your first trade. You can get those $15 in free trades here.

Let me know in the comments below what you think Bitcoin is going to do over the next few weeks. Let me know if you think the Bitcoin rally is going to continue and hit new all time highs before the end of April, or if you think this was just a one day rally and Bitcoin’s going to turn around and start going back down again. I’m also curious to know your thoughts on the Federal Reserve, their FOMC interest rate cuts, and whether or not you are trading on Kalshi. And if you’re making money like me, let me know in the comments below.

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