A Breakout Finally??

Assalamu alaikum everyone. I hope you are doing well. Today is June 4th. Bitcoin is above 70,000, 70,500. And today we're going to talk about the major indicators that Bitcoin is providing us and some price targets based on different measurements that I like to look at and that are common for investors to watch. And we'll talk about what we can expect from Bitcoin miners who had a very strong day today. And if history were to repeat, what type of percentage gains can we expect from Bitcoin miners and will they outperform Bitcoin or not? So without further ado, let's get started. Now financial advice, be sure to do your own due diligence before making any investing decisions. And if you do appreciate these videos, do leave a like. It helps the channel, helps grow the community, helps other people see this content. So if you like this content, do leave a like. So let's start with the stock to flow model, perhaps the most well-known model. And this was actually based off of the gold stock to flow model, which is tested over many decades and happens to work rather well with Bitcoin. So the prediction for the price of Bitcoin is represented by the turquoise line on this graph. And you can see the actual price of Bitcoin is that colored line that's basically oscillating around the turquoise line. And this line, the colors on it represents the distance from the next Bitcoin having. And so now we're at a point where we're very distant from the next having, considering we just had the having in April. So we're at that. So we have that red dot on the price line. And the red is typically associated with the start of a major rally in price. That's what we've seen historically. If you look at the turquoise line, it is suggesting that by the end of 2025, we should be expecting levels close to 500,000. This is at least according to this one model. And I have to say, if you look historically, yes, the price has oscillated around it sometimes dramatically. But overall, the levels have been kind of spot on in terms of where we are, especially if you consider that we're looking at a logarithmic scale. So the differences on the y-axis are not linear, linearly spaced. So we've been quite close to what this model suggests. And it's very rare that you have that kind of asymmetric investment where the upside is as much as it is right now for Bitcoin. Let's look at the second indicator, which is the pie-cycle indicator. This indicator basically looks at the 111-day simple moving average. And twice the 350-day simple moving average, that's that purple line, the 111-day moving average. That's the turquoise line. And then the price is the yellow line. Now, what this indicator has been really good at is predicting the tops of each cycle within three days. And the way it predicts that is whenever the 111-day moving average crosses with the 350-day times two moving average, whenever that happens, then you have a top within three days, basically. And so if you look historically, whenever there's been an intersection between that purple and turquoise line, that's been a good time to sell. Now, what this is also suggesting, and what it's also useful for, is in the near term, it's useful for determining where floors are and where local peaks are. And the floor is typically where that turquoise line is, the local peak is typically where that purple line is, and it currently is suggesting a floor for Bitcoin of around 64,000. And a peak, near term peak of around 86,000. So considering we're at 70, we're closer to the floor than we are the peak. This is something that I think is good whenever you're thinking about buying. Let's look at the Bitcoin rainbow chart. So this is actually a very simple chart. It actually just looks at the prices at the time of having. And completely ignores the cycles that Bitcoin has, and it basically has a regression line using a logarithmic Y-axis and basically connects the dots. And the way to interpret this is to say that the blue area here, it means that we're on trend. If the prices within the blue area were on trend, if we're in the green area where one year ahead of trend, yellow is two years ahead of trend. Orange is three years and red is four years. Now, this would suggest that right now we're basically on trend with what the regression line suggests we should be. And but if you look historically, the price is actually a very commonly been outside of the trend that is suggested by this rainbow chart. And that's because Bitcoin has cycles. And so it's not unusual for us to be many months and even years outside of the trend. Now, the blue trend line suggested by this Bitcoin rainbow chart. Now, perhaps one of the most accurate Bitcoin price indicators has been the MVRV Z score. And currently we're right above two. This looks at the profit that Bitcoin holders are in. Obviously, the more profit they are in the more likely they are to sell. The less profit they have, the less likely they are to sell. And so typically when we've exceeded six or seven in terms of the Z score, that's corresponded with tops for the price of Bitcoin. And considering we're way below that, this is healthy for us. Now the cycle repeat is really interesting. So it actually looks at the past four years and it says, okay, if we had identical percentage movements in the next four years as we have for the last four years, what would be the price? And currently it does seem like this cycle repeat is pretty spot on in terms of predicting the price currently. And it does suggest that if we were to have the same percentage movements in the next period as we did four years ago, then we would top out close to 500,000. And again, here it's suggesting that this would happen at the end of 2025, which by the way, if you recall, is what the stock to flow model was suggesting that will top out around 500,000 close to the end of 2025. Now I was asked today in the Discord community for PIF, I was asked, hey, what do you plan on doing towards the end of this cycle? Will we be selling? And the answer is, absolutely, we will be selling. Obviously it is largely dependent on the relative attractiveness of different assets. So that's something to, because when you sell from one place, you have to put the money somewhere else or leave it in cash, so you have to weigh your options. However, the plan right now is to sell basically all of our altcoins and it's also probable that we sell a good chunk of our Bitcoin. If the indicators suggest that we're close to a top right now, they're not suggesting that. I think there's a lot more meat left on the bone in this cycle. However, we will get to a point where it's time to start exiting, staggering our way out. We won't do it in one fell swoop, we'll do it in small chunks. But definitely, we're not going to just be holding through the entire cycle. And something to cause one to be even more bullish, I think, is the fact that this time we have ETFs. And these ETFs have been on quite a streak as of late. I think they've had 12 or 13 days of continuous positive inflows. And if you look at the one month inflow, the net inflow into all of these Bitcoin ETFs, they've been close to two and a half billion. Year to date, they've basically had around 14 billion in inflows and net inflows. So that is quite remarkable. And this is a source of constant demand for Bitcoin. And perhaps it's why we haven't had the type of pullbacks that we are used to experiencing in previous cycles. In previous cycles, the pullbacks have been much more acute on a percentage basis than they were in this cycle. The biggest pullback we had was from the low 70s to the very high 50s. And then it didn't really stay in the 50s long at all. It bounced immediately into that 60,000 zone. And that's where we've basically been chopping for the last three months. And now we're north of 70. And as I mentioned, I do think, at least as per the data that I'm seeing, 63, 64,000 is probably the floor. We may not see Bitcoin in the 50s again. But obviously predicting the future is impossible. All we can do is look at the indicators that we have and try to make an educated guess. Now, in terms of Bitcoin miners, I think this is useful to look at because this is why we're invested in Bitcoin miners. A big part of our growth portfolio is in a Bitcoin miner. And if you look at this chart, it's actually kind of hard to read, but I'll read it for you. So in the last cycle, so if we look at May 2020 to May 2021, Bitcoin's appreciation in that period was around 700%. Now, the Bitcoin miners did a lot of them did much better. So if you look at Marathon, in that same period, it was up close to 2,900%. A right was up 1,500%. A bit farms was up 1,200%. And there were some miners that underperformed Bitcoin. So a bit digital, for example, was up 550%. Not bad, but underperformed Bitcoin. So in order to justify holding a Bitcoin miner, you have to end not Bitcoin, especially nowadays, because there are ETFs. So you can't hold them in your brokerage account. You can't hold Bitcoin directly in your brokerage account. In order to justify holding Bitcoin miners, you have to hold a Bitcoin miner that's going to outperform Bitcoin. And as we saw in the last run, there are many Bitcoin miners that outperformed Bitcoin by a lot. Sometimes 2x, sometimes 3x. And not only that, if we go back to this chart, at one point, Marathon was up 70% to 100% at its peak. So, I mean, this, but then it fell to that level that I mentioned, 2,800. And so it's really important for with Bitcoin miners to always be taking profits. If you happen to have chosen a Bitcoin miner that is performing well, then I would... Well, at least this is what I do, and especially with the PIF portfolios. I'm constantly taking profits. Today we took profits from IRIS Energy in our PIF portfolio. These things, while they go up really quickly, they pull back very quickly as well. So it's always a good policy, I think. Even if you don't intend on exiting the position entirely, taking some profits periodically makes a lot of sense, considering the nature of these assets. And it's very important to understand what you own and own the best of breed. Because, as we saw, not all Bitcoin miners are going to outperform Bitcoin. And in fact, if you look at in this cycle, the number of Bitcoin miners that have outperformed Bitcoin are actually a few and far between. That said, we're not at the end of the cycle, there's still room to run here. But aside from CleanSpark outperforming Bitcoin, most other Bitcoin miners have not. So something to keep in mind. If you want to just leave your life simple, then you can just hold the Bitcoin ETF. That being said, I do think that there is a lot to be gained from the right Bitcoin miners, and that's why we're invested in them. Going around the direction. Alright, so with that, if you'd like to follow our PIA portfolios, be sure to become a member. Link in the description. And so let's take some questions. Yes, currently we only have annual memberships. Alikum Salaam. We'll use cover Iron and BitB ready for major breakouts as well. Inshallah Martin, we have spoken about Iron before on this channel. We may have another dedicated Bitcoin miner live this week. So inshallah, we'll talk about others as well. Sorry for the lag guys and sorry for the interruption there. Thank you all for helping out. Thank you. I appreciate that. If Deutschcoin is a fork of Bitcoin, then why does it have much lower transaction fees? That's a good question, honestly. I don't really know technically why this is the case. But it is a good question. Iron going to break 10 bucks this week. Who knows? I will say that Bitcoin miners have been good at foretelling movements in Bitcoin itself. So today we had a really strong movement in Bitcoin miners, a more modest movement in Bitcoin. Perhaps this is predictive to some degree that Bitcoin is close to going on a run for itself. Halal leverage methods. It's leverage if you mean debt using debt, then it's tough to do that in a halal way. TLX, something I'll have to look at. Yeah, I think 100K by the end of the summer is very reasonable. Asam al-Aikum and yesterday's live view advised that we put our money in assets. How about our emergency fund? Yeah, I think obviously everyone has a different calculus, different situation. But I think a two to three month of expenses in cash is a good policy to go. But I think there's a lot of different elements that may go into that. Obviously, if you have a big purchase coming up, that should be in cash. If you have an expense coming up, that should be in cash. You should not be investing any money that you need in the near term. The market is very irrational sometimes and unpredictable in the near term. So make sure that you're not taking on so much risk that it's causing you to have trouble sleeping at night. If you're thinking about your investments before you go to sleep, you're worried about them, you're calculating. Well, I have enough cash for such and such expense. You've probably taken on too much risk. So be more heavy in cash until you feel like, okay, investments are not really a source of stress for me. I have the next few months in cash and I can invest comfortably. And it also is a good policy just to make good investing decisions because when you have enough cash for the next month or for the next few months, you don't panic sell. You don't fall mobile. You're a lot more even killed with regards to your temperament. And really investing is a largely a game of temperament and making sure that you are rational in your movements. Why? Thank you very much. Why do some Bitcoin miners succeed while others fail? Well, there are a number of different factors. So efficiency is one. The cost of electricity is another. The access to power is another. The overhead expenses for their operation. Although these things come into play, the amount of leverage that the company has. If it's paying any interest, how much strain does that? And it's that payments, how much strain do those things exercise on the company. So it's very important to take those into account. Obviously, we avoid companies that have material amounts of leverage and focus on companies. We would know that at all. And so, yeah, it's very important to understand what you own. And with Bitcoin miners, you really have to have a stomach for volatility. So you need to understand what you own, have a stomach for volatility, and then be patient. And hopefully it will work out. Audio, maybe we have an issue with an audio, maybe associated with the electricity going out. So we'll have to see that after the live. Thanks for letting me know, Kadi. Sam, how are you doing? How are you doing? Have you sent an email? How are you doing? I'm not really sure what you're referring to. For the trades today, yes. I mean, email was sent to check your spam if you haven't received it. But yeah, we have sent an email. Do like and subscribe. Again, apologies for the interruption. Thank you for tuning in. Until next time, make sure to take care of yourself. Assalamu alaikum . And peace be upon you all.