Hello everyone, and welcome to this week’s market insight.

Portfolio Update:

I bought roughly $340 of Bitcoin this week. As mentioned last week, the DCA timeline still runs into October. The weekly buy size is now smaller because the portfolio was already moved to 50% Bitcoin last week. This is now purchase 7 out of 20, with 13 weekly purchases remaining.

Market Update:

Not much has changed this week. Bitcoin is still consolidating in a fairly tight range. Despite being a volatile asset, plans do not need to change every week. Most of the time, the right thing to do is simply wait and let the setup develop.

For now, the four scenarios remain the same.

• Scenario one: this is the bottom, and Bitcoin moves higher from here.

• Scenario two: Bitcoin ranges for a while, then breaks higher.

• Scenario three: Bitcoin continues lower, but does not go much below $40k.

• Scenario four: Bitcoin enters a much deeper bear market and breaks below most historical models.

After my bottom indicator flashed last week, I now assign higher odds to scenario one than before. That said, I would still like to see Bitcoin reclaim the short-term holder realised price around $68k before saying that with more confidence. Until then, all scenarios remain possible. A break above $68k would be the first strong sign that the market is starting to recover. A break below the recent lows would make scenario three more likely.

Either way, the plan stays simple. The DCA continues.

Education of the Week: Asymmetric Returns

Asymmetric return means the potential upside is much larger than the potential downside.

That does not mean there is no risk. It means the risk may be worth taking because the reward is large enough. This is how I currently see Bitcoin. Even if Bitcoin falls to $40k in the coming months, which I assign low odds to, that would be a drawdown from current levels. It would not be fun, but it would also allow the remaining DCA purchases to happen at better prices. On the other side, my long-term thesis is that Bitcoin can trade above $200k within the next few years.

That is the asymmetry. From around $60k, a move to $40k is roughly 30% to 35% downside on Bitcoin. But if Bitcoin reaches $200k over the next few years, that is more than 200% upside from current levels.

The potential reward is much larger than the potential risk I am taking. That does not mean the downside does not matter. It does. But the portfolio is not fully allocated, and the DCA is still ongoing. If Bitcoin moves lower first, the remaining cash buys at better prices and the average entry improves. If Bitcoin moves higher from here, the portfolio already has meaningful exposure.

That is why I do not need to know the exact bottom. The goal is not to avoid every drawdown. The goal is to take risk when the upside is large enough to justify the downside.

That is where I think Bitcoin is today.

The plan stays the same.

Trilux