Marc De Mesel: Crypto Likely Drops To -60% Undervaluation

  • Thursday, 14 May 2020 06:53
Marc De Mesel: Crypto Likely Drops To -60% Undervaluation © Marc De Mesel
Decided to cancel my plan to go back to majority exposure already at $200B Crypto Marketcap as I believe chances are high we will go to -60% undervaluation to trendline multiple times again over next 1.5 year. If that were to happen now it would mean $155B, but even if it would happen only in half a year, that would still be only $200B. In menatime there are many opportunities elsewhere considering we are going through a big global crises, so opportunity cost is high when investing too soon in crypto. Also realized chances to double test the bottom are actually not high at all, and lowered from 60% to 20%, a major shift, as 1. - double - testing bottom never happened in past crypto cycles during early bull in 2011 and 2015, 2. There was huge volume when bottom was tested, increasing likelyhood that it was trend reversal from bearisch to bullisch, 3. The global crises we are going thorugh will likely accelerate adoption of innovation, which includes crypto, also lowering chance to test bottom twice. Also cleaned up Crypto Investment Sheet big time and no longer allocate based on different parameters, such as undervaluation to trendline or MVRV ratio, but only based on risk/reward Kelly Criterion, as I realised overinvesting, allocating too much is actually the biggest error an investor can make, causing lower returns as well as higher volatility possibly even leading to a bust, and may happen when you use other indicators than your edge (expected return/outcome) divided by your odds (upwards potential) = kelly allocation. Magical Kelly https://twitter.com/MarcDeMesel/status/1248498876970962944

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