ESP Tuesday – Bitcoin Becomes a Money Magnet as Stocks Flounder. Two Ways to Play the Breakout.

Bitcoin is once again seen as flight to safety haven.

Stocks continue to chop along but Bitcoin seems to have finally delivered its highly awaited breakout. I’ve got two ways to trade it.

Market Update

The stock market failed to maintain its positive glow after yesterday’s bounce as too many worries are starting to gather on the trading crowd, not the least of which is the economic data due out this week, (GDP, October Payrolls, PCE, and Private sector jobs data)

The New York Stock Exchange Advance Decline line (NYAD) is acquiring a short term downcast look as it struggles to stay above its 20-day moving average which raises the potential for a test of its 50-day line.  The RSI is still testing the 50 level, but it looks wobbly, a posture which is raising the odds of a move down to 30 along with a test of the 50-day MA.

The U.S. Ten Year Note yield (TNX) has broken above 4.2%, which is a bearish move and has the look of something that isn’t likely to be reversed in the short term as the yield remains well inside the Bollinger Bands implying a “normal” trading pattern.  For more on how to use Bollinger Bands check out this video.

All of which brings me to Bitcoin (BTCUSD), which is attracting money which seems to be moving out of stocks and bonds as investors are preparing for some sort of surprise in the next few days.

Extended Stay Portfolio Update

In today’s issue, I am adding two ways to play the Bitcoin breakout. One is a straight ETF play, the other is via an option.

Thanks to everyone for your ongoing support.  I really appreciate it.

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