TRADING CRYPTOS - THIS IS THE PERFECT CONTRARIAN OPPORTUNITY

Big Changes On The Horizon

November 16 is rapidly approaching. And with much anticipation of the next fork, Segwit2x, miners and investors alike have been piling into Bitcoin to take advantage of the free money that is about to fall from the crypto heavens. To the delight of people currently holding Bitcoin, this has caused the price of Bitcoin to rise dramatically over the last few days...currently sitting at $7,132 per Bitcoin!

Good stuff!

Image source: inc42.com

What Will Segwit2x Mean For Bitcoin Holders?

Mo' money, mo' problems, right!? Like previous forks, Bitcoin Cash and Bitcoin Gold, there will just be another crypto deposited into our wallets, right?

Image source: cointelegraph.com


Not so fast...according to Pete Rizzo:

But to begin, it's important to note how this fork differs from others. Coming on the heels of the Bitcoin cash and Bitcoin gold forks, Bitcoin users might be accustomed to certain outcomes - ones that might not be guaranteed in the case of Segwit2x.

This smooth outcome, however, isn't guaranteed with Segwit2x. Complicating matters is that in many ways, Segwit2x sounds (and is) similar to other Bitcoin forks.

It's the differences, however that stand out this time around. First and foremost, whereas Bitcoin cash developers appeared content to create a new blockchain (with new rules), Segwit2x's goal is to keep all Bitcoin's existing users on one blockchain. In this way, Segwit2x could have different outcomes.

The article continues with explaining how some of bitcoin's rules could change or two Bitcoins could be created. You can read more about that here:
Www.coindesk.com/understanding-segwit2x-bitcoins-next-fork-might-be-different/

But my intent for this post is not to discuss the potential changes to the currency.

Alternative Trading Strategy

As I mentioned above, it is clear that money has been pouring into Bitcoin lately and as a result, has been driving up the price.

Putting on my contrarian thinking cap, this could be a great opportunity to see some great percentage gains. If you've been following the prices of your favorite altcoins, you might have noticed many of them have dropped significantly. Steem in particular, is as low as I have seen it since before the last fork, when I saw that it dropped to around $0.95 USD. And after the fork, I remember watching the price rise to at least $1.61 USD. Litecoin was around $83, but sits in the low $50s today. SALT, VERI, NEO, DASH, etc...pick a crypto and you might see that it has dropped since the Bitcoin Cash fork in August.

As more money flows out of the altcoins and into Bitcoin ahead of this fork on November 16th, prices for those altcoins may continue to drop. If so, this might be a great time to stock up on the altcoins with any new money you plan to invest, as opposed to sticking it in Bitcoin. True, you will miss out on the issuance of any new crypto that comes out of Segwit2x, but your percentage gains could potentially be much higher as the money flows back out of Bitcoin and into the altcoins after the fork.

Then, after altcoins rise, you could sell your altcoins near their new high, and buy Bitcoin if you really want to. With money flowing out of Bitcoin, it is likely to fall in price after the fork happens, anyway.

Warren Buffett believes that small investors have an advantage over large investors because it is easier for them to realize greater percentages of gains. Similarly, I believe altcoins hold a tremendous advantage in the near-term because it will be easier for them to see a greater percentage of gains. Continue holding whatever Bitcoin you have, but my new money will be targeting altcoins.

Good luck!

-Randomness