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A quick update on Bitcoin/SPY, and the Baltic Dry Index

Sunday morning greetings! A loyal reader asked me whether I am really investing in the SPY based on my Bitcoin signal from March 1 onwards, as previously announced. My problem with this is that Bitcoin, after its recent plunge, is currently bouncing off its 200-day moving average. And it is this moving average that happens to be my buy/sell signal.

Obviously, this can resolve in either a positive or negative way. I think such a situation calls for patience until the market figures out where it wants to go. Therefore, I am postponing the start of this strategy (as far as investing my own money) to April 1.

The previous days have been worrisome, but such times are part and parcel of investing. What I find interesting is the recent advance of the Baltic Dry Index. One to two more weeks at this pace, and we’ll have a buy signal.

If results from 2019 were indicative of the future, then this might be a chance to make a penny or two (CAGR 31.07%, maximum monthly drawdown -9.41%, worst year +0.71%).

Personally, I have been using this signal since when I wrote about it in April 2022, and since then it has resulted in a CAGR of 31.72% with a drawdown of -8.58%, so the out-of-sample data ain’t too shabby. Nonetheless, its data history is much too short to be employed for large monies, so don’t get excited, please.

It’s a weird time to invest. Internationally, all kinds of markets are making all-time highs, and it is hard to make the case that this is anything but a bull market. And yet, things feel off.

We’ll see how they resolve. Investing is often about doing nothing, except maybe listening to music. In the words of Elvis Costello, “Every time I hold you, I just want to put you down!”