This Little Altcoin Is Making a Big Splash

By The Weiss Crypto Team on October 12, 2021

Each week, the Weiss Crypto Sunday Special brings you actionable video content on the hottest macro trends in crypto.

But in this special interview, host Chris Coney narrows his focus on one red-hot crypto that could double your initial investment. In fact, it already did that — and then some! — for our Weiss Crypto Portfolio subscribers.

And small, little-known cryptos with big future potential are the focus of Undiscovered Cryptos. Subscribers there have turned small investments into big gains of 66% ... 118% … even 134%! In fact, Dr. Martin Weiss just released an urgent crypto briefing about one of these undiscovered cryptos. I urge you to watch it now … because we’ll be taking it offline TONIGHT.

And for the little altcoin that made a big splash for our Weiss Crypto Portfolio subscribers, you can watch the video here, or read on for the full transcript ... 

Chris Coney:

Hi there, guys, and welcome to this week's edition of the Weiss Crypto Sunday Special with me, your host, Chris Coney. Returning guest is Alex Benfield. Alex, welcome back to the Sunday Special.

Alex Benfield:

Thanks for having me back, Chris.

Chris:

Nice to have you back here, mate. 

So today, we're going to dig into a trade recommendation that was made to subscribers of the Weiss Crypto Portfolio that ended up going absolutely ballistic. So, I thought this was a good one to talk about. 

I think this [trade] in particular blew everyone's expectations. So that's why I wanted to talk about it. I'll give a before, during and after kind of a low look. 

So as far as I'm concerned, as a subscriber to Weiss Crypto Portfolio, the first I heard about this was an email. It's a Trader Monitor email that I got from you, actually.

You said Solana (SOL) had made a low on July 20 of about $23.45. So, you were reporting the price of $23.45 in hindsight, because you sent the email on Aug. 16. And Solana had already gone up to $62 by then. So, at the time of the email, the price was $6, but you were saying that just three or four weeks prior, it was $23.45. Despite the fact that it had already gone up so much, you just still gave a “buy” recommendation. So do you want to talk about that a little bit?

Alex:

Yeah, yeah. There are a lot of factors that go into that. And this was a surprise trade for a lot of people because Solana was not a coin that we'd been talking about. We do monitor a good chunk of coins all the time and Solana is not one of those, at least it wasn't. That's because it's a fairly new coin and so it wasn't necessarily something that was on our radar already. It was something that I had been seeing online just being discussed on Twitter (NYSE: TWTR). People were really talking about it and getting excited about Solana.

Chris:

They were.

Alex:

They were getting excited about it. But you see, it was like rumors. It was the occasional tweet about Solana, which is how I knew that it still had room to grow because not everyone was talking about it.

Chris:

Okay, so I see what you mean. So, sort of like, what did you spot? A gap between the price action and then the sentiment?

Alex:

Yeah, exactly. That's what it was. 

As far as a trade goes, the social sentiment doesn't always match up where the price is. So, there are some very high performing, high market-cap coins that people don't really talk about that often. You don't really see that many tweets about Monero (XMR, Tech/Adoption Grade “C+”) for example. If you start seeing a bunch of tweets about Monero, there's probably something there. 

But Solana is a coin that not many people have even heard of yet. And it had only been listed on Coinbase Global (Nasdaq: COIN) in June, so that was another big factor of why I wanted to make this trade. I knew that not a lot of people had heard about this coin. Not that many people had exposure to it yet. And it had had just gotten listed on Coinbase not that long ago. So, to put everything into perspective as well, July 20 which is where I said Solana had made a low, that was pretty much a market wide low.

Almost the entire market had kind of dumped a little bit on July 20. It was a mass kind of like a panic selling event. So, I knew that most coins had made like a fair bottom there and that it was most likely the floor of this trade. 

But yeah, it is a little odd to jump and do a trade after something has almost tripled in price. So, I think when we made the trade on Aug. 16, Solana was already above $60. It had almost tripled in price at that point. So you would think, “Oh, I've already missed out on all the profits.”

Chris:

You would think that, right.

Alex:

But you can't really think that way. And this fits the cryptocurrency markets to a tee because a lot of people already think that they're too late. They've missed out on all the profits and they don't look at the future potential of the assets of the trading. 

I think perhaps my previous experience in the markets helped to make this Solana trade because I wasn't blinded by the past returns. I was focused on the potential future returns we could get out of this trade. So yeah, like I said, there are a lot of factors that went into it.

Chris:

Yeah. The Weiss Crypto Timing Model gathers price data from the market. But does it gather data for all coins? I don't think it does every coin out there, does it? Because that would be a lot of processing.

Alex:

No, no. The Weiss Crypto Timing Model is more of a process than it is an exact number of coins that we're looking at. We can apply that process to any coin that we want. 

I talked with Juan when Solana started bubbling up on my radar. Then we put it through the process and we realized that it was a good time to buy. The coin had already broken out and it had momentum behind it, which is another one of the big factors. 

Basically, this trade jumped out to me because of the social sentiment that was bubbling up as well as the massive momentum that was building on top of it. It had already broken out, momentum was building and we wanted to ride that momentum. 

Typically, you let it ride until you see momentum dying down. That's not just one bad day of trading ... that's two or three, four days where it's starting to lose that push. And so that's when we exited. We saw it losing momentum, jumped out of it.

Chris:

Sure. We'll get to that in a second.

First, what you just said there about you identifying the opportunity then running it through — the model is a perfect example of a computer-assisted — but human-identified — opportunity. And that reminds me of when I was listening to one of Ray Dalio's audio books about how they developed quite sophisticated algorithms that they don't let the algorithm decide for them. 

You and I may have even spoken about this on the Sunday Special before, but they don't just let the algorithm go and spend their money. They use it purely as an advisory, an expert system that makes recommendations. Then, the human analysts curate those recommendations and go “No, not that one.” There's always a human sign off aspect to it. And what you just said there sort of mirrors that quite closely. So maybe that's the way, the way of balancing the two.

Alex:

Perhaps, perhaps. Like we said in the beginning, this was kind of an unusual trade. The Solana trade stands out from the trades we usually make because ...

  1. It was the first time that we've traded this asset, so it was new for us. And ... 
  1. It had already almost tripled in price. We don't always jump in at those times. 

So, this was definitely an odd trade. It was picked out almost entirely because of the social sentiment that had been building behind Solana. And then it was confirmed really through the momentum and through the model.

Chris:

Totally with you. So for anyone who's not familiar, what is Solana exactly or briefly?

Alex:

So, Solana's a Layer-1 ecosystem and an Ethereum (ETH, Tech/Adoption “A-”) competitor, with a few technical differences. And alternative Layer-1 options started really gaining in popularity in the middle of this summer. You saw Cardano (ADA, Tech/Adoption Grade “B-”) spike in price. We've seen Avalanche (AVAX) has really been gaining in price as well. And Solana really was, I think, the big winner of the Layer-1 battle that's been happening.

Chris:

Why so explosive? Remember, we're talking about the exact gains in a minute, but was this just one of those trades, or was there a particular reason why it was so explosive?

Alex:

I mean, I don't want to sound like a broken record, but honestly it was the social sentiment that was bubbling up and we were able to ride the momentum of Solana in particular. But also riding the momentum of this Layer-1 boom that was happening. So there was a compounding of factors that really sent Solana to the roof.

Chris:

That's like a social feedback loop. So, there was the social sentiment, and then there was some price action and that sort of fed back into social media and then created more price action but happened at a quite a fast pace and then …

Alex:

Oh yeah. It kept bubbling up, and once it started making some big returns, more and more people started talking about it. Which then spread the word of Solana out to more and more people who then proceeded to buy more and more Solana. 

So yeah, you're right. It is like a repetitive feedback loop.

Chris:

I'm sure that happens though but doesn't necessarily lead to a massive blowout like that. So what was the content of the social conversations that made people think Solana was such a hot project?

Alex:

Right, it was positive feedback. So at this point in time, people were looking for alternatives to Ethereum. They want to use these different Layer-1 but they're also looking to make potential bets that Ethereum won't be the only winner in the smart contract space. 

And then Solana capitalized on the non-fungible token (NFT) trend. 

They started releasing their own NFTs, which led to people then wanting to buy Solana to join the network. There were actually multiple repetitive feedback loops that all happened at the same time. So, I guess it was just one of those trades where everything seemed to line up. And that doesn't happen very often. 

So that definitely played part in why Solana spiked in price from $23 all the way up to over $200 at one point in a matter of two and a half months.

Chris:

Yep, yeah, yeah we can run through that. So, after the recommendation on July 16, what happened? Many of you noticed here by Aug. 16, the trade recommendation was made when Solana was $62. And then we're talking about a week later, Aug. 23, it's almost $80. 

The difference is that even if there are some of these perfect storms and it is one of those trades, often you see it after the fact or whatever. But this is notable because you made the trade recommendation to buy Solana demonstrably before this actually happened. So, then it went to $80 and then a week later — we're talking about Aug. 30 — you sent out another update saying it hit $105. 

It was breaking all-time highs at that point, which means there was no historical price data to predict where it would go.

And I quite like these ones; this happens in crypto bull markets. If you learn technical analysis, you learn to withdraw support and resistance based on how the market reacted when the asset was priced at certain levels in the past. 

But when you break all-time highs, there is no support or resistance. You have absolutely thrown all that out the window. And then you have to get into sort of predictive analysis which is a different methodology altogether. So then you don't know where it's going to go. So do you want to comment on that?

Alex:

Yeah, so that's if you go back to look at Aug. 16. 

Solana was listed on Coinbase in June and already by Aug. 16, it was trading at levels that it had never traded on Coinbase. There was no previous price history to really look at. And on Aug. 16, it posted a huge green candle. Right as it broke through all-time highs. So that usually means momentum is building. Even on the day that we made the trade, it already looked like there was plenty of room to grow despite the fact that it had already tripled.

Chris:

So that Coinbase day, Aug. 16, was that an all-time high, or had it traded above that already?

Alex:

It was an all-time high on Coinbase.

Chris:

Right, that's the way people discovered it, I suppose.

Alex:

Right. I don't know what its previous all-time high was on another exchange, but I'm pretty sure that Aug. 16 was an all-time high across the board.

Chris:

From a major exchange point of view. So, we're still on to trading on decentralized exchanges (DEX) beforehand?

Alex:

I'm not sure, I'm not sure.

Chris:

Just curious.

Alex:

Yeah. I believe it was definitely traded on other centralized exchanges. I believe it was first listed on FTX. I'm not entirely positive about that. Solana has been around since the beginning of the year.

Chris:

Okay, that's very interesting. That is very interesting. Okay, that is interesting.

Alex:

Some crypto analysts were in Solana, much, much earlier than me. So I didn't have previous knowledge of Solana. I hadn't heard about it from conferences or anything like that. But once I was able to gauge the social sentiment that was building up around it on Twitter, it was obvious that the people that had bought Solana early were buying more, and they were even more bullish and more excited about it now when it was hitting all-time highs than they were back when they first got into it. 

So, it seemed like there was plenty of room for it to grow. Not to mention comparing Solana when it was at $60 to the market cap of Ethereum; there was a ton of room for it to grow before it even came close to getting as big as Ethereum. 

So, when you're evaluating Layer-1, its potential is some multiple of another Layer-1. It's usually Ethereum. So it could be up to some fraction of the market cap of Ethereum.

Chris:

Yep, I get that. And you're looking at that gap and see if it's reasonable. I mean if it’s like 90% the size of Ethereum, you'd say well, there's not ...

Alex:

It probably doesn’t have a lot more room to grow. But then the tricky part is you have to gauge Ethereum's market cap as well and ask if Ethereum is trading at fair price now, at this time in the bull market, and whether or not Solana could grow past Ethereum's current market cap at some point.

Chris:

At its level? I don't think anyone's going to take [crosstalk 00:17:59].

Alex:

I'm not saying Solana would flip Ethereum or anything. I'm saying where Ethereum's current market cap is, it can actually let Solana in the room at some point.

Chris:

You mean if the entire ecosystem grew?

Alex:

Yes, yes. Because, obviously, Ethereum wasn't trading at an all-time high in all of this.

Chris:

Mm-hmm (affirmative) I got you. So, then the last two parts of the trade were on Sept. 2. The trade was up about 80%, but you still didn't close it. A week later, it was up over 100%. So, it doubled from when the trade recommendation was made. 

And then finally, Sept. 20, just a month after the original recommendation on Aug. 16, you finally made the recommendation to close the trade out. It was trading about $140 at the time. 

The overall profit on that trade was 115% in roughly a 30-day period. So pretty, pretty good, if you ask me.

Alex:

Yeah. I actually wanted to close the trade on Sept. 9 when it hit its all-time high. But this goes back to evaluating where the market cap of Ethereum was. I had done an analysis in my head of what fraction of Ethereum's market cap I thought Solana's value was. And it came just within a hair of hitting that target. So we actually missed like the peak exit and ended up exiting at 115% profit. But we almost exited for considerably more.

Chris:

I had noticed that when I was doing the research and looked at the chart, the trade was closed on sort of a little bit of a pullback. But I think the algorithm, the Weiss Crypto Timing Model, needs something like that as confirmation that it's time to get out. Like you were saying about the momentum dying off ... whereas your human eye was a bit more ahead of that.

Alex:

Exactly right. The Weiss Model never really sells the peak. It sells just after the peak has been confirmed. So it's not necessarily about maximizing profits, it's about minimizing your loss while still making you money. But I was able to put a target in my head of where I wanted this asset to get to, and we just missed the target.

Chris:

Gotcha. It was good timing though, because like a week after that, it hasn't really moved much. It kind of fell off a little bit and then it’s dithered around.

Alex:

No, and honestly, I'm not sure if this is really the end of the move for Solana. I think that there are definitely more gains to be made at some point here. The crypto market in general has gotten a little bit of air taken out of it over the past two weeks or so.

Chris:

True.

Alex:

And when that happens, it kind of sucks all the momentum out of the coins that are moving. So, all coins really perform a lot better when Bitcoin (BTC, Tech/Adoption Grade “A-”) is trading sideways but slightly upwards. 

So, when Bitcoin is kind of gaining in price, all coins can really boom. But when Bitcoin's dropping like this, it has a bad day, and sometimes that can scare away all coin investors.

Chris:

Sure. Sometimes people take all coin profits and rotate them back into Bitcoin ... or take their money out completely into stablecoins or whatever. 

So, one question that viewers might have is, “Okay, so how do I get these emails with these recommendations?” So if someone wants to get these “kind of in future” trade recommendations, what would they need to do? What service do they need to be on?

Alex:

Right. So, trades like these come through our Weiss Crypto Portfolio product. That's our high-end, top-tier product. And in that product, we cover both a long-term portfolio, where we keep assets for a full year or longer based on our outlook. We're basically timing the bottom of — or as close to the bottom of — a bear market as possible and waiting to sell until as close to the top of the bull market. So those are long holds, that could be multiple years. 

But the Weiss Crypto Portfolio also comes the medium-Term Portfolio, which is where the Solana trade was made. And it was actually a bonus trade: Our portfolio was already full and Solana was a bonus trade on top of the portfolio that was already performing well.

Chris:

It was already allocated it and it was like discretionary if you took this one.

Alex:

Right. Well, it was too good of an opportunity to pass up.

Chris:

Yeah, absolutely. I mean they're all discretionary because it's just a recommendation; it's not an instruction to buy. So, the investors have to take the action, decide which ones they want to take or not. 

But we do still maintain a model portfolio of what it would look like if you had taken all the recommendations, right?

Alex:

Of course, yes.

Chris:

So yeah, it's pretty good for accountability’s sake.

Alex:

Yes. And we also have our free Weiss Crypto Daily product, which I believe is probably where some people are watching this video. And we don't necessarily make trade recommendations here or anything like that. But we do follow these assets. So, anybody that was subscribed to Weiss Crypto Daily would've heard about Solana around the same time that we made the trade.

Chris:

But could have gone off and done their own research and whatever.

Alex:

They could have gone off, done their own research. But if you really want the best, the timeliest material, then Weiss Crypto Portfolio is the product to be subscribed to.

Chris:

Superb, all right cool. I think that's going to do it for today. You're right to close it there?

Alex:

Yeah.

Chris:

Okay. Well, that's going to do it for this week's edition of the Weiss Crypto Sunday Special with Chris Coney and Alex Benfield. Until the next one, it's bye for now.

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