This Crypto Bank is breaking out of a 4 Month Base! Let’s look at Silvergate $SI – October 1, 2021
NYXBT SI
This is Scott with your Chart of the Day. I want to take a look at a crypto bank that is breaking out of a 4-month base. This is the New York Stock Exchange Bitcoin Index ( INDEXNYSEGIS: NYXBT ) and as you can see bitcoin had a massive move today. In fact, as I am recording this video it’s upwards of 48 thousand, so it’s even higher than this close. We had a really nice move in the crypto space.
One stock that we have been watching at Stock Market Mentor is Silvergate Corp ( NYSE: SI ), this is a crypto bank. If I zoom out here you can see SI ( NYSE: SI ) had a massive run, pretty much as soon as bitcoin broke out last October Silvergate ( NYSE: SI ) ran 1,000 percent. It has since consolidated that move and gone sideways for quite some time.
Just in the last 4 months, you can see this nice little base of consolidation, where we have continuous higher lows during this consolidation. Now, that tells me that potentially institutions were coming in, to kind of save price here as they accumulate shares. As bitcoin broke out today we had a really nice breakout in Silvergate ( NYSE: SI ), and it came on higher than average volume.
A bunch of our members took this trade as I pointed it out in my Strategy Session last night. What I like is the fact that it didn’t just break out but it broke out, made a new high, did it on volume. And on the weekly chart, higher than average weekly volume. Some of the biggest weekly volume that it has had in months and months. So it is definitely a move with conviction and that kind of move is really hard to find in this market.
As it stands right now, I think that this chart is a little extended, just because it is quite far away from the 8-day exponential period moving average. If you were to buy this right here, right now you would really kind of need a stop about 12 percent down just so you know if you are wrong or not, that’s a little loose for me.
So what I would do now, in this case, or in your case is, keep an eye on Silvergate ( NYSE: SI ). You will want to see a nice gentle pullback to the 8-day exponential period moving average. And then potentially a little bit of a bounce trade, off of that moving average. It is making a new weekly high. It has a nice breakout in volume, and I think that if bitcoin continues this could definitely continue higher as well, so I think it is worth watching.
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