If you’re in Tesla, you’re making a lot of money right now.
If not, don’t worry. Tesla is about to get a huge supply-demand balance that will shoot TSLA through the roof.
And we have to talk bitcoin.
There’s a lot of speculation around this digital gold. So, I’ll show you what’s really happening and why you should inherit a “bitcoin millionaires” mentality in the markets.
I’ll also tell you how pot just made another move toward becoming one of the biggest disruptions of the decade. And the best stock to buy before the rise.
Tesla Stock Price Soars Higher
I want to start off this week by talking about Tesla. If you have Tesla stock, congratulations. Right now you are making a lot of money. The stock is way up. It’s almost $500 as of the time I’m recording, which is Thursday. There’s a lot going on with the stock right now.
First of all, a couple days ago Tesla started their deliveries in China — a couple thousand a week, which is huge. China is, by far, the leader in electric vehicle (EV) sales in the whole world. 1.4 billion people live there, so that’s a big, important market for Tesla. In their factory there, they are going to be able to make 500,000 cars a year.
That’s a lot of supply to meet even more growing demand in China. That’s big news for them. It’s going to be a big boost to their sales and, we believe, going to be a big boost to their stock price. Another boost to their stock price is the fact that a lot of people took profits recently.
Millennials Are Buying Tesla Stock
The number of accounts on Robinhood, which is a popular app for trading — some of you might even use it. I know it’s a popular app with millennials. You can see that a lot of people have taken profits and they are just starting to get back in. At the end of the chart you can see the spike.
The number of accounts with Tesla is going straight up.
A lot of people saw that Tesla had gotten to the high-$300 range and sold off quickly after that. There was a lot of profit taking around there. But this time, it was completely different. There’s so much demand right now.
That’s going to keep going even higher because so many people got out and there’s so many on the sidelines. People are just now starting to buy back in around $480. That is a big deal for Tesla, both for the company and the supply and demand for their stock.
Tesla’s $90 billion valuation: it is now the highest-valued carmaker ever in the world. The valuation is almost $90 billion. That is a big deal. The market is finally catching on to what they’re doing, the importance of the EV market and that they are the pioneers there.
More States Will Legalize Marijuana in 2020
Illinois legalized recreational marijuana on January 1. It was a big hit with $3.2 million in sales on day one alone. $11 million in sales in the first five days. There’s clearly a huge market. The first day at $3.2 million in 50% higher than the average day for all over Canada, which has three times more people than Illinois.
In one of our services, $10 Million Portfolio, we have a few companies that are really big in Illinois. It’s part of a trend we’re seeing where the U.S. is about to dominate the global pot market. By 2024 it’s expected to be more than a $40 billion market. Like I’ve said before, I think it’s going to be more than that.
As we’ve seen, it’s disrupting the alcohol industry and the tobacco industry. In the U.S. alone it’s a $2 trillion market. Pot at $40 billion by 2024 seems really low considering how much marketshare they are already taking from these trillion-dollar industries.
Finally, I want to talk about Bitcoin because of all the speculation about it. It did see a big price spike recently from $6800 to $8400. That’s a good thing. I want to show you this chart that really shows the amount of supply-demand imbalance that’s going to happen in the very near future. It’s been happening already actually.
You can see this is called the Bitcoin Millionaires. It’s any account which has more than 1,000 Bitcoin in it. The number of accounts has just gone up. When the price dropped in 2018, nobody sold. These big buyers, these people who are really taking up all the supply of Bitcoin, they don’t sell when Bitcoin crashes 80%.
That’s huge. That’s unlike the stock market where you see panic from hedge fund managers and billionaires who get completely out of the market and say it’s the end of the world. With Bitcoin you have this same level of demand from these big buyers that prop the market up.
With The Halving coming up in May, it’s going to get even more important when these people keep holding on. The amount of Bitcoin entering the market is going to be cut in half. The supply is going down and the demand is staying steady in the worst of times and going up in the best of times.
This follows a principle that’s pervasive throughout all markets, but with Bitcoin it’s important to realize. That is demand at higher prices. Now if you’re just getting into Bitcoin, you kinda heard about it before when it hit $20,000 but didn’t really pay attention to it, you’d say, “Wow, I would have bought a whole Bitcoin if I’d have known all of this.”
The realistic probability of you doing that is very low. At the low, there is no demand. It’s really the same as with stocks. Nobody is buying and everybody is fearful. The law of demand at higher prices says that when the price goes up, there’s more demand. This is completely true.
Bitcoin is Bottoming Out…For Now
When you see it at $3,000 you think it might go to zero, but then when it’s at $8,000 you think maybe you’ll buy in. Then it goes to $10,000, $12,000 and $14,000 when it peaked in June and everybody is buying. Then it goes down and everybody sells. They don’t want to go back in for a while because they just lost some money.
That’s the demand at higher prices. That’s important to note because, right now, Bitcoin is bottoming out around $7,000. It got below $7,000 a couple times recently. There’s not that much demand, but when it goes up to $10,000 or $15,000 again, more people are going to be buying in.
That’s going to push the price up because demand is higher at higher prices. It’s really that simple. We saw this before in 2017 when it went from a few hundred dollars to $20,000 in a year. It was really unknown by the general public when it was at $500.
Then, once it started making headlines and everybody was talking about it, people were becoming millionaires in a week. That just drove demand even higher. It’s a herd mentality. Right now we are at the point where demand is low.
As we see it start to go up, maybe because of the Halving or just because of the overwhelming demand by big buyers, we’re going to see even higher demand pushing it up even more. As Paul and I have said, we think it’s going to hit $100,000 this year. We believe it’s going to be a big year for Bitcoin.
I know it can be discouraging to see it fumble around $7,000 or $7,500 for a little bit, but I think now we really are at the point where it can make a big run in a short amount of time. I think this could be a very big year for Bitcoin. Just remember, when the price goes up demand goes up too. That’s what has caused the big rallies we’ve seen before in Bitcoin.
That is all I have for this week. This is Ian for Bold Profits. I hope you have a great Friday and a great weekend.
Editor, Rebound Profit Trader