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Trading the Close with Gareth Soloway & Paul Giordano #btc #bitcoin

January 22, 2024

Join Marathon on interview on 'Trading the Close' with Paul Giordano, VP of Digital Asset Management at Marathon Digital Holdings. Paul delves into the intricacies of Bitcoin mining, the impact of halving on profitability, and Marathon's strategy as one of the largest Bitcoin holders. He also discusses the role of Bitcoin in the future economy and provides his expert perspective on Bitcoin's price trajectory for the year.

Transcripts are autogenerated. May contain typos.


[Music] welcome to trading the close on this Monday I'm Tony valier with verified investing here's what's making headlines today the stock market reaches a new high after two years Macy's rejects Ark house Management's 5.8 billion doll bid to take the department store private citing concerns over financing motor fuels distributor Sono says it will buy new Star Energy for about 7.


3 billion in an all stock deal Oppenheimer downgrades lows and Home Depot from outperform to perform cutting their price targets and we are just minutes from the closing bell let's see where things stand right now seeing a lot of green today on this Monday the Dow up more than 140 points that's 09 uh 39% rather up uh the NASDAQ is up 67 points that's almost up half a point and the S&P 500 now up 11 points.


25% we've got gold down just slightly and Bitcoin down quite a bit down 1465 points that's more than 3% down let's bring in Chief Market strategist Gareth Solway to break down the day's trading what do you make of the rally today breaking some records and the S&P 500 looking to do it again right right we saw a new all-time high on Friday followed up today by what looks to be a new all-time high this is your intraday data so again this starts right here we had this beautiful opening shoot up kind


of a gap up and then a continuation and then you could see what really happened I mean things got very sleepy the whole entire day it was just like a gentle kind of sideways move so I think what we're seeing here is that the S&P is still very positive people are investors are positive but they're also just kind of almost on hold waiting for earnings data this week we have Netflix tomorrow after the Bell Tesla later this week and the pce uh number which is the fed's favorite inflation gauge that's coming I


think on Friday so that's really kind of keeping us sideways but I think once we get these earnings announcements in the mix it's going to get pretty interesting a couple things here I just want to show you guys so if we flip over to the chart on the NASDAQ 100 this is a really interesting trend line and I want to draw your attention to something here so this is going back to the Co lows right here right and so we have that little pivot low and then we connect it right through here and I'm trying to get my


little drawing tool to work technology right what can you do right we need some AI in this mix here there we go right here and then we're right up against that level and what I'm what's drawing my attention is not the continued kind of grind higher but what we see here is this is the RSI RSI is relative strength index and we can see that right here this was a lower high than this right so this is a higher high this is a lower high but look at the RSA I a high and a lower high so what this tells me is that


the run in the NASDAQ may be losing a little steam in the near term here and that would kind of go along with the the idea because if you look at some of these semiconductor stocks they've had such massive runs and this is the chart of the SMH that they probably are getting a little bit tired and we know coming into earning season as well it's one of those things where if they don't put up amazing numbers everyone's expecting amazing numbers they have to go beyond just to get this rally to continue so I'm drawing the parallel


between the the negative Divergence and the rsis and the NASDAQ starting to give us the signal that there's distribution which is bigger money selling into this bigger rally now so little things like that catching my eye here you're you're drawing parallels to the dot era well that's another story right I mean when you look at some of these moves or just I mean look at this move in in meta right meta just actually hitting a double Top This is a this is an alltime High double top which on a technical


basis is resistance you can see it's being rejected here but I mean this is just some of the most incredible runs we've seen and one of the things that that I I think is is very important is that of all the sectors in the stock market the only one that's making a new all-time high is the tech sector so even though the whole Market is it's showing us the tech sector is so high like this is the tech sector like this and this is everything else everything else since CO's basically been just chopping


sideways and that again is a concern if you're looking at a market is it a healthy market then everything should be participating versus what we're seeing we're seeing just these Mega cap Tech and the semis are just carrying the load on their shoulders good as long as it lasts but if it doesn't last that's problematic so how do you work that well so for me that's one of those things where to me I continue to look at the data in the economy and I say all right listen we're starting to see more and


more of these data points that are showing weakness the job hirings numbers stuff like that are starting to signal that we probably do have a Slowdown coming so my guess is we'll start to see some of the bigger pullbacks in Tech they've just gone a little too far A little too fast and they're going to have to come back in towards those other sectors that haven't been performing so don't be surprised when that happens right all right we told you so a lot of big Market Movers today ADM Newar energy


Spirit Airlines Western Digital what are you watching today yeah so a lot of those moves are interesting but the the ones that are catching my end and I I I know people love their Tesla right so we'll talk Tesla real here so last week we talked about this wedge pattern we can see again how we hammered on the upper end here here and here each time being rejected and then we have this lower level down here and look at what's happening it's starting to get below this line and that's a warning signal


for me on the Tesla stock great company great EVS whatever you want to say but at least per the chart price this is now starting to show us a weak signal where we could be headed down to this area here or below and again it's one of the few of the kind of The Magnificent Seven that are not performing versus what we see on some of these other ones like let's bring up Microsoft I mean just a monster now the most valuable company out there and this just continues it is down on the day again but it is basically at all-time highs and it's


just remarkable right I mean even even the Nvidia chart here Nvidia rolling over a little bit into the end of the day but still I think eeking out a new high if we go to this chart you can see here this is the daily chart of Nvidia and again at that run and this is you know this looking at a chart okay well it went from 400 and change to $600 if this was like a 20 billion doll company it's like okay but this is a $1.


5 trillion company the amount of money I mean we talk about how the fed's like trying to pull back on monetary policy and then so the fed's doing that and then on the other side you have the government spending crazy amounts and then you have all this wealth being created and it's really offsetting a lot of what the FED is trying to do and interestingly enough I talked about this in the game plan today is the markets are now no longer pricing in the the chance of a March uh rate cut it's now may and I think that's what we're going


to see more if we're lucky right if if it even comes then and that and that the big kicker here is going to be number one where is inflation by that point if inflation really continues to come down they'll feel better about it but then also how the econom is doing is the economy starting to struggle okay let's talk Bitcoin we got to get into cryptocurrency today what's going on with Bitcoin because it looks like it's headed more more towards that Target that you keep mentioning which is that


38,000 level that that's correct right so so we were really watching this this up sloping trend line right along here and we could see again how it just kept on hitting and hitting and hitting and then we kind of just broke below it into the weekend consolidation and broke lower and it still does look like this is going to be your likely short-term Target so you're looking at 38,000 now interestingly enough the low today we did get a pretty nice intraday bounce that happens to be a CME Gap so the CME


are the Futures and they close uh Friday and they open Sunday so if if Bitcoin moves up over the weekend there's what's created is a gap where Bitcoin closed here on Friday right and then it opens up here on Sunday night when these CME Futures and so this area between would be a gap so what this really did was Bitcoin fell down and filled that Gap right there and it's a technical level so those need to be filled as well they're they're not special or different yeah I mean weirdly enough it still


plays a role it's not as major in my opinion but it still plays a role so it makes sense why we're getting a little bounce off the lows today cuz we were below 40,000 but the question is again is this just going to kind of go like this and then down that's my guess is it's just going to be a short-term bounce okay we will see Gareth thank you so much we appreciate it and don't forget that you can always watch Gareth navigate the charts in real time on his show the game plan it airs every weekday


morning right here at 9:00 a.m. on the verified investing YouTube channel I've got another special guest don't go away today it is Paul gordano the VP of digital asset management of marathon digital Holdings and Marathon by the way mins cryptocurrencies with a focus on blockchain ecosystem and the generation of digital assets so Paul thank you so much for being here today we appreciate it thank you for having me I I can't help saying your name jordano the little Italian accent um my first question let's talk about mining


um is there a simple way to explain mining even if you invest in it some people just don't understand how the process works right simply said Bitcoin mining is securing the Bitcoin Network and uh optimizing the usage of of energy either trapped or renewable energy or stabilizing the the current grid in uh creating Bitcoin lowering the cost of production on the energy side and um we get paid Bitcoin um for our services okay well we know Bitcoin uh there's going to be a having um this year and that's when um I believe the amount of


Bitcoin awarded to miners is cut in half the last one I believe was in 2020 so as a mining company how will the having impact Marathon digital well the mining occurs every four years or so and what happens it's it's sort of the pre-planned way of reducing the supply of Bitcoin over time because Bitcoin is the world only limited Supply asset uh it does affect miners because it reduces our our um Revenue per Bitcoin however uh Bitcoin miners in addition to the mining reward we get for creating a block we also get


uh fees um for usage of that Network which we've seen go up a lot because there's been a lot of interest in ordinals which are sort of nfts that are connected to bitcoin and transactions which have increased significantly over the past six or seven months or so so did you guys have to calculate the price Bitcoin will need to be in order to make a profit after the having well one of the things that we can't control is the price of Bitcoin we can control our input prices we can control our energy and our hosting


Services prices uh one of the we cannot control the price of Bitcoin so um all we can do is drive down our production try to be in the in the bottom um um most efficient quartile of production and that'll allow us to stay in business for a long time as we do believe in the macro trend for the price of Bitcoin to rise over time n you guys only mine Bitcoin is that correct that is correct yes we only mine Bitcoin and how many Bitcoin a day does marathon digital produce well it varies um we have been averaging between a, and 1,200 Bitcoin


per month um we currently hold uh about 15,000 Bitcoin in our Treasury and that makes us the largest holder of Bitcoin uh of all the public mining companies I got to ask you when Marathon digital stock was recently down uh 21% I believe it was what was the atmosphere like for you all was there concern that the company may not survive uh no there was never a concern that the company would not survive we have a very strong balance sheet we have a long list of Partners uh that we do business with and there's a lot of


opportunities for us we think that the the uh the have coming up is going to give us a lot of m&a opportunities because we are such a strong uh financially sound company um the the mood in the company is always very optimistic it's very energized there it's it's a it's a strong group of of passionate people about Bitcoin so no the the the short-term movements in the stock price have not changed the mood in the company one bit so last week former president Trump told voters in New Hampshire that he'd never allow a


federal Reserve digital dollar so looking to the 2024 election does marathon digital have a preference who makes it into the White House no we do not have a political preference one way or the other we believe that uh our job is to secure the Bitcoin Network to mine Bitcoin at the cheapest possible prices that we possibly can and to optimize our Treasury and our cash position um over time we don't think that uh a a central bank digital currency is a major competitor for Bitcoin uh we think Bitcoin is a store of value


similar to Gold uh we believe it's internet money there's over $5 trillion of uh of of transactions on the internet every year um and we think it's an inclusive monetary system there's over three billion people in the world that cannot have a bank account can't grow wealth can't store value and Bitcoin allows them to do that so we're much more focused on the value Bitcoin can bring uh rather than uh what external forces can do let's talk about the value of Bitcoin um where do you see the price


going by the end of the year and what kind of impact do you think the ETFs will have on Bitcoin in the long run well I think it's definitely a very strong positive uh um occurrence for Bitcoin going forward I think what's going on in the market right now is is some idiosyncratic market dynamics um rather than any kind of macro inspired directional change there were a lot of Legacy products that were not as efficient as uh the new ETF spot Bitcoin uh are and will be and they're they were much more expensive so we're seeing a


lot of unwinding of Leverage positions of Futures based positions into the new uh spot Bitcoin which I I believe is a tremendous success uh there's a over a billion dollars of new assets that have come in over the past 10 days um the it's the fifth biggest ETF ever it it it Rivals QQQ and all of the major uh traditional stock ETFs so we think that this will bring a new blood of of interest from uh from retail and institutional clients who are more used to investing uh through traditional Securities well on a personal note I


know you have uh 30 years or more in traditional financing you started your career at Maro Lynch where you were a foreign exchange officer then you were at the US bond trading desk you've also had your own hedge fund so I'm curious what made you get into digital currency did I get all that right yes you you you've got most of it right uh I just was very excited by the by the fact uh that we could have a monetary system that is not necessarily based on sort of the the the necessary Trust of traditional banking uh I


believe that there's um the the fact that Bitcoin can open up finance and and uh to millions of people around the world was very exciting to me and I I also like the idea of uh the smart contract platforms that were being built outside of Bitcoin and the entire crypto space so I decided I wanted to to learn this as much as I can I fell down the rabbit hole as they say and uh I I'm dedicated the rest of my career to this space okay now that you said that I've got to ask you because it's it's a


little complicated do you feel like you're still learning I'm learning every day uh I'm learning about mining I'm learning about um the usages for for Bitcoin and for uh some of the traditional um um um stock and Bond portfolios that could use Bitcoin as an exposure enhancement the traditional 6040 Bond stock exposure could have gone up by over 300 basis points over the past five years with only a 2% allocation to bitcoin I think it's it's something that is is really a GameChanger in finance I think it's a


GameChanger in in uh in power usage and I think it's a GameChanger for a lot of people around the world who've been excluded from the traditional system before we go I've got to ask you anybody who who's still skeptical about Bitcoin or even cryptocurrency what advice would you give to them any books any podcasts to to really learn about it and understand it well the Bitcoin standard is the is the starting point um for any uh path down the B the digital Rabbit Hole as I like to say so I would say start there


um there are uh a number of podcasts yours included that I think people can uh can listen to um Anthony p is amazing um but you know what there's there's no shortage of people who are passionate about this space I would say Seek those out and ask detailed questions um and uh I think you'll you'll be as excited about this as I am yeah I've learned there are no stupid questions because a lot of people are still learning Paul thank you so much for your time um and I hope you've got some good weather I know


you're joining from San liso California so enjoy that beautiful West Coast Paul Giordano with Marathon digital Holdings that does it Tony thank you it does it for trading the close on this Monday thank you so much for watching we will see you back here tomorrow make it a great rest of the [Music] day