Jesse’s traveling, so I’m deviating from our normal recaps to cover an area I’m bullish on:

Presidential memecoins.

If memecoins aren’t your thing, feel free to skip this one.

But, if you’re a bit of a degen, then keep reading—it might be entertaining.

Please note: this is not financial advice. 
These assets are even more volatile than bitcoin or ethereum, so you should only do it if you’re comfortable losing what you put in and have a plan for entry and exit. I have holdings in the assets mentioned from prices that are lower. Please, please, please be careful. In the recent drawdown, $BODEN lost 80% of its value within 35 days, so you have to know what you’re doing or you will lose money.

What Presidential memecoins are

Presidential memecoins are memecoins, like $DOGE or $PEPE, that have been named after the presidential candidates, Trump and Biden.

According to CoinGecko, the top three coins by market cap are $MAGA, $BODEN, and $TREMP.

None of these are endorsed by the official campaigns, and so they’re only valuable because these are the most popular ones related to the election.

Here’s a little more depth on each of them:

1. $MAGA ($380M market cap)
   This memecoin is the largest one for Trump. The developers take a 1% tax on every transaction and part of that is donated to National Veterans Homeless Support and Veterans for Child Rescue.

   

   $MAGA: “Make crypto great again!”

2. $BODEN ($230M market cap)
   This is the largest memecoin for Biden. It’s a parody of Biden that pokes fun at him for being old, sleepy, and even wearing a diaper. There are no taxes related to this one.
   

   Anyone else feel like this after eating lunch

   — lolol.eth | jeoboden.eth (@housetechnolove)
   5:23 PM • Apr 1, 2024

3. $TREMP ($106M market cap)
   This is a parody of Trump by the same developers as $BODEN. No tax on this one either. It’s the smallest but up and coming.

If you’re feeling a little offended or think this is childish, that’s part of the appeal. It makes the media talk about it—people buy it as a way to thumb their nose at politics.

The Presidential Memecoin Thesis

When financial professionals want to make an investment, they put together a “thesis,” which is a fancy way of saying, “Here’s why I think it’s a good idea to invest.”

But it can be a little more than that.

Done well, it lays out each argument with data supporting why you think it’s good idea.

If any one of these arguments turns out to be wrong, then it puts the whole thesis at risk of being invalidated.

So below is my thesis for why I think Presidential memecoins could outperform this cycle, and any one of these tenets could turn out to be wrong:

1. We’re in a crypto bull market that will continue through the presidential elections.

In my opinion, as long as the S&P 500 ($SPX) continues to make higher highs, bitcoin and crypto in general will likely follow.

In the recovery since the 2022 lows, $SPX has generally moved to new highs first, followed by bitcoin, and then the rest of the crypto market.

Within just the last few weeks, SPX made another new high, and I believe it will continue to do so through the end of the year.

On the monthly timeframe, RSI for $SPX look quite healthy at 66. Both price and RSI are making higher highs and higher lows. The April pullback was bought up quickly showing good demand for $SPX.

As long as this trend continues, crypto will likely follow and continue to benefit.

2. The presidential election will bring attention to presidential memecoins—and money.

We’re already starting to see glimmers of this happening.

For a Trump rally in Michigan on April 2, the team behind $BODEN offered 1,000 $BODEN to anyone who brought a $BODEN sign to the Trump rally.

Three people took them up on it, and Yahoo! Finance wrote a story about it.

Then price rose over 300% in the next 7 days.

As the election gets closer, the media will only be searching for more stories like this related to the election.

And if crypto is roaring and people are making money, it’ll only bring more attention to this category and push valuations higher.

3. Presidential memecoins have a lot of room to grow.

The two biggest memecoin entrants this cycle are $PEPE, which has about a $4B valuation, and $WIF, which has about a $2.3B valuation.

The three presidential memecoins listed above have a combine valuation of $0.8B.

They’re babies in comparison.

In fact, in the memecoin category of CoinGecko, there are 10 memecoins bigger than $MAGA, 15 bigger than $BODEN, and 27 bigger than $TREMP.

These include ones I hadn’t heard of before, like $CORGIAI and $APU.

If $MAGA got to the size of $WIF, it’d be a 5-6X move, and $BODEN would be a 10X move. At $PEPE, $SHIB, or $DOGE valuations, it would be even more.

If the general crypto market also expands over this time period, then the multiples could be bigger too.

However, presidential memecoins are a very new category, so there’s not much precedent for how big it can get, and we can only speculate. 85% of the value of the memecoin category are dogcoins and pepecoins, and so this is an unproven category.

4. Presidential memecoins have a wide appeal

When you think about who would buy a memecoin like this, it can be anyone who:

1. Wants to express an opinion about the election

2. Thinks it’s funny—and wants to tell their friends about a funny thing they bought

3. Wants to speculate and make money on the election

Because the coins are mainly available on DEX’s and not Coinbase, it does appeal to a more crypto native audience.

The charts

Alright, now that the thesis is out of the way, let’s dive into the charts.

$MAGA

For the last three months, $MAGA has been in a range between ~$4 and $10.

It’s currently toward the top of the range ~$8, and could have some support ~$6.6 if it continues to retrace back to the trending dots on the Sharp Shooter indicator and some of the previous closes.

New daily closes above $9.90, and we’re back into price discovery mode.

$BODEN

$BODEN has been trading in a range of $0.25 to $0.90 over the last 55 days.

It’s had a bigger retrace of 80%, and is currently bouncing above the trending dots. RSI has broken the downtrend, and price has broken the downtrend on a closing price basis but not based on wicks.

We still haven’t seen a higher low put in yet, and RSI is still below the 50 on RSI. We’re looking for that higher low next.

$TREMP

$TREMP is in price discovery mode right now making higher closes.

$0.83 can potentially act as support in a pullback, and then fib extensions show higher targets at ~$1.63 and ~$2.95.

How to trade political memecoins

The same RSI based strategies that Jesse teaches for bitcoin also apply to memecoins.

For instance, $BODEN put in bearish divergence where price made higher closes and RSI made lower closes before it dropped 80%.

If you want to learn more about those strategies check out his site.

However, these assets are more volatile than bitcoin, which means you have to be decisive in taking profits, or it’ll reverse on you quickly.

My general approach will be to do little trading with these, and instead hold up until a few days before the election. I’d expect election results to be a sell-the-news event.

How to buy presidential memecoins

Unfortunately, you can’t buy them on Coinbase, and it’s doubtful that Coinbase wants to take the political risk of listing them (though I could be surprised).

To buy, you’ll probably need to use a decentralized exchange on Solana.

To do that, you have to:

1. Add the Phantom browser wallet extension on your browser

2. Buy some $SOL on an exchange, like Coinbase

3. Transfer that $SOL to your Phantom wallet

4. Trade the $SOL for $MAGA, $BODEN, or $TREMP

If you haven’t done this before it can be intimidating. But it’s worth learning how to do it. You’d be directly participating in crypto then!

What do you think?

Ok, I laid out my thesis, but what do you think? Am I full of it? (The answer might be yes!)

Want more of this? Less? Too detailed? Not detailed enough? Let us know!

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Disclaimer

The contents of this newsletter are expressed in my opinion only, none of which is financial advice. Always do your own research as this information is intended for educational & entertainment purposes only.