Summary Global X Blockchain ETF is a Bitcoin-heavy fund that owns companies benefiting from the increased adoption of blockchain technology. BKCH is highly concentrated, with 55% of the fund held in just three names: Coinbase, CleanSpark, and Marathon. The fund is well-constructed for a direct and volatile bet on Bitcoin but carries significant risk and is not a long-term investment. The rally in alt-coin OG Bitcoin (BTC-USD) has taken the world by storm (again). We're in the midst of a massive bull run and crypto-related stocks and ETFs are flying once more as well. One way to take advantage of a Bitcoin-related bull market is to own themed funds that are designed to take advantage of higher Bitcoin prices, like the subject of this article. That fund is the Global X Blockchain ETF (BKCH), which is a highly concentrated (i.e.: non-diversified) fund that owns companies that it believes benefit from increased adoption of blockchain technology. Now, in practice, this means the fund is extremely Bitcoin-heavy, including miners, hardware, and digital asset transactions. It seeks to track the Solactive Blockchain Index, which you can read more about in the fact sheet . The end result of all of this is a list of less than 30 holdings for the fund, but even more interesting is that 55% of the fund is held in just three names. When I said it was non-diversified, I really meant it. Fund website The top holding, Coinbase (COIN), is obviously the big player in crypto exchanges, and trades quite closely correlated with Bitcoin itself. CleanSpark ( CLSK ) and Marathon ( MARA ) are two big miners of the coin itself, so it's a completely different way to gain exposure to Bitcoin than Coinbase. The rest of the top 10 is littered with miners, and also - kind of strangely - includes a small position in AI legend NVIDIA (NVDA). Looking at the holdings, I think BKCH is honestly well constructed for what it wants to be, which is a very direct and volatile bet on Bitcoin. If that's what you're looking for, I think you can find that here. Before we look at the technical picture, I'll note that the annual expense ratio is about half a percent, so it's modestly priced given it's an active fund. Second, the risk profile is unsurprisingly high. Annualized volatility is ~76% right now, about 6X that of the S&P 500. This isn't a buy-and-hold fund you get for your grandkids; this is a trading vehicle that is very useful for riding crypto bull markets and carries with it significant risk. With that out of the way, let's dig into the price charts to get a sense of where we may see this thing go. Another breakout incoming? That's the big question, and if I had to make a guess right now, I'd be shocked if we don't see it. Whether it happens next week, next month, or whenever is up for grabs. But this chart looks like it wants to go a lot higher, and as we'll see in the component analysis, there's similar behavior from the largest holdings. StockCharts We have a massive ascending triangle forming right now that started with the October low last year. BKCH put in a spike high of $56 in December before getting obliterated and finally bouncing off of $30. It nearly doubled before its next pullback, but importantly, the pullback was really not that close to the trend line. The bulls are eager to keep pushing this higher, and so long as that up-sloping line holds, I see no reason we don't get a breakout. The PPO histogram is now positive again, and the PPO itself turned higher before even testing the centerline. Everything looks good if you want to be long. Finally, the correlation to Bitcoin itself is somewhat surprisingly low at +0.74 but is still quite positive. That obviously makes sense, but it's certainly not a direct replacement for owning Bitcoin itself by any means. I'll note the relationship was actually negative for a brief time last year so strange things can happen. Big holdings support higher BKCH prices Let's now take a brief look at the three biggest stocks in the fund, which make up the ~55% we looked at earlier. First up is Coinbase, which actually made a new closing high on Monday with Bitcoin-related stocks flying once again. Coinbase has been on an absolutely incredible run, bottoming at $70 in October, and trading for ~4X that level today. StockCharts I don't actually like the look of the PPO at the moment, but raging bull markets can work through extremely overbought conditions. The correlation to Bitcoin here is nearly perfect at +0.97, so this one is trading basically in lockstep with the coin itself. More on that below where we look at Bitcoin itself. Technically, so long as this one holds the 20-day EMA, which is all the way down at $234 but rising sharply, it's a long candidate. I'll say out of the three top holdings, this is the one that makes me the most nervous. But a breakout is a breakout, and it's innocent until proven guilty, so to speak. Next up is CleanSpark, which makes Coinbase's ~4X move look like child's play; CleanSpark is ~7X its October price today, adding another 20% to its price on Monday. StockCharts Correlation is really strong on this one as well, at +0.83. Unlike Coinbase, I actually really like the PPO as it's turned higher (quite sharply) at just the right time after some consolidation. CleanSpark threatened a big breakout on Monday but didn't quite get it. Is Tuesday the day we get a new high? Regardless of the answer to that question, I see it as more of an inevitability with the way this one is moving. Lastly, we'll take a look at Marathon, which is the only one of the three that has a Quant Rating of Strong Buy (the others are both Hold-rated). StockCharts Marathon's correlation to Bitcoin has broken down to an extent, as it sits at just 0.38 today. They are normally pretty correlated, but Marathon is in one of those periods where the relationship breaks down. At any rate, the PPO is bouncing, but below centerline support so it's less bullish than CleanSpark for that reason. However, we also have an ascending triangle in Marathon, so the same principle applies; any price over that trend line is good for a long candidate. Before we wrap this up, let's take a glance at the coin itself to see what clues we can glean. StockCharts We have what appears to be the recipe for a big breakout coming, with price coming nowhere near the upsloping 50-day SMA, and the PPO turning sharply higher well above the centerline. It is my opinion it is just a matter of time before we see Bitcoin breakout and go much higher, but we'll have to wait for confirmation. This chart, for what it's worth, continues to look extremely bullish to me. The bottom line If you're still with me, you're probably pretty bullish on Bitcoin. I happen to agree, as I've been saying for some time. There will be periods of selling, although it may not feel that way with the way the coin has rallied recently. If you're looking to take advantage of Bitcoin's price action in a way other than owning the coin, I think BKCH is a good choice depending on your goals and risk tolerances. This one is risky ; make no mistake about that. It makes massive moves in both directions, offers big rewards if you're right, and big losses if you're not. Use stops to limit downside risks, and take profits on the upside. I like the setup of BKCH on the chart, as well as Bitcoin itself, and even the larger components of the fund. But that guarantees us nothing, so please be prudent if you decide you want to take a position. I like BKCH right now enough that I'm putting a Buy on it. So long as we don't get any major price breakdowns as noted above, I think this is going a lot higher after it makes the breakout over the $56/$57 double top. We shall see.
