The Wolf Den #138 - The Destruction Of Value
Bitcoin Thoughts And Analysis
Bitcoin went up. Way up. We have had some incredible trade opportunities. Now that we are in price discovery, it's hard to utilize charts until we see some more patterns and levels develop. I remain long on this round from $17,700 (last trade was long from $16,300). There was also a less than terrific long in between those that stopped out! Win some lose some. That was a tiny loss, sandwiched between 2 massive gains.
Same chart that I have been sharing. Targets of that bull flag have been smashed. Normally I would have completely exited, but I view this as a unique opportunity to ride a leveraged long into price discovery. That said, I have no idea where price is heading. RSI is at almost historically high levels on lower time frames, this is going to eventual retrace or consolidate. Trying to short it or figure out when is a fool's errand. As an investor, I will continue to blindly average in and buy every dip. As a trader, I am waiting for more clarity but already in a position.
Altcoin Charts
Even as altcoins have stalled on their BTC pairs, we have seen some AMAZING trades this week. COMP, LINK, EGLD and SUSHI all still look very solid, shared in the past few days. I remain in all of them.
As an investor, I remain VERY bullish on Ethereum. I think it will eventually catch up to Bitcoin and it is currently trading at 50% of it's all time high.
For transparency, below are my three current trades on Phemex, each with 10x leverage. Bitcoin, COMP and LINK. I have shared this a number of times in the past few newsletters. I am still hesitant on alts in general today, as Bitcoin continues to rage. I am sure we are going to have some epic alt setups on Bitcoin pairs in the coming weeks.
Today, there's nothing jumping out at me that I have not already shared.
EGLD/BTC
This dipped hard. Good! We were watching this on the livestream yesterday and I drew the blue path that I would love to see (this will NOT happen!). Yes, price dropped below support, but now we have a POTENTIAL (wait until daily close to trade this) dragonfly with a long lower wick and small body at support. If this closes above 1000, I would say it has a really good chance of heading up. Nice potential reversal candle (still need to wait) right at support. Exactly what we were looking for. 1000 was the entry that I shared.
I trade this on the USDT pair now because I am on Binance.US
My stops would be below the next support, in the 780s. Size position accordingly.
To be clear, I would wait for the daily close now to enter if you did not catch a trade already.
LINK/USD
This has already hit the first two targets - the blue supply zone and the next horizontal resistance. Amazing. However, I am still in it, although I took 25% off the table at the black line. If I were looking to enter LINK now, I would watch for either a drop back to the blue zone as support, or a break of the overhead black line and retest as support. There is NO TRADE ON THIS right now between levels. The best entries are below or above, depending on what price does.
Legacy Markets
DXY (DOLLAR INDEX)
I have been screaming from the highest mountain top all year that the dollar was likely to drop in epic fashion. Here we are. When price was rejected with that huge wick up at the EQ of this ascending channel in March, it was clear to me we were going down. Others have been bullish, but we have seen nothing but doom for the dollar. Just 2-3 months ago, people were calling for a reversal as I calmly pointed out that this was simple a retest of the former channel support as resistance. Dollar down. This drop is why we are seeing everything else rise. Dollar down, stocks, Bitcoin, metals up.
This is a chart showing Bitcoin and the dollar, both indexed to 100. Could not be more clear what is happening. As long as the dollar drops, everything else should continue to rise.
XAG (SILVER)
I bought this breakout on silver, even though I am already in a position. If you have been with me a while, then you likely already traded more than a 2x move. The bull flag that I have been sharing broke out yesterday on the daily and has been retested as support. Target is shown based on the length of the flag pole.
Nothing is certain, but this technically looks great.
Chart Requests
Here are all of the chart requests as of yesterday. They are in the following order:
$BQX $DIA $DKNG $LINK $MARA $NU $OMG $SCRT $TSLA $YFI $YFL $ZIL $ZM
Terra Virtua - Bringing NFTs To The Mainstream
Although I am primarily known for trading, I also heavily invest in projects, platforms, and ideas related to the crypto space, especially those that are collaborating with sectors extending beyond blockchain.
Investing in Terra Virtua’s presale was a no brainer. They bring together crypto, blockchain, NFTs, and art, all things that I am passionate about.. One of the most prevalent criticisms that outside observers have about NFTs is that the owner can't enjoy their collection - an NFT can't be nailed to a wall in their house like traditional art. Terra Virtua solves this problem by offering a digital gallery for NFT collectors to store and interact with their collections through mobile, AR, and VR while also connecting with other aficionados. As an investor, I believe in NFTs and am confident they will grow, but I am looking for companies that understand how to bring NFTs to the mainstream.
If you want to read my full blog post on Terra Virtua, the blog is linked above. I am truly excited about this company.
Bondly - Revolutionizing Escrow And NFTs
Bondly is another platform that I took an early investment in and wanted to share with all of you. If you can't tell, I am really excited about NFTs! DYOR, I am not telling you to buy it. I just like to share the projects that I believe in.
Bondly is an interoperable, transparent, and portable swap protocol designed to revolutionize traditional escrow methods and make everyone into their own digital marketplace. Bondly’s family of trust-enabling DeFi products is designed to be a part of everyday buying and selling activities, giving peace of mind for swap or online purchases. Bondly’s product BProtect is a DeFi enabled eCommerce gateway specializing in integrating into your favorite online marketplaces very simply and easily with no integration fees, just staking tokens.
Aside from Bondly’s revolutionary DeFi products, they have also put their hands up as pioneers in the NFT space with the introduction of their Bondly Collectible Card Game. BCCG is a fully digital, NFT based, collectible card game that adds immense utility, educates about their family of products, and incentivizes gamers to participate in their ecosystem. To date, Bondly has seen total trading volume of 1934 ETH, they are consistently featured on Openseas leaderboard and they have a die-hard community of over 10,000 members interacting daily with their NFT products.
Bondly isn’t doing this alone either, having secured industry-leading partnerships with the likes of Chainlink, Cardano, and Binance Smart Chain - to name a few.
With their TGE and staking having gone live on the 8th of December, their progress and results speak for themselves. 2.25 million Bondly tokens were staked in their staking pools which filled up in less than 12 hours. 1.5 million Bondly tokens committed to their liquidity pools and a total of $320k staked in a ZERO APY pool for the chance to win their most rare NFT.
Most recently, Bondly has partnered with Binance Smart Chain to introduce a new wave of NFTs to the greater crypto community. Bondly will be bringing The BCCG to BSC, driving adoption of the NFT world and BSC’s NFT ecosystem. This partnership will allow Binance Smart Chain to connect with their community on a deeper level through the development of the BSC NFT Ecosystem. Bondly will work with BSC to launch exclusive Christmas Edition NFT cards on BSC with unique utilities.
It is clear why Bondly will be here to stay - world-class partnerships, revolutionary DeFi products, and proven adoption will ensure continued growth and success of the platform. We wish them all the best.
Livestream Today With Beniamin Mincu, CEO Of Elrond
As you know, I am a huge fan of Elrond and have been an investor and proponent for ages. My podcast interview with Beniamin was one of my most popular ever, so I invited him back for a livestream to discuss everything that is happening with Elrond and eGLD. You don't want to miss this - it's at 2 PM EST today!
Guggenheim CIO Puts Bitcoin At $400,000
In a recent interview, Scott Minerd, the CIO of mega-fund Guggenheim, said Bitcoin’s value should be about $400,000. The only thing the interviewer could respond back with was “woah,” as Minerd provided two reasons for his evaluation. His reasoning was “scarcity” and “relative value to gold as a percentage of gross domestic product.” Random predictions like these are akin to throwing darts blindfolded while hanging upside down, but statements like these coming from fund leaders are still eye poppers. Hopefully Guggenheim puts their money where their mouth is.
Billionaire Allan Howard Is Backing A Crypto Hedge Fund
Reports like these are popping up left and right. The key here is two small tidbits buried in the article. The new hedge fund is looking to buy both Bitcoin AND Ethereum. Slowly but surely, institutions are coming around to Ethereum in the same way that they started whispering about Bitcoin months back. Institutions might be staying quieter on the asset as they race to buy it behind the scenes, but the price will soon likely reflect growing institutional interest once it catches on in the mainstream. The second important part of this report is that the CEO of the fund, Eric Peters, said, “there is going to be a generational allocation to this new asset class." This is a narrative that hasn’t caught a lot of attention, but seems reasonable. If younger generations continue to support crypto, we could see prices at levels that are hard to imagine.
Robinhood Lied To Customers
Robinhood agreed to pay a $65 million civil penalty, without admitting or denying SEC's findings.
No surprises here.
"Between 2015 and late 2018, Robinhood made misleading statements and omissions in customer communications, including in FAQ pages on its website, about its largest revenue source when describing how it made money – namely, payments from trading firms in exchange for Robinhood sending its customer orders to those firms for execution, also known as ‘payment for order flow,’” the SEC statement read.
“One of Robinhood’s selling points to customers was that trading was ‘commission free,’ but due in large part to its unusually high payment for order flow rates, Robinhood customers’ orders were executed at prices that were inferior to other brokers’ prices,” the statement went on to say.
The millennial favored trading app is best know for pioneering the “commission free trading.” Robinhood, and the rest of the online brokerage industry, rely on what’s known as payment for order flow as their profit engine in lieu of commissions."
The Wolf Of All Streets Podcast Ft. Sam Bankman-Fried
Sam Bankman-Fried has quickly become a crypto legend. He graduated college as a Physicist but chose to pursue a career in finance, with the intention of making and donating as much money as possible. Sam discovered his innate ability to spot inefficiencies in global markets and transitioned to crypto to capitalize on his incredible skill set. Now he casually manages billion-dollar arbitrage trades through Alameda Research while providing liquidity and endless trading options to crypto traders through his top 10 crypto exchange, FTX. Sam’s insight into crypto liquidity sheds a clear light on the practices of Bitcoin whales and is essential to understand as a crypto trader or investor.
Sam and I further discuss trading a billion dollars in a day, executing orders in stealth, arbitraging money around the world, looking at 6 monitors at once, billion-dollar capital management, front running orders, injecting liquidity, the golden parameter of trading, preventing a Bitcoin leverage meltdown, scaling the industry for institutional money, dominating liquidity and more.
My Recommended Platforms And Tools
This is where I trade with leverage and can also trade spot with no fees.\
This is where I spend my days teaching and learning! Our Discord group is a one stop shop for everything you need to learn to trade and control your emotions. Feel free to DM me on Twitter or respond to this email for questions.
This is where I invest, commission-free. They now let you earn interest on your Bitcoin held in Voyager, so you can compound while trading. Not only that, you’ll get $25 in free BTC when you download & fund.
Rewards Code: Scott25
I use RoundlyX to buy small amounts of Bitcoin every single day. They automatically round up my credit card purchases (with 10x multiplier) and invest them in crypto. Absolutely brilliant. Passively invest money you don’t need without a thought. Further, they have integrated with Voyager (see above) to offer commission-free purchases.
Rewards Code: WOLF
Binance is finally available in Florida!
Concierge Phone Service for Americans that protects your from SIM Swaps and other phone related hacks. I cannot stress enough how amazing this service is.
Follow me on Twitter at @scottmelker. This is where I am constantly updating my trades and sharing ideas.
On-chain and fundamental analysis, research, predictions and indicators, all in one place. Highly recommend.
The views and opinions expressed here are solely my own and should in no way be interpreted as financial advice. Every investment and trading move involves risk. You should conduct your own research when making a decision. I am not a financial advisor.