The Wolf Den #187 - Mining Stocks
Bitcoin Thoughts And Analysis
Bitcoin dropped again over night, after failing to break above the 50% retracement level that I discussed a few times. The local bull flag and double bottoms both failed as well. Important reminder that TA is just a guessing game and that nothing is certain. Patterns can be technically valid and fail. If this was not the case, everyone would be a perfect trader.
That said, the last drop was on noticeably lower volume and confirmed bullish divergences on basically every time frame from the 6 hour down. Now we just need to be careful and make sure that hidden bearish divergence does not develop, as it's always possible. But I am cautiously optimistic we will see a bounce.
There are some bullish signals.
The CEO of Cryptoquant, Ki Young Ju noted yesterday (and more today, not shown) that massive amounts of $BTC are leaving exchanges still. That means that big players are buying and removing supply from the market.
Also, Bitcoin futures expire on the last Friday of every month at 4 PM London Time. That's about now. We often see selling pressure into the close and then Bitcoin becomes free to trade once again. Worth watching.
DAILY CHART
Too early to tell, but we have a potential reversal candle forming on the daily. Nice long wick down, small body. Many call it a butterfly, some a long legged doji, some a bullish pinbar. We want to see price closing the day above where it is now.
4-HOUR CHART
The small bullish divergence with RSI caused a nice pop a few days ago. After the newsletter yesterday, we had confirmed hidden bearish divergence, which I shared on twitter. Now we have a much more convincing bullish divergence confirmed, form the 6 hour down to the 1 hour. There's a very small potential hidden bear div that I am not particularly worried about, but worth watching. Again, it's small, it's strange, not a major concern. But I would like to avoid a clear elbow down in RSI on this upcoming close. I bought more BTC today.
As you can see, price dropped over night on low volume. Interestingly, if we draw a range for the recent low to the highs where this move topped out, we had a little wick above the range (bearish SFP) before the trip to the bottom. Now we have a little wick below the range (bullish SFP). I like how price held the range lows and popped off on the previous candle. We should be heading back to the range highs. You can also see that we have bullish divergence with the MACD histogram as well as OBV, in addition to the divs shared on RSI.
I made a video about some of this!
Altcoin Charts
I remain cautious with altcoins. If Bitcoin drops again, they would suffer. If Bitcoin goes up fast, they would also likely suffer in their Bitcoin pairs. I know we all want to dive back in, and there are potentially some good bottom opportunities, but for me it seems smarter to let Bitcoin make a firm decisions first.
BNB/USDT
BNB has been raging on the interest in Pancakeswap. It appears to be consolidating for another potential move up, although I would not personally consider buying until it breaks the purple line. There are zones of support below - demand drawn as a channel and then the very clear area where price consolidated that is in the box. That would be a big drop, but I would buy there aggressively if by chance we saw a move that far down. There should be a ton of support in that area in the off chance price returns.
DOT/USD
Similar to BNB above. Looking to hold bottom support but more importantly to break descending resistance. This looks like it is consolidating for another move up.
The Bezos Regret Minimization Framework
By Sahil Bloom
The Bezos Regret Minimization Framework is a simple yet powerful mental model for making important decisions and unlocking growth in your career, startup, business, relationships, or life.
A short thread on how it works and how it can change your life...
Jeffrey Preston Bezos is an American entrepreneur and technologist.
He is most well known as the founder and CEO (soon-to-be executive chairman) of Amazon and the founder of Blue Origin.
A legendary figure today, he may have remained anonymous if not for one key decision.
In 1994, at age 30, Jeff Bezos was a star at D.E. Shaw, a successful quant-focused hedge fund.
He was on a lucrative path.
But he had become obsessed with a new thing called "the internet" and its power to change the world.
He had a vision of participating in that future.
Bezos had a decision to make.
Stay at D.E. Shaw - with a high likelihood of wealth creation and "success" - or leave and pursue his speculative, crazy new idea.
He developed a framework for making this (and many future) decisions:
The Regret Minimization Framework.
The Regret Minimization Framework is simple.
The goal is to minimize the number of regrets in life.
So when faced with a difficult decision: (1) Project yourself forward into the future. (2) Look back on the decision. (3) Ask "Will I regret not doing this?" (4) Act accordingly.
Naturally, we all know what he ultimately decided...
Bezos beautifully summarized the framework and decision in the interview below.
"Okay, now I’m looking back on my life. I want to have minimized the number of regrets I have."
The power of the Bezos Regret Minimization Framework is in its simplicity.
It provides a clear lens through which to see the world.
It separates you from the present-day fears and uncertainties that clog decision-making pathways.
It forces gut and intuition to the forefront.
So the next time you are faced with a difficult decision - in your career, startup, relationships, or life - take a lesson from Jeff Bezos and give the Bezos Regret Minimization Framework a try.
Stone Ridge Receives SEC Approval To Invest In Bitcoin
Stone Ridge, a well-known multi-billion-dollar asset manager interested in high-return investments, just received SEC approval to invest in Bitcoin. Stone Ridge has historically sought returns in single-family real estate, healthcare royalties, and alternative lending with a disinterest in stocks and bonds. As their name implies, their investment thesis has always pushed risk to the edge for greater returns - hence Bitcoin.
A Forbes journalist reporting on Stone Ridge wrote an older article stating that, “the firm’s staff were investing so much personally into Bitcoin that it needed to find a way to store the funds safely. So it created a subsidiary, the New York Digital Investment Group (NYDIG), which has raised $100 million in investment over the past two years.”
With the fund’s approval to invest in Bitcoin, other hedge funds can now invest in Stone Ridge for exposure or go a step farther and seek SEC approval for personal investing. Even as Bitcoin corrects, all of this bullish news will continue to pile up as major players position themselves to capitalize on the current discount before the flood comes.
Elon Musk Vs. The SEC, Continued
Elon Musk gets in trouble with the securities watchdog once again
There is no doubt that the recent Doge frenzy was largely fueled by Elon Musk’s memes and comments hyping up the asset. Sources are now claiming that the SEC is investigating Musk for market manipulation.
It was just last week that Musk controversially tweeted he would incentivize major Doge holders to void or sell their holdings to decrease centralization. Unsurprisingly, the only entity upset with his involvement in Doge is the SEC. It wasn't long ago that Elon and Tesla were sued by the SEC for vague and misleading claims that were also supposedly "jokes."
If history repeats itself, Musk will likely be sued and probably outsmart the SEC like he did last time (his punishment was to buy shares of Tesla which later increased in value). If the investigation does lead to a lawsuit, it will probably bring a lot of renewed attention to Doge and could very well result in another massive retail influx. Doge is a master of capturing attention and could likely spin the lawsuit in its favor.
Singapore Using Blockchain For Covid-19 Test Verification
It's nice to be reminded of the importance of blockchain technology outside of our obsession with price and markets. Blockchain is the future in countless arenas.
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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. Nothing contained in this e-mail constitutes or shall be construed as an offering of financial instruments or as investment advice or recommendations of an investment strategy or whether or not to "Buy," "Sell," or "Hold" an investment.