The Wolf Den #192 - More Reviews Coming Soon
Bitcoin Thoughts And Analysis
As I said yesterday, trading Bitcoin right now is a recipe for getting chopped up. TA is very difficult at the moment, and anyone who says they have a great idea of what is going on is likely wrong. Here are a few ideas, but I have low conviction in any moves right now. It's fine to admit when you don't know what is coming next.
4-HOUR CHART
We can see above that we had a ton of selling, with each small move up being immediately dumped back down. The evidence is the constant up wicks. That tide has now turned at lower prices, with 3 consecutive candles showing buying demand - down wicks. Price looks like it is reversing now, at least temporarily, with the current candle engulfing the previous 4. Still, this is all sideways action for the moment and difficult to trade, unless you are scalping on low time frames. If you are doing so, the chart right now says reversal to the upside.
This is JUST an idea to give some perspective. If Bitcoin was to repeat the price action of early January, it would look something like what I have drawn above. In January, price corrected for 31 days and roughly 31%. Price could retrace further down and still end up going much higher. We are effectively ranging now, with little clear direction.
HOURLY CHART
If you were watching RSI on lower time frames, then you likely spotted this nice bullish divergence on the hourly, signaling the small reversal.
Altcoin Charts
DOT/USDT
I really like this setup - not because I am sure that DOT will continue up, but because we have ascending support with a very tight invalidation. If price continues to rise, you can trail your stop loss up below that ascending purple line and into profit. If support breaks with a candle below, you can exit at a very small loss or even.
Regardless, DOT is clearly bouncing from support right now, after showing nice demand with a few down wicks on the past couple of candles. Now it's moving off of support and engulfing the previous candles. Let's hope it closes that way, but this looks good at the moment.
Memento Mori
By Sahil Bloom:
Memento Mori is a powerful, often misunderstood, philosophical tool for finding clarity and unlocking growth in your career, startup, business, writing, or relationships.
A thread on its meaning and how it can change your life...
Memento Mori is a Latin phrase that translates to "remember that you must die."
A favorite of stoic philosophy, it is a reminder of the certainty and inescapability of death.
It is not intended to be morbid or dark; rather, to clarify, illuminate, and inspire.
Memento Mori - the idea of remembering your mortality - has been around for millennia.
The phrase itself is believed to have originated in the Roman Empire.
After military victories, the heroes were paraded through the streets on chariots.
They may have felt like Gods...
But the Romans would place one person in the chariot whose sole responsibility was to whisper in the hero's ear throughout the parade.
"Respice post te. Hominem te esse memento. Memento mori!"
Translation: "Look behind. Remember thou art mortal. Remember that you must die!"
Memento Mori served as a tool to invoke humility in moments of glory.
It can also be a tool for providing clarity.
The Roman Emperor Marcus Aurelius famously wrote in his Meditations, "You could leave life right now. Let that determine what you do and say and think."
Humans are inclined to hide from death, to push it to the back of our minds.
Marcus Aurelius and other Stoic philosophers taught the opposite.
Bring death to the front of your mind.
Let your mortality serve to clarify your daily motivations.
Let your mortality inspire you.
Beyond the exact phrase, the idea of remembering our mortality has been a constant across time, culture, and religion.
Death is the ultimate equalizer.
We may look different, live in different places, and believe different things, but in the end, we are all the same.
The inimitable Steve Jobs talked about the power of acknowledging his own mortality in his 2005 commencement address at Stanford.
"Remembering that I'll be dead soon is the most important tool I've ever encountered to help me make the big choices in life."
At the time of the address, Jobs had been battling a rare cancer, making his words all the more powerful.
"Almost everything...just fall[s] away in the face of death, leaving only what is truly important...You are already naked. There is no reason not to follow your heart. "
So as you face the coming days, weeks, months, and years of your life, always remember your own mortality.
Remember how precious every day really is.
Do not hide from it.
Embrace it.
Let it motivate and inspire you.
Let it be a call to action.
Memento Mori.
Options Traders: Oddz Might Be Right For You
Right now, there is an explosion of crypto options and futures desks opening across legacy financial institutions. Just days ago, Goldman Sachs announced the reopening of their own in-house crypto futures desk after a 2-year absence. What doesn’t make sense is that DeFi traders and investors deep in the emerging market have to take two steps back to trade optimal derivative products. The worst part is these outdated centralized systems aren’t compatible with blockchain and smart contract platforms. Oddz fixes this.
Oddz is a trustless On-Chain Option trading platform that expedites the execution of call and put option contracts, conditional trades, and futures. With the introduction of derivative products for Bitcoin, we have seen an influx of larger players that were historically sidelined. Oddz will behave similarly in that it will open up the DeFi markets with fractional trading, transparent premium calculations, adequate liquidity, connection to Binance Smart Chain, customized option writing, and more. If you’re into DeFi and Options, Oddz could be a good combination for you. You can read more information in their Medium article above.
Dogecoin Gains Real-World Use Case
Dogecoin has always been an entertaining meme, but thanks to Mark Cuban, owner of the Dallas Mavericks, the token will be accepted as a form of payment for merchandise and tickets. Dogecoin now officially holds more utility than many coins. Mark Cuban was smart to associate his team with the currency - the announcement was more than likely for publicity rather than because Doge is an optimal payment solution. It will probably pay off in the long run, as Dogecoin continues to move through hype cycles and the Dallas Mavericks have a connection to millions of crypto newcomers with each cycle.
MicroStrategy Stock Has Taken A 50% Hit
MicroStrategy, the business intelligence company known for buying Bitcoin, has seen a significant drawdown in its stock price. About a month ago, the stock hit an all-time high of $1,315 but has since dropped to a low in the $600s as of Thursday after hours. If you’re thinking the stock price is correlated directly to Bitcoin’s recent correction, you are wrong. When Bitcoin hit its 58K peak on February 21st, MicroStrategy had already been correcting - since February 9th. Bitcoin’s correction has likely caused further downside, but it can't be the sole catalyst. Tesla also saw a decrease in its stock after announcing its Bitcoin addition to the balance sheet. Not only are tech stocks in a downtrend right now, but announcing you own Bitcoin could cause some investors to back out of their holdings.
Also, keep in mind that MicroStrategy’s stock price was $135 when it first bought Bitcoin. Since the first purchase, the stock did a 10x, bringing the market cap of the company up with it. Now their Bitcoin is only worth $3.3b and it's reasonable to believe that the revenue of the company hasn’t increased in their core business. All in all, MicroStrategy’s stock is caught in a whirlwind of factors including hype, causing the epic price swings. If you believe Bitcoin will once again reach new highs and tech stocks will eventually turn around, then right now you are looking at a stock that's more than half off.
Powell’s Comments And The Crypto Market
If you want a great summary of Jerome Powell’s most recent comments, linked above is an excellent thread. In short, Jerome played it safe without giving into stimulus demands, likely causing a further pullback in all markets.
Leave Bitcoin Alone
I had a few choice words for the critics who say that "Bitcoin is going to end badly."
My Recommended Platforms And Tools
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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.
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The platform I am using for my taxes. My trades were automatically imported after setup and displayed nicely. The tax report was quick and easy to create in the app. I can also track the performance of my assets in the app. With Blockpit, I no longer have to worry about realizing profits or losses in time. 10% discount using the link above!
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. 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.