The Wolf Den #207 - Maximalism
Bitcoin Thoughts And Analysis
DAILY CHART
Beautiful reaction to the 50 MA. That's all for now.
6-HOUR CHART
While price failed to confirm bullish divergence on the 4-hour chart, it did manage to do it on the 6-hour, which is another time frame that I frequently watch and is popular among stock traders. This should be a decent bottom signal. At this point, the 4-hour did manage to hit oversold and has moved up. If we see another price drop, I would expect a sizable bullish divergence on the 4-hour as well. I think the bottom is either in or very close, but my opinion is not tradable.
4-HOUR CHART
Beautiful reaction to strong support in a demand zone. The problem? Volume. We have seen no real buying aggression from that perspective, so it's wise to still remain cautious. Also, you can see that this was the retest of the 200 MA that I said I expected, so we really want to see price trading above that, not below as it is for the moment.
Again, if we see another drop, I expect it to potentially create an oversold bullish divergence on this time frame and to be the bottom. Not particularly worried about much more downside at this point, but it's certainly possible.
HOURLY CHART
As I said, pennant often fail and become flags. On the hourly line chart we can see this displayed clearly. Perfect flag. Bullish divergence helped predict this move. Price made it back to the just below the EQ of the flag, so we really need to see a push into the top half to convince me that we are ready to make a larger move up.
Bottom line - the bounce was expected to this area... now we need to watch and wait and see if buyers step in to clear a lot of resistance on multiple time frames/
Altcoin Charts
ETH/BTC
Update: Ethereum managed to break out against Bitcoin and has now potentially retested descending resistance as support. The candle is not closed, and the volume leaves something to be desired. But technically this is a breakout and retest and could be a GREAT sign for Ethereum and other altcoins heading into the weekend.
SOL/BTC
I like this setup the other day when I posted it - now I love it. It did exactly what I was watching for - it dropped into demand, retesting that area as support, while also retesting the descending resistance as support AND the daily 50 MA as support. I have no idea what will happen in the future, nobody does. But from a technical perspective, that was a golden entry that is easily invalidated with a drop below all of those support levels listed above. I think this should do really well if Bitcoin allows it.
Competitive Advantages
By Sahil Bloom:
To outperform, you need serious competitive advantages. But contrary to what you have been told, most of them don't require talent.
10 competitive advantages that you can start developing today:
1. Intellectual Curiosity
Intellectual curiosity is a real-world superpower. We all have it, but most will never embrace it. For the curious mind, anything is possible. Fortune favors the curious mind.
2. Comfort with Discomfort
We are conditioned to avoid discomfort, so most of us do. The problem Discomfort leads to growth. It is an absolute necessity. If you train yourself to accept and embrace discomfort, you will always have an edge.
3. Simplify Where Others Complicate
"The definition of genius is taking the complex and making it simple." Complexity and jargon are often used to mask a lack of deep understanding. Learn to convey extremely complex ideas in simple, digestible ways. Find beauty in simplicity.
4. High Tolerance for Failure
We fear failure, so most of us play it safe to avoid it. But our greatest moments of growth often stem directly from our greatest failures. Do not accept failure, but do not fear it either. You will fail. Embrace it. Learn to fail smart and fast.
5. Low Time Preference
Life is a long game. Those with low time preference play it more effectively - they happily delay gratification to build real value. In a world of people seeking instant gratification, this is a meaningful edge.
6. Antifragility
In Greek mythology, the Hydra is a creature that has multiple heads. Every time one head is cut off, two grow back in its place. Life is random and chaotic. Do not be broken by this chaos and disorder; rather, adopt a mentality that you will benefit from it.
7. Presence
With the rise of technology - and the instant access to millions of people and things that it has provided - the ability to be truly present has become a rarity. When you are with someone - whether a new business contact, friend, or partner - be WITH them. Be present.
8. Relentless Consistency
Many people are able to produce bursts of energy. Few people are able to produce consistent, steady flows of energy. The former might be flashy, but the latter is relentless. Take pride in punching the clock - in showing up - day in, day out.
9. Noise Cancellation
The world is a noisy place. We are constantly hammered by stimuli competing for our attention. The ability to cancel out the noise - to truly focus on the task at hand - is both broadly applicable and extremely powerful.
10. Be Yourself
The most important competitive advantage. Always be yourself. No one can compete with you, at being you.
Trading Gaps
I wrote this article quite a while ago for CoinTelegraph, but wanted to share it again for those of you have not read it. We hear about CME gaps all of the time, but all gaps are not created equal. Here is the quick summary of the 4 types of gaps, but I suggest you read the entire article.
Breakaway gap — This gap is seen when price makes a strong directional move from an area of consolidation. It is particularly powerful for traders when combined with clear patterns on the chart like trading ranges and ascending and descending triangles. A breakaway gap with significant volume after the gap is a sign of a strong trend and is unlikely to be filled. A low volume move creating the space is more likely to see price returning to the area. Bottom line — breakaway gaps are less likely than other types to be filled.
Common gap — These are also known as area gaps, pattern gaps, and temporary gaps. These are the gaps that traders see most often in trading ranges and during sideways movement. They are often filled but offer very little information on what price is likely to do after this occurs. They rarely exist within a notable price pattern on the chart — they are simply areas where there was minimal trading that is likely to be filled.
Exhaustion gap — This type of gap is viewed as a signal that a trend is ending and that a new pattern or trend is likely. They occur near the end of a price pattern and signal a final attempt to hit new highs or lows. Exhaustion gaps generally occur in an area of rapid advance or decline, often on a large move straight up or down. They are normally preceded by a heavy volume spike and often foreshadow a “blow-off top” in an uptrend. These are the most likely gaps to be filled.
Measuring Gap — also known as a runaway gap or continuation gap these gaps occur in the middle of a price pattern and signal a rush of buyers or sellers who share a common belief in the underlying asset's future direction. Measuring gaps do not occur during consolidation or in an area of congestion. They occur during a rapid price incline or decline. Runaway gaps are not normally filled for a considerable period of time, if ever.
GBTC Discount At All-Time-Low
The GBTC Trust has historically traded at an average premium of 10-20%.. Since mid-February that premium has dropped below 0 to an all-time-low discount of nearly 15%. This is simply a result of global ETF approvals, U.S. ETF proposals, new investment vehicles, and negative market sentiment. If you are a long-term believer in GBTC’s success, then buying it right now isn’t a bad idea. It’s like buying Bitcoin at a -15% discount. If you don’t have long-term conviction in the product, this should go without saying - don't buy it!
One thing is for certain - at the moment, the GBTC arb trade that so many institutions and accredited investors have been taking advantage of is dead.
Record Bitcoin Options Expiring Today
With an increase in investable products offering Bitcoin derivatives, this month-end marks a record number of options expiring, totaling just over 100,000 BTC. The breakdown between puts and calls is almost exactly a 50-50 split. Call open interest is only a fraction lower than put open interest, together totaling over $6B in contracts. The tweet above mapped out the recent Bitcoin bottoms, all of which aligned with the last Friday of each month - when options contracts expire. After each of these expirations, Bitcoin has successively gained 80%, 99%, and 44%. If the pattern repeats, April should be a big month. Historically it is the greenest month of the year since 2012. As the saying goes, “past performance is not indicative of future results” but history does often rhyme.
News Review In Full
I have been trying to supplement my news content from the newsletter later in the day on YouTube. This is my news review from yesterday.
KickPad - Fair IDOs on Binance Smart Chain
KickPad aims to be one of the main IDO and presale platforms on BSC, bringing presale opportunities to the average crypto user while minimizing rug pulls and risk.
KickPad's ecosystem primarily offers two things:
1. An IDO platform where you can join exclusive initial digital offerings by holding $KPAD tokens. There are two ways to participate here: a private sale (higher tier) and a public sale (lower tier). The IDO platform reveals the intent of the $KPAD utility token. Unlike traditional IDOs, where getting an allocation is a game of chance, KickPad grants you allocations based on the amount of $KPAD tokens you stake or own. If you do either, you will receive a "pool weight score."
Staking gives you access to private sale allocations while holding gives you access to public sale allocations. The allocations are given based on a formula called the "pool weight score". These releases are more heavily involving the Kick team. Through a secure vetting and screening process, new projects can bring a lot of value with minimal risk to the community. The procedure is stringent, demanding, and transparent.
2. A presale platform called KickDex on Binance Smart Chain that automatically adds liquidity to PancakeSwap. KickPad lets you invest in presales while knowing that liquidity will be added and LP tokens will be automatically locked up. Liquidity tokens are automatically locked for a specified period, preventing rugpulls. This whole process is transparent and fully visible to the buyer.
The flow diagram below depicts the entire KickDex process, from the sale to the final LP tokens unlocking after the lock period expires.
Current Official Partnerships:
DuckDAO: https://medium.com/duckdao/kickpad-joins-the-duckdao-ecosystem-as-a-strategic-partner-4b87c0eb3dde
Orion Protocol:
https://blog.orionprotocol.io/kickpad
Current Audits
Zokyo: https://kickpad.medium.com/kick-x-zokyo-audit-47d11bcc45f0
Hacken: https://kickpad.medium.com/kick-x-hacken-audit-3bd587403ed2
Solidity Finance: https://kickpad.medium.com/kickpad-x-solidity-finance-audit-917aa3a3a9ab
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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.