The Wolf Den #219 - Controlling Your Emotions
Bitcoin Thoughts And Analysis
My caution yesterday was unnecessary on Bitcoin (correct on altcoins), as it has ripped to new highs and broken out of the consolidation and range that it has been trading in since what feels like Medieval Times. The bear div on the 4 hour chart was immediately replaced by a hidden bullish divergence, as I hoped, and price reacted. The highest weekly close in history was a good sign of continued bullishness.
DAILY CHART
Bitcoin just temporarily broke above 63K, which was my original target from months ago. More importantly, it is pushing above the trading range on decent volume (not as strong as I would hope for now). I would love to see the daily candle close above the range highs, avoiding a potential bearish SFP if it closed below. If you are looking for a trade, on this candle close you could place bids at the range highs and try to catch a retest of that area as support.
4-HOUR CHART
As mentioned above, the confirmed bearish divergence was replaced with a hidden bullish divergence, effectively canceling the bull div and signaling continuation to the upside. RSI is currently pushing into overbought, finally, after almost making it twice and forming bear divs. Let's see how long it can stay there!
Bitcoin is yet to close a 4-hour candle above the range highs, so I will be watching for that in the coming hours. That would be the first signal that we have avoided a bearish SFP or rejection in this area, where there would logically be strong selling pressure.
I can't find any immediate reason to be anything other than super bullish as Bitcoin reenters price discovery for a new all time high.
Side note, here is a great thread from a few days ago about Bitcoin that is worth reading.
Altcoin Charts
With Bitcoin ripping up to new highs, today is not the day to be trading alts (except for apparently XRP and even LTC, which are both holding strong). As I said yesterday, both in the newsletter and on my livestream, good setups were extremely hard to come by. I think alts (against BTC) hit their local tops this weekend. We saw bear divs, blow off tops, or rejections at resistance across the board.
Alts always catchup when BTC stops moving, but for now they are not worth the risk, in my opinion. That does NOT MEAN you sell your alts, it means I am not entering or sharing new trades for the day.
TIME Magazine Is Into Bitcoin
The time has finally come for TIME Magazine to cover Bitcoin and add it to their balance sheet. Partnering up with Grayscale, TIME is “producing an educational video series on the subject of crypto assets and receiving payments for the work in Bitcoin.” The Bitcoin received for the work will not be converted to fiat and will remain on the balance sheet.
According to official reports, TIME will be the 33rd publicly-traded company to hold Bitcoin on its balance sheet. I wonder if Satoshi will be the person of the year or maybe Bitcoin will appear on the cover? Bitcoin has already made it into the headlines of the highest-ranked publications in the U.S. (such as The Wall Street Journal) but a TIME appearance would certainly feel like more of proper recognition of Bitcoin’s significance.
Is Ethereum Wildly Undervalued?
Teeka Tiwari, an OG crypto investor, thinks the answer is yes. “Ethereum is a bargain and going much higher.” According to Tiwari, he believes Ethereum will surpass Bitcoin as the most valuable asset in the world and rise another 500% this year. To back up this assertion, Tiwari cited both Mark Cuban and Anthony Scaramucci’s views that the asset will end up being dominant.
Riot Blockchain Had A Profitable Q4
This is news from a couple of weeks ago, but I figured it was still worth sharing. One of the largest factors investors should be considering when buying stock in a mining company is the profitability of that enterprise. Q4 reports came back mixed across the board for miners, but Riot Blockchain far surpassed expectations, from an estimated potential loss of $0.08 to a gain of $0.16 earnings per share.
Coinbase Direct Listing Tomorrow
The Coinbase direct listing is tomorrow. It is NOT an IPO. A direct listing means that existing share holders can sell their stock to new buyers, but NO NEW shares are created to raise funds, like in an IPO.
There has been quite a bit of speculation about the Coinbase listing and its potential effect on Bitcoin price. Everyone monitoring price action including myself has their eyes on targets well above 60K, and the listing might just be the news that gets the ball rolling. I honestly think that it "should" be priced in, since everyone has known it was coming for weeks.
It is still my belief that in the long run, Coinbase’s success is merely an indicator of the health of the sector, not a catalyst for Bitcoin to go up in price.
The Wolf Of All Streets Podcast Ft. Raoul Pal
This episode will be live on YouTube at 10 AM EST here - https://youtu.be/vKOtqhL62Kg
From a technical analyst to a macro investor, Raoul Pal has amassed a global audience for his expertise on everything markets. Coining the popular term “going irresponsibly long Bitcoin,” Raoul believes that Governments and their failed policies will drive up Bitcoin’s value and ecosystem to unimaginable levels. It is for this exact reason that the world is undergoing the largest technology transformation in human history in the shortest amount of time.
In this episode, we discuss a range of topics including:
Irresponsibly long Bitcoin
Holding all your money in crypto
Raoul Pal’s house special
Metcalfe's law
Bitcoin’s geopolitical role
Sovereign wealth funds
Opting out of fiat systems
Leaving a mean-reverting world
Global debasement
Throwing away stimulus checks
Entering the exponential age
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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.