The Wolf Den #261 - Be An Investor First
Bitcoin Thoughts And Analysis
DAILY CHART
Beautiful daily candle yesterday, confirming the hammer candle reversal the day before and engulfing the previous few days of price action. MACD continues to look strong for a reversal as well, and volume has at least seen a small uptick on the move north.
Bitcoin seems to have recaptured the range EQ around 36K a very key level to flip to support, which it has done convincingly on lower time frames. We now want to see the 35-36K region hold as support, which would give some confidence that we are heading back to the range highs and a retest of the 42K area. That is still the line that truly matter, for now. The trend is bearish until price is closing candles above 42K.
Price needs to close above $39,219.88 to invalidate hidden bearish divergence after the last bullish divergence, with is now confirmed. That would be a great sign.
4-HOUR CHART
If you were watching the livestream yesterday, price was just passing through the channel EQ and the 50 MA, and in real time I said the retest looked like a good entry. It really was, because that was a strong confluence of support and was the perfect place to scalp a long. As long as we remain above the 50MA and the EQ of the range, this looks decent.
Altcoin Charts
I am absolutely disinterested in altcoins at the moment. I am not taking any trades, not even really considering it in the short term. Rationally, if Bitcoin goes up fast from here, alts will likely get crushed on their BTC pairs, as we saw the past two days. If BTC falls fast from here, the same will likely happen. Sideways Bitcoin here could help alts, but they could also just stagnate. This is just not an optimal environment in my opinion, but I will still share charts sparingly that I see if you are interested.
BTC DOMINANCE
We had a brief moment where Dominance dropped again, but now it is rising with strength on the Bitcoin move. That is generally bad for altcoins. We just had an epic alt season on the major drop, mostly in large caps. So now we have Dominance bouncing from support with Bitcoin looking volatile and a higher low on Dominance. Not ideal at the moment for alts.
DOT/USDT
This technically just broke descending resistance and retested it as support. This is a USDT pair, so it will largely do what Bitcoin does, and will likely underperform that move. I am not interested, but the chart does look good here for a move up to the top of the descending line or even the horizontal resistance above. A break below the descending support would be a sign that this setup has failed.
Legacy Markets
AAPL (APPLE)
Apple is in an interesting spot, like many stocks. It does like like a potential head and shoulders, although the volume profile is not ideal. A break of the ascending black line would confirm, if there's a volume spike. That said, that line is currently support and price is bouncing off of it perfectly. That is an opportunity for traders, because you can enter on support with a tight stop below and lose very little if it does break down. You can also see the weekly 50 MA below (the ascending blue line), which is usually strong support. So, we have an area of strong support with a somewhat tight invalidation and endless upside. That's a good trade, even if you think it will break down. The safest trade is still a break of the highs at $145.09 and price discovery. That's the move if you are conservative.
Chart Requests
Yesterday's chart request stream was a lot of fun, even though the charts do not look great. It seems likely that it is Bitcoin's turn to shine for the moment.
Find An Accountability Partner
Just like a workout partner, a financial accountability partner is there to encourage you to buy the prices that aren't sexy and sell when prices are rocketing up. Their job is to keep you on your trading plan when your emotions begin to get the best of you. Finding someone of equal or better skill level and a similar mindset is an ideal partner. They can keep you accountable for buying the dip and prevent you from fomoing into trades. The next time you are on the edge of buying a beaten-down coin or stock and you need someone to give you encouragement, looking to a friend in the same boat as you can make the difference between long-term profit and loss. Even the best traders feel discouraged at times, I probably wouldn't have accumulated as much crypto in the bear market if it wasn't for a good friend that bought alongside me. There can even be healthy competition with a partner. Watching my friend fearlessly buy dips at scary lows has without fail encouraged me to do the same. Investing and trading is a life-long game, do it with a teammate.
El Salvador Will Mine Bitcoin From Volcanoes
The news is only getting better and better. During the epic live conversation held on Twitter Spaces with the President of El Salvador and the entire Bitcoin community, someone asked the president if he had intentions to mine Bitcoin. He answered that he was open to the idea, but hadn't thought that far ahead about the logistics. He mentioned volcanoes as a source of renewable energy and left the conversation at that.
Less than 24 hours after that conversation, the President tweeted pictures of his “state-owned geothermal electric company” working on mining facilities. He literally turned an audience question into an initiative based on reality in less than 24 hours. This now opens the question up as to where the mined Bitcoins will go, potentially turning El Salvador into the first country to hold Bitcoin as a reserve asset. Currently, El Salvador is planning to hold their Bitcoin in an operating trust, but this mining operation opens the door for the country to actually hold the asset as an investment. The story is just really unbelievable and exciting to watch.
Here is an actual well they dug just yesterday to get the ball rolling.
Senator Warren Has Failed Miserably
While politicians around the world are stepping up on both sides of the aisle to support Bitcoin, Elizabeth Warren turned on the Bitcoin FUD button. In her video about Bitcoin, she recycled all of the the ridiculous headlines that we have all heard, including “Bitcoin uses more energy than a country." She fails to see the bigger picture. I have covered this topic tirelessly on the blog and newsletter so I will spare the rebuttal. If you are looking for a good laugh, read the comments on her Twitter post. Let’s just say the Bitcoin community had fun with this one.
As I tweeted yesterday, "perpetuating FUD wastes as much energy as entire countries." It must be exhausting working this hard to lie in the face of evidence.
Crypto In 401(K)
We have seen self directed IRAs become popular vehicles for individuals to hold Bitcoin in their retirement accounts. However, we have never seen this ability within a 401(K) - until now. Coinbase has signed a deal to allow 5% of 401(K) contributions to go to various cryptos - this is a huge step that is going largely unnoticed because of the El Salvador news.
The Wolf Of All Streets Podcast Ft. Tom Bilyeau
Stemming from a deep passion for 360 degree health and wellness, Tom Bilyeu achieved world-wide success as the founder of billion-dollar company Quest Nutrition. Tom didn’t stop there, wanting to teach others what he learned along the way, so he began his second act called Impact Theory — designed to help and inspire people to develop skills needed to improve themselves and the world around them. Now, Tom believes Bitcoin, blockchain, NFTs, and the entire crypto market will play a pivotal role in his pursuit to make the world a better place — plus Tom has shiny, diamond hands.
In this episode Tom Bilyeu explores:
Covid’s existential crisis
Making money vs. investing money
The secret to the universe
Winning the game of money
The neurochemistry of collecting
The danger of betting against Bitcoin
HODLing and entrepreneurship
Building the next Disney
Launching an NFT and blockchain platform
Finding meaning and purpose
Continuing to stack sats
Teaching others how to succeed
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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.