The Wolf Den #305 - Ignore The News
Bitcoin Thoughts And Analysis
DAILY CHART
There's not much to say about Bitcoin at the moment, which is likely a good thing for altcoins. I won't bother going into much detail on the charts, because they are the same as yesterday.
Price seems to be consolidating after the move from 30-46K. The 200 MA has officially been flipped to support for now, which is key to a lot of traders as a signal that price is likely to head up further. I still think that 42K would be a bullish retest as support, so I am not concerned if that area fails temporarily. We still have some bearish divergence across the board, so I am looking for a bit of retracement before continuation up.
Altcoin Charts
AVA/USDT
Clean breakout through the blue descending resistance and retest as support. Also attempting a break through horizontal resistance.
I have pulled Fibonacci levels from the top to bottom of this entire retracement, which can be used as targets.
Waiting for confirmation of a close above $2.47 is not a bad idea, and would offer some more confidence in this move, but we have seen two major spikes in buying volume of late and this looks good.
LTC/BTC
I shared a setup recently on the LTC/USD pair that has done very well, but now it appears that BTC pairs are starting to heat up. The chart above is the daily, but shows a weekly demand zone in blue. Price bounced nicely here, forming a double bottom that is currently confirming as a bottom pattern. The neckline is not shown exactly, but there is a black line that is resistance in the same area. Technically the neckline of the double bottom is the swing high between the two lows.
Regardless, the real uptrend for me would start with a break of the blue line. I would not want to see price below the blue zone, so I would leave lots of room there for a stop loss if I was trading it.
Legacy Markets
AAPL (APPLE)
Apple appears to be setting up for another move, after consolidating around the previous all time high. If you have been here, we have had a number of recent trades on this stock.
We have a bull pennant here, so the trade would be a break of the upper resistance. I often mention that pennant can break support and become flags, so playing the bottom support can be risky.
Target is shown, roughly. This is based on the measured move of the flagpole and would be measured from the breakout.
Millions Stolen In Largest DeFi Date To Hack
This news is sad. The largest DeFi hack in the history of the crypto space resulted in $600m in lost funds from the Poly Network. Shortly after the hack took place, the official Poly Twitter account announced that the attack occurred consecutively on 3 separate blockchains where Poly operates: Binance Smart Chain, Ethereum, and Polygon. It isn't exactly known how the hack was conducted, but it has been speculated that an anonymous user or group of users found a private key or bug that was then used to exploit the smart contracts. With the ability to break in, locked funds were liquidated and users who conducted swaps were left with nothing on the other side.
2,858 ($266.5m) Ethereum tokens were stolen, the hackers took 6,610 ($252m) BNB tokens and $85m USDT were lifted from the Polygon address. Legal action is already underway, but that does not mean the money will be returned to those affected. In regard to the stolen funds, the hacker left a message on the blockchain that read as follows, “IT WOULD HAVE BEEN A BILLION HACK IF I HAD MOVED REMAINING SHITCOINS! DID I JUST SAVE THE PROJECT? NOT SO INTERESTED IN MONEY, NOW CONSIDERING RETURNING SOME TOKENS OR JUST LEAVING THEM HERE.”
Exchanges and protocols appear to be doing everything they can to make the hacker’s life more difficult. ether has blacklisted the $33m USDT on Ethereum and Binance spoke out publicly that they are working diligently to assist
This is a reminder of the risks associated with investing in this nascent industry, and that we still have a long way to go before our funds are secure. Exploring new protocols, always brings on added risk, even if they are doing their best to protect your money. Yield farming, swaps, and smart contracts are new concepts that should only represent a small percentage of your portfolio. Individuals were not the only ones affected by the hack; many Chinese venture capital funds were also found to be victims of the exploit. I can't stress enough that if you are going to invest in crypto, most of your money should be in the top two coins. Only a small amount of your portfolio should be in high-risk projects - it is always better to be safe than sorry.
Coinbase Blows Away Q2 Expectations
Coinbase reported second-quarter results after market close on Tuesday.
Despite the ups and downs of Q2 crypto market price action, Coinbase far exceeded revenue expectations, causing a 3.5% jump in COIN in late market trading. Coinbase was projected to bring in revenue of $1.85b, but reported actual revenue of $2.23b, beating expectations by about 20%. Not only did revenue outperform, but trading volume and total user growth were also impressive. These numbers are a clear indicator of a macro bull market, considering the high demand during widespread fear in the markets.
They hinted that Q3 will see a bit of a slow down, which is expected based on the price action and volumes seen this summer.
Infrastructure Bill Passes In The Senate
We already knew that this was coming and, as expected, the crypto market shrugged off the news. The bill will proceed to the house and the voting process will start all over again. Even senator Shelby admitted that he supported the cryptocurrency amendment, but voted against it because he didn't get his way on military spending. Hopefully, the house recognizes his mistake and makes the right decision. I believe they will.
More ETFs Await SEC Approval
VanEck, the earliest contender in the Bitcoin ETF race, has submitted a new proposal. The firm is hoping to please the SEC by resubmitting with minor adjustments to include the futures market. In his recent speech, Gensler hinted at a likely approval of a "Bitcoin futures" ETF, so firms are retooling their offerings. Eventually an ETF proposal will stick and many more will follow, each one becoming slightly more innovative than the next.
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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.