The Wolf Den #321 - 24/7/365
Bitcoin Thoughts And Analysis
WEEKLY CHART
Demand continues to show up, as bulls step in on every dip. As you can see price, is almost back at the 23.6% fib, a key resistance around $50,500. This are is resistance on multiple time frames, so we will need to see a real push here to power through it. Above that there is basically no resistance until the supply zone from 56K to 59K.
DAILY CHART
The Bollinger Bands continue to tighten, which means that volatility is inevitable. Price bounced nicely off of the mid range of the bands as support and is not retested the top of the bands again as resistance. More resistance! It will take a major push on significant volume to push through this area.
Bitcoin is once again pushing into a key area of resistance and supply. If you are trading this, you want to see it above and retesting as support. The bullish ideas would be the path drawn - pushing through supply zones, retesting as support and heading up. Right now we have potential bearish divergence again on the daily (not shown), so we need real volume and a bigger move to the upside to invalidate it again.
4-HOUR CHART
Boom. Price broke out of the symmetrical triangle on increased volume. You can see it has already almost revisited the triangle highs around $50,500. If you view this is a bull pennant, the targets are much higher, but for now this is also at resistance at the top of the pennant.
Bottom line, Bitcoin looks GREAT, but needs significant volume and a major push to get through this area and target the higher zones we are watching.
Altcoin Charts
Based on your requests, it is clear that most of you are trading altcoins on the USDT pairs and not the BTC pairs. These generally look very good, because Bitcoin is rising. Just keep in mind that if Bitcoin explodes in either direction, the alt/BTC pairs will likely suffer even as the USDT pairs rise. Look at Bitcoin Dominance below:
BITCOIN DOMINANCE
Bitcoin Dominance is not a tradable asset, so charting it is a bit of a meme. That said, you can see that it is sitting in an area where it has consistently bottomed. If Bitcoin makes a big move, dominance will likely rise, hurting altcoins, at least on their Bitcoin pairs. I am not sure how much deeper dominance can go, as 35.41 was the all time low. Returning there would still give us plenty of action, it's just important to keep in mind that we are near an area of support and that dominance is not going to 0.
DOGE/USDT
I have shared this chart a few times, showing the descending wedge, which is a bullish pattern with a target near the highs of the pattern - 35 cents in this case. Price has broken out of the wedge, so there should be a nice 18-20% gain available to those who catch it.
Here is the wider view, zoomed out on the daily. Key levels are marked, so you can use them as targets and resistance and support if this continues heading up. This looks like major bullish consolidation after bottoming and reversing.
TLM/USDT
This is just a reminder that TLM has broken out of the bull flag and is currently retesting it as support. Targets are shown based on the 2 flagpoles.
VET/USDT
I set an alarm on this coin on the livestream last week and it went off over night. As you can see, price has broken through the descending black resistance, after consolidating heavily below it. Consolidation below resistance usually leads to expansion through, and we can see this with increased volume on the move. This should ultimately target the highs around 28 cents. I would consider the setup failed if price starts trading back below the descending resistance.
There is minimal resistance from here to the recent highs. .152 is close and could be a challenge. Above that it's somewhat clear sailing.
Chart Requests
Tons of potentially good setups in this video, so make sure to watch it today!
RSI And Divergences 101
Many of you have likely read this piece on my blog and in the newsletter, but I feel it is important to share it periodically. This is one of the core techniques that I use to identify trades, and I discuss it all of the time. Give this a read, then read it again.
Dogecoin 2.0 Is Not Related To Doge!
The Dogecoin Foundation has released an official comment on the rise in popularity of a new coin called Dogecoin 2.0. The statement was explicitly clear - Dogecoin has no affiliation with the 2.0 copycat. Iterations of coins tend to gain a lot of attention and even sometimes experience explosive price action, but managing them comes with high risk. The coin name is misleading and does not have the solid foundation that Doge has built over the past decade.
Be careful investing in any derivative or iteration of a project. We saw Shiba and the rest of the dog meme coin knockoffs take a HUGE hit on the last correction. If you are going to own something, you should be considering the real thing, even if that coin is a meme itself. Here is what the Dogecoin Foundation had to say: “to protect the Dogecoin community from being misled and to protect the Dogecoin name from possible misuse we have asked our brand protection lawyers to contact the developers of the ‘Dogecoin 2.0’ product.”
On a side note about Doge, Vitalik said this on Twitter and it is really fascinating:
"Personally, I hope that doge can switch to PoS soon, perhaps using Ethereum code. I also hope they don't cancel the 5b/year annual PoW issuance, instead they put it in some kind of DAO that funds global public goods. Would fit well with dogecoin's non-greedy wholesome ethos."
Vitalik is now an integral part of Doge. He is a part of the foundation and seems to show genuine interest in the asset. This will be a fun one to watch play out.
A Perspective On NFTs
I will be the first to admit that NFTs are conceptually difficult to grasp. I had a feeling that they were going to be huge a long time ago. Fans of the podcast know this, because I have discussed it endlessly with past guests. To be honest, I never did much about it, beyond buying a few fine art NFTs that I love. I never expected the "digital jpeg" side to be particularly valuable.
This ties back into having a strategy as an investor and sticking with it - I only invest in things that I fully understand and can accurately value. That said, NFTs have made it big whether we like it or not, and it’s time to recognize that fact.
NFTs in their current iteration are a new medium of art. If you think of them as only a digital penguin, punk, or rock, you are failing to see the forest through the trees. Think back to the first cave paintings, Greek sculptures, pottery work, or self-portraits. These originals may not be the most aesthetically pleasing pieces of art to look at, but they tell a story of our humanity and creativity that is priceless. NFTs are the next step in the evolution of art. They are a new mode, medium, and style that carry with them a story of decentralization, 21st-century technology, meme culture, blockchain and so much more.
Not every day does humanity stumble upon a new expression of art. And with that comes the blessing we have to participate and watch it unfold. So of course the original NFTs are going to have value. Don’t take this as a reason to go slam the buy button, because most of these pieces of "art" will still go to 0. That is the case with ALL art. Take it as a reason to appreciate and enjoy the opportunity.
Franklin Templeton Eyes Bitcoin And Ethereum
Franklin Templeton is a 1.5 trillion dollar asset manager and is hiring traders and researchers to focus on digital asset management. This is yet another huge institution entering the space. The big money is coming - get ready.
The Wolf Of All Streets Podcast Ft. Raoul Pal
In this whirlwind episode Raoul Pal, founder of Real Vision, asserted that crypto is a once-in-a-lifetime investment opportunity. A scarce set of assets combined with previously unseen network effects have put the ingredients in place to change the world for the better. Furthermore, Raoul is still “irresponsibly long” on his crypto positions, and predicts we are still at the beginning of a generational opportunity.
Raoul Pal and I discussed:
What is Real Vision Crypto?
Is Dogecoin a real force?
Being 100% invested in crypto
Ethereum as the greatest trade
The fastest period of change
Is regulation on the way?
Does one chain win?
Increasing strength in price and news
Is Every institution looking at Bitcoin?
How many coins will survive?
Generational investments
Will traditional banking collapse?
How does the average person win?
Can DeFi steal market share?
Punks, penguins, rocks, and CBDCs
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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.