The Wolf Den #387 - Congress Faces Off Against Crypto Titans
Bitcoin Thoughts And Analysis
WEEKLY CHART
Nothing has changed and it is only Wednesday. Just a reminder that we still have bullish market structure (blue arrows) with higher lows and higher highs. Price is also still holding the 50 MA, around $47,300.
I occasionally check MACD for confluence of ideas and it looks awful on the weekly chart. This is just one indicator and can often be wrong. That said, we have clear bearish divergence (over a very long period, so not as relevant) between price and the oscillator. Further, we have the first bear cross of the MAs since the crash in April, and also can see the histogram in the middle of the indicator moving negative (the little vertical lines are now in the bottom half). Not great.
This bearish divergence also exists on RSI on the weekly and monthly Bitcoin charts, but on these large time frames they are VERY hard to trade.
DAILY CHART
Yesterday's candle was a shooting star, which would look more bearish with a red candle today, which we currently have. Not much to like here besides a bounce after an impulsive move down. Predictably, people were turning bullish yesterday under resistance, which I told you was likely to happen. And we didn't even make it to 53K yet!
4-HOUR CHART
Bitcoin was rejected at the golden pocket after the bounce from the corrective lows. The golden pocket is the area between the 61.8% Fibonacci level and 65%. All assets love this area, but Bitcoin in particularly has a tendency to end it's moves in that zone. As you can see, price, is now back below the 50% line.
A bear flag or pennant usually does not retrace back this far, but you can see that this is technically bearish consolidation, with price floating up on decreasing volume.
Bullish divergence could be back in play if price drops below $46,588 (not shown on line chart).
BOTTOM LINE: The market looks shaky with no clear direction. I still expect it to range for a while.
Altcoins
Altcoin charts looks shaky across the board, with little clarity or a consistent direction. We saw some nice moves yesterday and many are still holding macro support (for now), but the bounces looked like a natural reaction after a major drop and not a true reversal. Bitcoin still looks weak to me, and any negative movement will likely hurt alts disproportionately.
I will not personally be looking to add anything at the moment, because my bags are full and I have enough exposure
If you are an investor and dollar cost averaging into projects or buying dips, you should maintain your strategy.
If you are trading...
Be patient and wait for the market to settle and offer a more clear direction.
Forcing trades into a weak and choppy market is bad for your bank roll and mental health.
Fidelity Partners With Nexo
Mergers, acquisitions, and partnerships are a tell-tale sign of a healthy market with growing institutional and mainstream interest. While Bitcoin investors are experiencing extreme fear and people are panicking, $14B investment giant Fidelity is quietly establishing itself as a serious long-term player in the crypto arena. They have been in the space for years, but perhaps their recent partnership with top-tier crypto platform Nexo is their biggest move of all. Fidelity’s 83.4 M accounts and Nexo’s 2.5 M customers should bring a lot of new and improved exposure to crypto for clients in need of a wide variety of services.
From the Business Wire report: “this latest development gives institutional investors who currently custody their digital assets with Fidelity Digital Assets access to Nexo’s products and state-of-the-art crypto prime brokerage, all under one roof. As a result, institutional clients will enjoy tri-party structures that combine Nexo’s unparalleled lending solutions with Fidelity Digital Assets’ market-leading asset protection.”
This is huge.
Craig Wright "Wins Lawsuit"
Craig Wright may have won a technical "victory" in the courtroom, but he has done nothing to convince anyone that he is Satoshi Nakomoto. The verdict of the ongoing dispute found that Wright is entitled to $56B worth of Bitcoin, assuming that he has access, and assuming that no other person besides the Kleiman family makes a claim. Furthermore, the jury did find Wright guilty of one of the counts, for which he owes $100M. There is really no telling what will come next, but for the time being, we at least get to watch him attempt to pay $100M in restitution for stealing intellectual property. For now, I think we can rest assured Craig Wright will continue to... not be Satoshi.
Crypto For Christmas
1 in 10 Americans intend to give crypto as a holiday gift, with a heavy focus on Bitcoin, Ethereum and Doge (of course!). That is 25 MILLION people that will be giving away crypto, as there are 250M adults in the country.
Wow.
My Recommended Platforms And Tools
This is where I trade with leverage and can also trade spot with no fees.
This is where I invest, commission-free. They now let you earn interest on your Bitcoin held in Voyager, so you can compound while trading. Not only that, you’ll get $25 in free BTC when you download & fund.
Rewards Code: WOLF25
Mining for everyone! You can buy an ASIC and have it set up at a destination of your choice by them, and you only pay the electricity cost. Absolutely awesome.
I use RoundlyX to buy small amounts of Bitcoin every single day. They automatically round up my credit card purchases (with 10x multiplier) and invest them in crypto. Absolutely brilliant. Passively invest money you don’t need without a thought. Further, they have integrated with Voyager (see above) to offer commission-free purchases.
Rewards Code: WOLF
Concierge Phone Service for Americans that protects your from SIM Swaps and other phone related hacks. I cannot stress enough how amazing this service is.
Subscribe to my YouTube channel for free daily content.
Follow me on Twitter at @scottmelker. This is where I am constantly updating my trades and sharing ideas.
On-chain and fundamental analysis, research, predictions and indicators, all in one place. Highly recommend.
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.