The Wolf Den #414 - Cash Is King Or Cash Is Trash?
Bitcoin Thoughts And Analysis
I am on a laptop today, so my charts will appear a bit smaller.
Bitcoin is once again volatile and driving traders and investors crazy. After managing a move to roughly $44,500, Bitcoin dropped and has seen steady selling pressure since. This resulted in one of our most beloved patterns, the "Bart." That said, we tend to love it more when it's upside down.
While the pattern is a joke, it's worth looking at, as it happens often in crypto markets. There is a reason. That reason is generally overleveraged retail traders that are fodder for whales. We see a markup into the pattern, getting retail to FOMO, believing that the big move is coming. Then distribution, then markdown. This is a version of this simple schematic, made famous by Wyckoff.
This is one of the biggest signs that the Bitcoin market is still nascent and easily moved by players with sizable stacks. Whales games.
WEEKLY CHART
Back at 42K. Did we expect anything different? This is the key level on the weekly chart that bulls truly want to defend going into the weekend and the impending close. We currently have a perfect doji, with a wick up and down and the open and close at the exact same price, but this candle has not closed. I would really like to see bulls show some initiative and hold this level. The further up we close the better. This candle looked far more promising a day ago.
DAILY CHART
Bitcoin did not manage to cross bullish on MACD, with the two MAs still running next to on another. The bullish divergences are still there, as is the descending line that we need to see broken to give confidence in a renewed move up.
4-HOUR CHART
These are the key levels on the Bitcoin low time frame chart. As you can see, price just once again swept the range lows around 42K. If you believe we are still going up, this is a pretty standard place to attempt a long.
HOURLY CHART
What would drive traders even more insane? A new, lower time frame range between the recent lows and highs. We are currently at the EQ of that range.
India Approves Crypto ETF
India intends to kickstart its own Bitcoin and ETH ETF in full compliance with the law
India volatile affair with crypto has flipped favorable again. Kling Trading India and Cosmea Financial Holdings received approval from India’s government to launch a Bitcoin and Ethereum based futures ETF, along with “metaverse US-listed large-cap discount certificates.” The initial goal is for the funds to generate $1B AUM in the first two years. This should be easily achievable goal considering the ETFs will have a first-mover advantage in the second most populated country in the world, with a time frame of 2 years to achieve. Furthermore, the goal isn’t just for the Bitcoin product. It’s a total amongst all of the ETFs combined. Set the bar low and celebrate the success.
Fed Crypto Report Coming Soon
A major government report on digital currencies that is long overdue is slated to be released in the coming weeks. From Fed Chairman Powell - “it’s more going to be an exercise in asking questions and seeking input from the public rather than taking a lot of positions on various issues, although we do take some positions.”
Sounds vague and non committal, in line with everything else the US Government distributes about cryptocurrencies.
Is Big News Coming?
The North American Bitcoin Conference begins next Monday. This is one of the largest gatherings of the year, and usually a place where a big announcement is made. I was initially slated to speak but won’t be attending. Either way, I will be following along closely.
Untold Stories
My friend Charlie Shrem invited me to be a guest on his amazing podcast, Untold Stories. We covered a ton of a ground, a really interesting conversation. You can listen above on apple, but can also find it anywhere you enjoy your podcasts.
My Recommended Platforms And Tools
This is where I trade with leverage and can also trade spot with no fees.
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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.