The Wolf Den #429 - Where Is Bitcoin Today?
Bitcoin Thoughts And Analysis
Nothing happening. If I was not writing a newsletter, I would not even be looking for clues on a chart.
WEEKLY CHART
Watching to see if we can actually get 2 grey candles in a row on the weekly, as this has not happened since early November. A break above $39,600 is the first meaningful event.
DAILY CHART
MACD is breaking a local resistance, which often leads to price following. Yes, you can draw patterns on indicators, just like price. I usually use RSI for this.
I am grasping at straws here, to be honest. I would not trade on this, just a good exercise for viewing the chart. As you can see, nothing is happening. We need to see some volume return on a move up.
Go enjoy your weekend.
Altcoin Charts
I am still very hesitant to post altcoin charts. They have largely continued to suffer, with a few rare exceptions. Most see small relief bounces when Bitcoin is stable then take a trip deeper each time Bitcoin moves.
That said, metaverse tokens look decent. I have recently shared SAND and MANA trades that are both playing out nearly perfectly so far, with regard to the entry at support which has been tested. I am sharing those below once again.
EGLD/USDT
I shared this idea a couple of days ago. As you can see, it was rejected perfectly at descending resistance. I love when this happens. Why? Because the idea does not trigger on a break, and when price drops it gives us a chance at a lower entry on the same setup.
Still nothing to do here yet unless it breaks the descending line on increasing volume. We now have 3 perfect touches on descending resistance, confirming that line. Keep an eye on this one.
MANA/USDT
We have a picture perfect retest of both $2.44 and horizontal support in exactly the same spot.
SAND/USDT
This front ran support (so far) by about a penny. You can see the idea starting to play out.
Stop Trading After Three Consecutive Wins Or Losses
Three consecutive wins make you feel like a super trader. You think that you cannot lose. You are invincible. You over-leveraged and over-trade.
Three consecutive losses make you feel like a loser. You don’t want to lose. Your emotions explode. You revenge trade.
If you happen to hit three consecutive wins or losses, it’s time to go back to the drawing board. Keep in mind, the drawing board is not a bad place to be, it is your home base.
If you managed three wins, look at what you are doing right and focus on it. Ask yourself: did I get lucky? Did I beat the market? Could I have done better? Return to battle while you are hot, but remember to breathe. Take your next trade like you are at zero wins and zero losses.
If you suffered 3 losses, locate the mistake and consider ways to improve. Ask yourself: did I get unlucky? Should I have made that trade? Do I need a new strategy? Sometimes, traders fail even when they do everything right and the odds were on their side. That’s okay. Find a fresh mental state and keep pushing. Start again like you are at zero wins and zero losses.
Wormhole Hacked For $320M
120k wETH was wiped off of Wormhole protocol a couple of days ago, making this breach the second largest hack in DeFi history. Wormhole is a popular protocol for moving assets across different chains. Its allows interoperability and it primarily operates around Solana and a few other major blockchains. A weakness was found in the code and a hacker that recognized this bypassed security signatures needed to access funds. The rest was history. Luckily, Wormhole was quick to replenish the stolen funds to avoid collateral damage across other pools, protocols, and market makers that were tied to the missing funds. Essentially, all hell almost broke loose. It goes to show you that nothing in crypto is a guarantee, just being here carries a degree of risk.
Bipartisan Bill Supports Crypto Transactions
U.S. law states that any purchase using crypto is a taxable event, because you are technically selling an investment. This defeats the purpose of using your crypto as a currency. That may change. Four congress members proposed a bipartisan bill exempting taxes on transactions made with digital currency when the "gains" are $200 or less. Although this isn't exactly what is needed to make cryptocurrencies a more usable currency, it is certainly a step in the right direction. With support on both sides of the aisle, it’ll be interesting to see how far this one makes it through the system.
Strips Finance
Most people don't know that interest rate derivatives are BY FAR the majority of the OTC notional derivative market in the "real world." Yes - this is the most popular product on the planet for traders of derivatives in legacy markets. The volume is astounding.
Seeing a decentralized interest rate derivates platform makes a ton of sense, so I will be keeping an eye on this.
My Recommended Platforms And Tools
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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.