The Wolf Den #431 - KPMG Buys Bitcoin And Ethereum
Bitcoin Thoughts And Analysis
WEEKLY CHART
Exciting news... I added another level on the weekly chart. Ok, not that exciting, but also not something that happens often. $45,469 is in blue, because I am not sure yet how significant it is. As you can see, this level was the key level of support for almost 3 weeks before the continued correction and it also lines up well with a key level on lower time frames.
More importantly, it was the exact top of today's move. We will see if that remains the case at the weekly close in 5 days or not.
BTC pushed all of the way through this supply/resistance before dropping. While this looks like a slight sweep of the highs above that range, it appears to be more of a situation where bulls are clearing the runway above for more movement after consolidation.
DAILY CHART
The are the daily levels that I have been sharing on the Bitstamp chart, and Bitcoin is respecting them to the dollar. $45,478 was the dead top of this move, after the last push up was stopped temporarily at 42K.
This rejection on the first attempt is expected, and was a clear short opportunity for scalpers. Right now the daily candle looks like an ugly shooting star, but we have more than half of the day left. No need to worry. It would also require confirmation tomorrow.
Regardless, when key resistance is hit, it's usually time to start looking at support levels to buy the dip, assuming you believe that the asset did not just top for good.
Remember, we had a weekly candle that broke 39.6K and 42K resistance, a break of the descending blue resistance and retest as support and continuation. This is bullish price action for now.
The levels just mentioned would be nice retests for support - I can imagine people will be panicking if we head back down below 40K to test 39.6K. That would be fun.
Price is back over it's skis, hanging out completely above the top Bollinger Band. We should see some mean reversion and price dropping a bit to consolidate back in the bands.
4-HOUR CHART
We are finally seeing some overbought bearish divergence on the last push, which is confirming as we speak. No fear, it's very likely that it will be followed immediately or soon after by hidden bullish divergence. This is worth watching, because an overbought bear div is a clear topping signal in a vacuum. We would need a significant drop to invalidate the potential hidden bullish div for now.
Reminder that there was bullish divergence with oversold RSI at the dead bottom - as there almost always is.
Bottom line - things looks bullish for a bottom being in and a macro reversal. It also look likely that we will see some retracement and consolidation after this strong push up, meaning a likely opportunity to buy the dips when people get scared again.
I can be COMPLETELY wrong.
Paper Trade Daily
There is no reason for a beginning trader to use real money when there are endless resources and platforms for paper trading, including TradingView. Anyone interested in becoming a professional trader should first develop a system based on a simple set of guidelines for their entries, exits, and risk management. This should not be done with actual money. Paper trade until you are ready to lose your mind, then paper trade some more. Even after you are ready to begin trading with real money and have seen some success, do your best to continue paper trading on the side to test new strategies. There will become a point where you have no desire to continue paper trading, so push the envelope for as long as you can. Eventually, you will hit the point of no return, and hopefully, by then the training wheels will have paid off.
It is true - there is no replacement for emotion in trading, which only comes with having real money on the line. But before instilling that emotion, make sure that you have your system in place and refined - then it’s up to you to follow it in the heat of the moment.
This is no different than an NBA player staying late after practice to shoot 500 more free throws. It’s easy in practice but gives you the muscle memory to make the shot when it counts.
We Are Approaching 2M Ethereum Burned
track ETH become ultra sound money
Almost 2M Ethereum have been burned - 1.78M to be exact. Right now, about 6.66 Ethereum are burned per minute, bringing the total to $5.6B worth since EIP-1559. Perhaps the most incredible part is that this is the result of only 185 days of burning, just a little more than half a year.
Ethereum’s circulating supply is 119M, meaning we have burned almost 2% of the total. What is responsible for most of the burning? OpenSea, Eth Transfers, Uniswap V2, and Tether, in that order. For now, it’s all about NFTs and DeFi, but we will inevitably see more use cases and companies built on Ethereum. Imagine how much supply will be burned then. The sky's the limit.
Lightning Goes Mainstream
“JUST IN – All Cash App users can now send #bitcoin on Lightning ⚡️”
Through Cash App, instant and free Bitcoin transfers are now possible, thanks to the Lightning Network. Although it's a huge success for Bitcoin's second-layer protocol, the app can only send transactions for now, not receive them. The integration is still a huge breakthrough, considering the endless doubt Bitcoin developers have faced while trying to make Lightning happen. This is another major step towards mainstream adoption and use.
The Wolf Of All Streets Podcast Ft. Dave Weisberger
Dave Weisberger made his second appearance on the podcast to share his thoughts on the current irrationality in markets. According to Dave, stocks are behaving more like a speculative casino, which is why he thinks legacy markets are fundamentally broken. This exciting episode covers the Fed’s FUD, why Bitcoin will always be first, crypto correlation, value stocks, looming regulation and so much more. If you are invested in the market in any capacity, you need to watch this incredible breakdown.
In this episode with Dave, we discussed:
Peak Irrationality
Big Tech Vs Value Stocks
Fidelity’s “Bitcoin First” Report
There Are Not Enough Bitcoin
Is Bitcoin Correlated To Markets?
Regulation Is Looming
The Fed’s FUD
When Crypto Analysis Works
The Crypto Investment Thesis
Early Investors Are Trail Blazers
This episode is sponsored by: AMBER GROUP and HORIZEN.
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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.