The Wolf Den #435 - Traders Vs. Analysts
Bitcoin Thoughts And Analysis
WEEKLY CHART
Hey Siri, show me the ugliest weekly candle possible.
As you can see, Bitcoin printed almost a perfect gravestone doji on the weekly. When placed in an uptrend, this is considered one of the most potentially bearish candles possible. Of course, it requires confirmation next week. Some would identify this as a shooting star, because there is a very slight wick down below the body.
Either way, both candles indicate a likely top. Bulls attempted to advance price and failed, as shown by the large wick up. Price closed almost exactly where it opened the week before.
Once again, this REQUIRES CONFIRMATION. These candles mean nothing unless we see more downside this week. We just had two beautiful weekly candles in a row, this could just be a little pause.
42K and 39.6K remain the key support at the moment. 45.46K is the key resistance, which I added last week.
DAILY CHART
The daily chart shows roughly the same levels. We already broke the descending blue resistance, which "should" be a signal that the major down trend is over. The last 3 daily candles (today not closed yet) are tiny dojis trading in a tight range. Impossible to trade.
For now, all we can do is watch these levels.
4-HOUR CHART
Bitcoin printed confirmed bullish divergence with RSI. This is usually a decent bottom signal, but much stronger when it's on other time frames as well and oversold. Still, if you are looking for hopium on a shorter time frame this is it. Would be strange to get no real movement up off of this indicator.
Altcoin Charts
The market continues to look rough and altcoins are suffering. In my quick glance across charts, nothing is jumping out. Even if one or two coins look even decent, it's hard to want to endorse any moves while the rest of the market looks shaky. I will keep an eye out for setups, but right now I am watching and waiting.
BITCOIN DOMINANCE
I always mention first that charting Bitcoin Dominance is a bit of a meme - there are no orders, supply and demand. It's just purely lines moving. That said, it can at least give us a vague idea of what is happening. As you can see, it bounced from a key area of support a few weeks ago where "alt season" have traditionally come to an end. It is continuing to rise with little resistance in sight for the moment, which is generally an iffy time to be actively in altcoins.
Simplifying Crypto
Learning crypto is like learning a new language. This Twitter account went from A-Z and covered the most important words you need to know for successful day-to-day crypto communication and knowledge. There are a lot of words in crypto you don't need to bother learning, but I would make the case that each of these words mentioned are worth your time. Do you know all of them?
24 Million For a JPEG
1 of 9 existing "Alien" crypto punks just sold for a whopping 8000 ETH, or 23.7 million dollars. The buyer was Chain CEO Deepak Thapliyal, who used leverage through CompoundFinance to make the purchase, effectively going long ETH and continue holding his assets with selling and triggering a taxable transaction.
Crazy.
Coinbase Hack Averted
It’s common to associate the word “hacker” with bad intentions, but that’s not always the case. Over the weekend, a well-known white-hat hacker by the name of “Tree of Alpha” reached out to Coinbase to warn about a vulnerability in their order books. By the power of our vocal community, Tree of Alpha was quickly connected to Brian Armstrong and the Coinbase dev team to share his findings and save the day. According to the white hat hacker, the bug carried “serious company and market damage” and was described as “potentially market nuking.” It goes to show that just because bad intentions pay, not everyone out there with power wants us to fail.
The Crypto Bowl
If there was any doubt that crypto has gone fully mainstream, it should be put to rest after last night's exciting Super Bowl. 4 major exchanges chose to run 30 and 60 second ads in front of the 110M viewers, each taking a unique approach to enticing new users to their platforms. I have linked all of them on YouTube below, enjoy!
My Recommended Platforms And Tools
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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.