The Wolf Den #449 - Take A Rest
Bitcoin Thoughts And Analysis
I am still long Bitcoin from $35,000. In fact, I added a bit to the position yesterday at $41,890 and again this morning at $41,600. As you know from my analysis yesterday, I was anticipating the drop. My cost basis is still below $37,000, so I have a lot of room to continue to add for now. I have more bids down to $39,600, lined up with the 50 MA on the daily and other key levels. If we lose $39,600 convincingly, I will have some decisions to make. For now, my stop losses are well above my entry.
Reminder: I am ALWAYS LONG SPOT BITCOIN. I am a long term investor, dollar cost averaging, buying on dips and not selling. If I share a Bitcoin trade, it is with my trading portfolio and minimal risk. I keep investing and trading portfolios separate.
WEEKLY CHART
By now, you should all be aware of the key areas on the Bitcoin chart - $45,500, $42,000, $39,600. These are the only levels that matter for the moment - we can discuss lower and higher support and resistance when they become relevant. We want to see the weekly close above 42K, since it is currently trading below. We are still yet to convincingly flip that level back to support on a weekly candle.
DAILY CHART
I added more to my trade because of the retest of $42,000 (which is still in progress on the daily, since the candle has not closed) and the retest of the descending blue support. I would have liked to see this wick test the 50 MA as well, because I think that is still likely. We discussed all of this yesterday, and got the dip I was looking for. The 50MA does not need to be retested here, and it could head up and retest much higher. But I think it is still very much in play.
For now, I am still generally bullish, nothing has happened that would change that for me.
I have not updated the Bollinger Bands in a while. As you can see, price has once again visited the top of the bands and almost retested the centerline as support. Generally, visits to the top and bottom have been easy trades for scalpers, with the bands traveling sideways.
4-HOUR CHART
As I mentioned yesterday, the price action was not looking bullish. It was a rounded top, not a flag or pennant that you look for for continuation to the upside.
I have highlighted a few zones of interest, which can be used (hopefully) for shorter term trades. Price is currently in a major area of support.
Altcoin Charts
Patience. I have received some emails from frustrated subscribers, wanting altcoin charts and trades. One of the most important skills a trader can develop is the ability to sit on their hands and opt out of a suboptimal market. Altcoins, in general, are struggling. There may be a few occasional diamonds in the rough at the moment, but they are hard to find and odds are against any good looking setup playing out. I will share aggressively when I feel the market looks better.
Ukraine Pulls The Rug
About a week ago, Ukraine made global headlines for issuing Bitcoin, Ethereum, and USDT addresses for donations. They later added a DOT address as well. As an unprecedented amount of money poured in from around the world, an even more remarkable thing happened - an airdrop was announced for all donators. This led to a rush of additional funds into the country's wallets. Then the rug was pulled. The government of Ukraine changed their minds and decided to do an NFT drop instead, sparking outrage and memes across the cryptosphere. It seems more likely every day that we are living in a simulation and not the real world.
The Merge Is Nearing
All the latests news on Crypto, Blockchain, Bitcoin, Ethereum, Tokens, ICOs, Fintech, and more.
After many years of conceptualizing, testing, bounty hunting, and upgrading, the merge is now very close. Ethereum 2.0 is still quietly going as planned. The public testnet should go live in a week or two and, if it runs smoothly, the merge should happen about 3 months later. This could happen as early as summer, but we all know it will probably face some delays along the way. I think Q3/Q4 is a reasonable goal to expect the merge to happen.
Swiss City Accepts Bitcoin
City -> State -> Country -> World. That's the motto.
Most of crypto Twitter had probably never heard of the city of Lugano until yesterday, but now it's being widely celebrated. The mayor of the Swiss city announced that Bitcoin, Tether, and Lugano's own LVGA token will be accepted as legal tender. Beyond just the city accepting cryptocurrencies, over 200 businesses have also installed the infrastructure to accept payments. I am expecting many similar stories in the near future.
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.
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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.