Welcome to The Wolf Den! This is where I share the news, my ideas about the market, technical analysis, education and my random musings. The newsletter is released every weekday and is completely FREE. Subscribe!
The Wolf Den is proudly sponsored by OKX, the world’s second largest crypto exchange.
🔥 Sign up for an OKX Trading Account then deposit & trade to unlock mystery box rewards of up to $10,000! Details in the image above.
With OKX, you can:
Trade hundreds of tokens and trading pairs on spot, margin and derivatives markets.
Manage your DeFi portfolio by connecting your Web3 wallet to organize all your decentralized assets in one place.
Create, buy and sell NFTs on their NFT Marketplace.
Discover top decentralized applications, including DeFi and blockchain gaming DApps.
Connect to DeFi with their Web3 wallet via their app or browser extension.
Earn crypto in their mining pools, take out crypto collateralized loans, and discover other ways to grow your crypto with OKX Earn.
Connect to the world-famous TradingView Platform and trade crypto directly with their supercharged charts.
OKX are also partners with Manchester City (3 Consecutive Premier League Titles), McLaren Racing, the Tribeca Film Festival and MORE.
🔥 SIGN UP HERE to show support for the FREE Wolf Den Newsletter!
In This Issue:
Luck Is On Our Side
Crypto Town Hall Starts TODAY On Twitter Spaces
Bitcoin Thoughts And Analysis
Legacy Markets
Boredom = Success
China May Lead The Next Bull Market
Bitcoin Is For Everyone - Even Peter Schiff!?
How These 3 Lawyers Are Defending Crypto And How YOU Can Contribute! | Paul Hastings
Luck Is On Our Side
Have you ever been told that your triumphs are simply a matter of good fortune? That you were just lucky? Quite frustrating, isn't it?
Among the various stereotypes crypto investors regularly encounter, the most prevailing notion is that favorable market outcomes are purely the product of luck. Admittedly, there are more disparaging stereotypes, but this notion remains deeply ingrained, especially among 'investors' who lack a comprehensive understanding of the market.
What if I suggested that we could leverage this misunderstanding to our benefit?
Allow me to elaborate.
Let's confront the opposing viewpoint, acknowledging that indeed, there are individuals who have struck gold in the crypto world. But they're the exception rather than the rule. A lucky break in crypto might resemble the following:
A gamer who randomly used Bitcoin.
Creditors of Mt. Gox who were obliged to maintain their position for ten years.
A Silk Road merchant who adopted Bitcoin due to privacy considerations.
Bitcoin received as a gift years ago.
A family member compelling you to invest in the Ethereum presale, about which you had no knowledge.
This list could extend indefinitely, but one common thread unites these lucky few: the element of serendipity. I don't intend to undermine the intellect of those who did 'make it.' However, luck is an inevitable market dynamic, and occasionally individuals find themselves perfectly positioned at the opportune moment. Such is the ebb and flow of life.
Consider the case of Banksy, the globally renowned street artist whose work can fetch staggering sums from the right collector. Banksy sporadically conceals his work on the streets, selling pieces to unwitting pedestrians. For a mere $30, these unsuspecting buyers acquire artworks potentially worth $30,000 or even $300,000, often chosen merely because they match the decor of their kitchen or their children's room - the embodiment of being in the right place at the right time.
Luck is invariably associated with value, but its incidence is rarer than we might assume.
So why are those unfamiliar with the sector so keen to ascribe our achievements to luck? It boils down to their lack of understanding. Rather than acknowledging their ignorance, it's simpler to assign the role of luck to the unfamiliar. This offers a convenient escape route for those investors who perceive themselves as insiders to rationalize their lack of insight and their failure to capitalize on the opportunities that others seized.
Does the quote, "Everyone buys Bitcoin at the price they deserve," sound familiar? This somewhat supercilious remark likely emanated from Bitcoin enthusiasts seeking to counter the luck narrative. I find this alternative perspective from Cedric Youngleman more compelling: "People like to say you buy Bitcoin at the price you deserve. But I want to say that you buy Bitcoin when you are prepared to admit you were wrong about Bitcoin."
Choose your perspective, but let's return to the topic of luck...
The paradox of the 'luck' debate is that as long as we're seen as incredibly lucky, this could signal that the market retains room for expansion. If the general perception is that sustained success is merely good fortune, it implies a broad failure to comprehend the foundational factors that drive sustained market growth. Thus, ironically, the more people who are convinced of our luck, the more opportunities we have to be 'lucky.'
A shift in this perception could signal that public understanding has evolved, signifying a higher level of comprehension - a positive development for those seeking an alternative to the flawed system, albeit potentially leveling out the prices. However, we're still a distance from this point, as the prevailing view is that we're 'lucky' rather than astute, just ask your crypto-ignorant neighbor or friend.
Lastly, is Warren Buffet deemed lucky? Certainly not, because he has mastered techniques that are widely understood and accepted. The 'luck' discourse in crypto is a prime illustration of alpha hiding in plain sight. We just need to recognize where to find it.
Here's the alpha: as long as proficiency is misidentified as luck, there's likely an abundance of 'luck' remaining. If the public views me as lucky, I'm buying. If they perceive me as skilled, I'm selling.
Crypto Town Hall Starts TODAY On Twitter Spaces
CITIZEN JOURNALISM IS ENTERING CRYPTO. Twitter is the last censorship free platform left. I partnered with the biggest media players in Crypto, Mario Nawfal and Ran Neuner, to shake up the industry with 'Crypto Town Hall' DAILY Spaces!
The LARGEST CRYPTO SHOW starts today at 10:15am EST!
Listen here: https://twitter.com/i/spaces/1vOxwMajQAgGB?s=20
Bitcoin Thoughts And Analysis
The chop continues! No surprises here, right? Bitcoin continues to bounce around in the $27,000s, after a nice weekly close on Sunday. Now we have a potential down candle forming, but still holding above the 200 MA for now.
I see very little insight on any of the time frames at the moment. Lower time frames, like the 4-hour, were majorly overbought on the move up, so now we are seeing simple mean reversion in the chop.
Nothing to do here, in my opinion.
Legacy Markets
European stocks and US equity futures have curtailed losses triggered by China's economic struggles, and bonds saw gains amid indications of easing inflation. The Stoxx Europe 600 index recovered somewhat from a nearly two-month low. Luxury goods makers LVMH and Richemont, who are exposed to the Chinese market, continue to struggle, whereas software and telecommunications stocks, led by Capgemini SE, made progress.
In the US, futures on the S&P 500 and Nasdaq 100 suggested a subdued day for equities following a rally inspired by artificial intelligence that subsequently fizzled out. Meanwhile, treasury yields fell, and the dollar strengthened for the first time in four days.
The euro dropped to a two-month low against the dollar as French inflation eased more than expected. German data also hinted at quicker than anticipated drops in inflation, causing traders to reduce bets on future European Central Bank interest-rate hikes.
Asian equities were hit by a softer reading in China's purchasing managers' index, signaling further economic struggles. Consequently, Hong Kong's Hang Seng Index fell more than 2%, with a bear market looming. China's manufacturing slowdown raises concerns about demand from the world's top metals-consuming economy, affecting copper and iron ore prices.
On the AI front, Nvidia Corp. continued to ride high on the announcement of several AI-related products, driving the Nasdaq 100 up by 0.4%. Cathie Wood, CEO and founder of Ark Investment Management, suggested that AI-related software providers stand to benefit significantly.
Investors remain focused on the debt-limit deal brokered by President Joe Biden and House Speaker Kevin McCarthy, which aims to prevent a US default. There is also ongoing anticipation around potential interest-rate increases following stronger-than-expected economic data and the recent rise of the central bank's benchmark rate.
Key events this week:
US job openings, Wednesday
Federal Reserve’s Beige Book, Wednesday
Fed’s Patrick Harker, Susan Collins and Michelle Bowman speak at events, Wednesday
China Caixin manufacturing PMI, Thursday
Eurozone HCOB Eurozone Manufacturing PMI, CPI, unemployment, Thursday
US construction spending, initial jobless claims, ISM Manufacturing, Thursday
ECB President Christine Lagarde speaks at conference, Thursday
Fed’s Patrick Harker speaks at webinar, Thursday
US unemployment, nonfarm payrolls, Friday
Some of the main moves in markets:
Stocks
The Stoxx Europe 600 fell 0.2% as of 10:26 a.m. London time
S&P 500 futures fell 0.2%
Nasdaq 100 futures fell 0.2%
Futures on the Dow Jones Industrial Average were little changed
The MSCI Asia Pacific Index fell 1.4%
The MSCI Emerging Markets Index fell 0.9%
Currencies
The Bloomberg Dollar Spot Index rose 0.4%
The euro fell 0.6% to $1.0666
The Japanese yen was little changed at 139.90 per dollar
The offshore yuan fell 0.5% to 7.1249 per dollar
The British pound fell 0.5% to $1.2356
Cryptocurrencies
Bitcoin fell 2.4% to $27,112.95
Ether fell 1.8% to $1,869.37
Bonds
The yield on 10-year Treasuries declined four basis points to 3.65%
Germany’s 10-year yield declined nine basis points to 2.25%
Britain’s 10-year yield declined eight basis points to 4.17%
Commodities
Brent crude fell 0.5% to $73.16 a barrel
Spot gold was little changed
Boredom = Success
The video clip highlighted above is trending on Twitter, and I can't stress enough how worthwhile it is. The concept is straightforward: strive to stay engaged even when boredom strikes. The crypto sphere, in particular, poses a challenge for those aiming to play the long game, given our expectation of non-stop excitement. But even crypto can't be thrilling around the clock, which is why it's crucial to view periods of boredom as opportunities for investment, or at least for reassessing our current positions. Here's an excerpt from Cobie's most insightful commentary.
“You need to have the same interest level when everything is really boring. The main way you have to make it is to perpetuate your interest through the boring bit. The boring bit is where the opportunity is, where the moon boys, marketers, and larpers disappear from Twitter and the accounts stop Tweeting. That's the bit where you are supposed to be interested, where you take your next three years of positions. Most people that don't make it, they stick around for the fun bit. Stick around for the boring bit.”
China May Lead The Next Bull Market
Beijing releases white paper for web3 innovation and development
In the wake of Hong Kong's impending decision to grant retail traders access to cryptocurrencies, Beijing has now published a web3 white paper to foster crypto development. The pace of acceptance towards crypto is accelerating rapidly. The document, entitled "Web3 Innovation and Development White Paper (2023),” sets forth Beijing's ambitious strategy to become the next crypto powerhouse. The plan includes an annual investment of at least 100 million yuan (approximately $14 million) dedicated solely to crypto until 2025.
Whether China has genuinely softened its stance on crypto or is simply seizing an opportunity to outstrip the U.S. remains uncertain. However, the evidence increasingly points towards the former, particularly if a comprehensive legislative piece is incorporated into law. Would I favor the U.S. to lead in this direction over China? Undoubtedly, yes. But any form of adoption is beneficial, and hopefully China's advancements will encourage the U.S. to reconsider its position and drive adoption forward. I remain hopeful.
Bitcoin Is For Everyone - Even Peter Schiff!?
We stand on the precipice of substantiating that Bitcoin can, given enough time and appropriate incentives, convert even its staunchest critics. Apart from Peter Schiff, there are only a handful of individuals worldwide who have publicly expressed such intense disdain for Bitcoin, such as Warren Buffet, Charlie Munger, and Nouriel Roubini.
In case you missed it, Peter Schiff plans to sell a 50-series Bitcoin-inspired Ordinal collection, in collaboration with the pseudonymous artist Market Price. Predicting the future value of these Ordinals is impossible, yet the decision marks a historical moment. It appears that Schiff realized the financial rewards of supporting Bitcoin far outweigh the gains of opposing it. We welcome this change of heart.
How These 3 Lawyers Are Defending Crypto And How YOU Can Contribute! | Paul Hastings
Eric Sibbitt, Nick Morgan, and Lisa Rubin are lawyers from Paul Hastings, a globally recognized law firm heavily engaged in the crypto field. We discussed the firm's influence in crypto, its non-profit initiative - Icanlaw.org, and specific cases such as the Coinbase rule petition to the SEC, the Ripple case, LBRY, among others. We also broached the topic of regulation in the US, the possible threat of a corporate exodus from the US, and additional subjects.
In this episode, we discussed:
What is Paul Hastings doing in crypto?
How to advise when there is no precise regulation
How to sue SEC if you don’t have money
LBRY case
Icanlaw.org, non-profit
Strategic ambiguity
The role of the SEC
Crypto exodus
American investors & consumer protection
Security is a bad word in crypto
CFTC vs SEC
Coinbase & rule petitions to SEC
Regulatory arbitrage
How to influence the SEC
Ripple case
Every case is unique
Follow Nick, Lisa, and Eric
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.
Sign up for my other newsletter, THE DAILY CLOSE!
I built The Daily Close to give you the same institutional-grade indicators and signals that I use to trade the market on a daily basis. It's automatically generated and delivered to your inbox at the daily close everyday.
1 Week FREE for all subscribers
17% discount if you subscribe for a year
$25 a month, or $250 a year