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In This Issue:
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A Letter To Bulls
Sign Up For THE DAILY CLOSE!
Bitcoin Thoughts And Analysis
Legacy Markets
3AC Ventures…
Powell Addresses Crypto
Ledger Releases White Paper As Promised
ETF Orgy
ETF Mania! Crypto Skyrockets | Will Bitcoin Break $30K?
A Letter To Bulls
Dear Crypto Enthusiasts,
Take a moment and applaud yourselves – you've earned it. The previous news cycle was no walk in the park; the market attempted to rattle you, but your steadfastness prevailed. However, before we get caught up in euphoria, let's stay grounded – bull markets bring their own challenges - including deciding whether we are in a bull market or not!
The survival tactics required in a bear market are not the same as those needed to thrive in a bull market. Prolonged market extremes can condition us into a single mode, causing us to forget how to adapt when the price direction reverses. Losing money in a bear market is tough, but surrendering profits in a bull market can be even more agonizing.
I urge you to understand the weight of this message. I want you to succeed and truly believe you can. To help, I've compiled a few pointers to prepare your mindset for the upcoming trends, whether they be immediate or after the halving next year. Do NOT fall into the trap of thinking it's 'up only' - it might feel like it for a while, but it's not sustainable. The time to get ready for a bull market is now, and your portfolio's health depends on it.
Winning Is Not a Given
During a crypto bull market, not all assets will flourish. The majority of what exists now may not endure from one cycle to the next. I've reiterated this countless times - there's no better time to let go of underperformers. If you're banking on last cycle's altcoins topping the charts in this cycle, brace for disappointment. An altcoin getting a sympathy boost from Bitcoin's rise is NOT victory; it's a sign to allocate your resources elsewhere. As much as we'd all like to win, markets don't operate that way - you still need to earn your slice of success.
Avoid Envy
Bull markets will always present greener pastures. The key is to concentrate on nurturing your own portfolio. Below, I've outlined the common cycle of crypto envy – it's a recurring pattern of mental strain and portfolio decline that we've all experienced. Don't get caught in it.
Bitcoin holders envy early investors.
ETH holders envy Bitcoin's superior performance.
Altcoin holders envy GBTC's outperformance.
GBTC holders regret not buying real Bitcoin.
Ironically, as soon as Bitcoin cools down, these roles reverse, just like in a game of musical chairs:
Bitcoin holders envy ETH investors.
ETH investors envy altcoin holders.
Altcoin holders envy GBTC and memecoin investors.
Memecoin investors envy Bitcoin holders.
Envy is the market's way of coaxing you into chasing the wrong strategies and narratives. Resist it. If you change your perspective, you'll see that after Bitcoin settles, Ethereum and then altcoins will have their day. Diligent investing can yield multiple winners at different times.
Don't Cash Out Minor Gains
Don't fool yourself into trading through a bull market! Unless you're certain you can outpace a bull run, avoid this folly. A profitable trade doesn't always equate to time well spent. Your trading activity could erode your own profits, effectively cannibalizing your portfolio. Most investors are better off holding steady, weathering the highs and lows. I've written in depth about this on my blog, 'Everyone Is A Trading Genius In A Bull Market'.
Detach Emotionally
Yes, you and your investments weathered hard times together, but it's time to outgrow your infatuation. Unless your strategy was to never sell, consider taking profits at some point instead of enduring another multi-year bear cycle. The moment to realize profits for long-term investors might still be far off, but it's time to start distancing emotionally from your investments. I adore Bitcoin and Ethereum, but when the time comes, I won't hesitate to realize some gains - feel free to criticize me!
Stay Within Your Narrative
Hopping between narratives is a surefire way to miss trends. Investors who switched from crypto to AI probably arrived late, and will be late again when they scramble back to crypto. If you've done your research, hold your ground and resist chasing every shiny object. Patience is vital in both bull and bear markets, and the same applies to discipline. If you followed a strict strategy during the bear market, adhere to one during the bull market too – making drastic changes is unnecessary.
Crypto is still evolving. There will be many bull markets, so breathe easy knowing there will be more ups and downs. That said, it's time to strategize for a bull market. If you're still in bear hibernation mode, you're going to fall behind or already have – wake up and start making choices that optimize your growth in bullish conditions.
This message may be more bullish than my usual ones, but that's because I'm generally bullish. While I can't predict tomorrow, next week, or next year, my inclination leans more towards growth – it's an exciting time to own crypto.
Sincerely,
Wolf
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Bitcoin Thoughts And Analysis
This candle is effectively erasing 10 weeks of consolidation and downtrend. In just a matter of days. It is important to note that the week isn't closed yet, but this is seemingly a very significant move to the upside. You can also see that the current candle is confirming the reversal predicted by last week’s bullish hammer into $25,212 support. The 200 MA is now far below, as is $28,600 support, the key level to hold now.
Boom.
Yesterday’s candle was larger than the day before, with almost double the volume! When candle spread increases and volume increases after an already sizable move, you know that you have a true trend on your hands.
RSI is just hitting overbought, so we want to be careful not to form bearish divergence. But Bitcoin has a tendency to push VERY overbought in a real bull trend, so I am not concerned. Lower time frames are massively overbought already, with the 4-hour near 90 RSI. I would expect some consolidation soon just to let things cool off. This is a buy the dip situation, generally.
It is worth zooming out to revisit what has happened on the daily. You can see that $31,000 is now the key resistance, that is the yearly high and the top of the recent move that ended months ago.
What I wanted to highlight was the breakout of the descending black line which was your hint that the bullish trend was beginning. This was perfectly retested as support (blue arrow), just like $25,212 was before this move up.
This is further evidence that the “safest” entries for conservative traders is always a retest of a key line or level as support.
Legacy Markets
Global stocks and U.S. equity futures experienced significant downturns due to the growing apprehension over policy tightening in various regions from the U.S. to Europe. This market correction was largely influenced by Federal Reserve Chair Jerome Powell's hawkish warning about prospective rate hikes. Central banks around the world are battling persistent inflation, and despite a recent pause in the Fed rates, the anticipation of further rate increases has led to renewed fears of an economic slowdown. Market analysis suggests higher rates over an extended period could significantly raise recession risks, an outcome that isn't currently reflected in risk assets.
In the UK, the Bank of England is under pressure to address inflation, which has consistently exceeded expectations, escalating to 8.7%. Current market forecasts imply an end-of-year benchmark of 6%, which would mark the highest rate since the century's turn. Similarly, Norway's central bank has increased its key deposit rate to 3.75%, with expectations of further hikes. Amid these changes, there are escalating concerns that central banks may overlook potential economic slowdowns to prioritize fighting inflation, even at the risk of triggering a recession. Meanwhile, the Swiss National Bank, facing lower inflation rates, has taken a milder approach, implementing a modest interest rate hike of a quarter-point to 1.75%.
Key events this week:
Eurozone consumer confidence, Thursday
Rate decisions in UK, Switzerland, Indonesia, Norway, Mexico, Philippines, Turkey, Thursday
US Conference Board leading index, initial jobless claims, current account, existing home sales, Thursday
Fed’s Powell delivers testimony before the Senate Banking Committee, Thursday
Cleveland Fed’s Loretta Mester speaks Thursday
Eurozone S&P Global Eurozone Manufacturing PMI, S&P Global Eurozone Services PMI, Friday
Japan CPI, Friday
US S&P Global Manufacturing PMI, Friday
St. Louis Fed President James Bullard speaks, Friday
Some of the main moves in markets:
Stocks
The Stoxx Europe 600 fell 1% as of 10:30 a.m. London time
S&P 500 futures fell 0.2%
Nasdaq 100 futures fell 0.3%
Futures on the Dow Jones Industrial Average fell 0.2%
The MSCI Asia Pacific Index fell 0.2%
The MSCI Emerging Markets Index fell 0.1%
Currencies
The Bloomberg Dollar Spot Index was little changed
The euro rose 0.1% to $1.0998
The Japanese yen was little changed at 141.91 per dollar
The offshore yuan was little changed at 7.1812 per dollar
The British pound was little changed at $1.2776
Cryptocurrencies
Bitcoin rose 0.6% to $30,153.68
Ether rose 1.6% to $1,909.34
Bonds
The yield on 10-year Treasuries advanced three basis points to 3.75%
Germany’s 10-year yield advanced one basis point to 2.44%
Britain’s 10-year yield advanced one basis point to 4.42%
Commodities
Brent crude fell 1.1% to $76.27 a barrel
Spot gold fell 0.2% to $1,928.39 an ounce
3AC Ventures…
Do you recall OPNX, the crypto claims exchange created by Zhu and Davies, which allows creditors to trade their claims on the platform? This same platform has now announced a new partner in their ecosystem named 3AC Ventures. A tweet from Kyle Davies announced, “3AC is dead, long live 3AC Ventures,” followed by, “no leverage, no debt, no fear.”
The bewildering aspect of this news is that these platforms exist, despite seeming almost comical. It's no surprise that outsiders may struggle to take us seriously. I'm astounded that these individuals are even permitted to manage their own finances at this stage, but who am I to judge? If you visit the new site, it simply states, “3AC Ventures is focused on superior risk-adjusted returns without leverage,” which borders on farce.
Powell Addresses Crypto
This segment is straightforward: Powell continues to commit to a 2% target rate. As per the CME Fed Watch Tool, there is a 77% likelihood of a 25 basis point increase at the meeting in late July. Jerome Powell is direct; if he indicates a hike is anticipated, we can take him at his word. I've included some key statements he made during the U.S. House Financial Services Committee meeting, which addressed inflation, stablecoins, and even crypto.
“We do see payment stablecoins as a form of money. In all advanced economies, the ultimate source of credibility in money is the central bank. We believe that it would be appropriate to have quite a robust federal role in stablecoins going forward. Leaving us with a weak role in private money creation at a state level would be a mistake.”
“Crypto appears to have to staying power as an asset class.”
“Inflation pressures continue to run high, and the process of getting inflation back down to two percent has a long way to go. We remain committed to bringing inflation back down to our 2 percent goal and to keeping longer-term inflation expectations well anchored. Nearly all FOMC participants expect that it will be appropriate to raise interest rates somewhat further by the end of the year.”
Ledger Releases White Paper As Promised
A captivating new narrative often has the power to shift the focus of Crypto Twitter, thus relegating self-custody issues to the back burner. Ledger, despite an initial PR stumble regarding the impending Ledger Recover feature, has managed to maintain their trajectory and rehabilitate their image commendably. Although the White Paper caters primarily to a technically-inclined audience, my advice is straightforward: if this development concerns you, avoid using the Ledger Nano X. The company's CTO asserts that the new feature is entirely secure - a claim to be taken with a grain of caution - however, my concern about Ledger as a whole has significantly decreased, witnessing their impressive redemption.
ETF Orgy
Keeping score as we do, there are now six spot ETFs awaiting SEC approval: Blackrock, Fidelity, Invesco, Wisdom Tree, Valkyrie, and Bitwise. Despite variations in their branding, these products are structurally identical, and you may recognize some from previously rejected filings. The market's heightened anticipation over these filings is evident, however, should the SEC decide against their approval, we should be prepared for a substantial market downturn that could be significantly disruptive.
ETF Mania! Crypto Skyrockets | Will Bitcoin Break $30K?
Bitcoin and alts are skyrocketing on the news of BlackRock's ETF application and the launch of EDX Markets, an institutional exchange backed by Fidelity, Citadel, and Charles Schwab. I am joined by Chris Inks and Charlie Burton as we discuss what's going on with markets and what to expect from crypto.
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.