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In This Issue:
Traders Vs. Analysts
Trading Alpha
Bitcoin Stays Bullish On The Weekly
Altcoin Charts
Legacy Markets
Stablecoin Adoption Soars In Brazil
Elon Musk Says X Will Replace Banks Next Year
Super Bullish: Raoul Pal Deciphers Bitcoin's Surge & Crypto's Economic Takeover!
Trader Vs. Analysts
Making great calls and being able to actually trade them for profit are vastly different skills.
This may seem like a confusing statement, but it should be very obvious to those of you that trade actively. A great analyst can make million of dollars a years at a hedge fund without ever executing a trade. You can find amazing chartists, fundamental experts and technical analysis wizards on X and beyond. Great analysts are valuable, can have an incredible feel for the market and its direction. They are great advisors.
Most of them STILL lose money as traders.
Like everyone else, they are emotional beings who fail when ego and money are on the line.
Analysis and trading are worlds apart with regards to the skill set and discipline required to be successful. A great trader is far less concerned with their analysis, understanding that they are likely to be wrong. They are far more concerned with maintaining a zen like emotional state while executing their trading plan, cutting losing trades quickly and letting winning trades run. A great trader is defined by one who has a plan and sticks to it, come hell or high water. They plan their losses without day dreaming about potential gains.
Success comes down to the trader, not the strategy that they employ to analyze trades. A good trader can make any analysis method work.
Analyzing an asset is generally about identifying a likely direction and making a general prediction about price action. Trading is a far more in depth pursuit. Not only does a trader have to accurately predict direction, they also have to manage a stop loss (not get stopped out before the trade goes their way), decide when to take profit, how much to risk on the position and when to enter. Traders lose money all of the time, even when their idea is “right” because they have a misplaced stop loss or take profit order, have entered at the wrong time, or have sized their position incorrectly to accommodate for volatility.
Eliminating ego and the inherent human compulsion to be “right” are invaluable skills for a trader. Right and wrong are meaningless in trading - what matters is profit, which comes as a result of strong conviction in a strategy and plan and iron-clad ability to stick to it once the trade is active.
Great analysis is the first step to being a profitable trader, but is barely the tip of the iceberg. It is how you manage the risk based on that analysis that matters. Almost anyone can draw lines on a chart.
Paper trade your butt off, find a system that works, then stick to it without emotion. Gauge your performance over years, not days. Be a robot. Protect your money at all costs.
Trading Alpha
BTC (LOCAL BOTTOM SETUP)
The last time we updated this four-hour chart, the topping signal had been put in, and we were expecting the trend to weaken, and green Dots to end (Micro trend).
Our first Target was said to be the Track line which was hit.
Now we are seeing a blue "B" bottom signal, followed by green Dots again! This is a high-probability setup!
If you like this analysis and want more like it, use the link HERE, to sign up for Trading Alpha.
ARB (WEEKLY CHART)
This chart only had enough candle bars to start activating the Micro Trend Dots. Now they will print live within each candle.
Now that they are active we are watching this potential double bottom.
What we want to see next is the trend to confirm the bottom pattern by printing its first green Dot. ARB has 6 more days in this weekly chart to pull off this confirmation. If it does we will have another high probability setup!
If you like this analysis and want more like it, use the link HERE, to sign up for Trading Alpha.
ETH (4-HOUR CHART)
Ethereum is printing its first green Dot once again. Notice how it held green Dots all the way before.
There is major resistance ahead, but this setup "could" be what we need to break resistance. I say that because the shading you see is telling us volatility is coiled up and needs to be released. If we keep those green Dots we should see an explosive move to the upside.
If you like this analysis and want more like it, use the link HERE, to sign up for Trading Alpha.
SOL (4-HOUR CHART)
Solana is printing its second consecutive green Dot, telling us that the market is trying to retest above resistance.
On Solana, I am not taking this setup. But I will be looking for a break of this grey line resistance. If we get it I will be using the Dots to keep us in the move just like it has on the way up! I will update everyone in the newsletter again so we don't miss the entry!
If you like this analysis and want more like it, use the link HERE, to sign up for Trading Alpha.
Bitcoin Stays Bullish On The Weekly
What a weekly candle. One clear technical sign of a bullish trend is increasing candle spread (bigger candle) on increasing volume. We have both of those things with last week’s candle. In addition, both the 50 and 200 MAs are angled up, which shows us the direction of the general trend. RSI is just hitting overbought, which is the power zone for high time frames.
Anything can happen, but all signs on this time frame are bull, bull, bull. That does not mean we won’t see some serious dips on lower time frames, which are still overbought.
Altcoin Charts
For those who are new here, I share SETUPS and not SIGNALS. These are ideas that I am watching - if a certain thing happens, then the trade triggers. I am not telling you what to buy or when. I am showing you how I am watching certain charts and what has to happen for me to take a trade.
At the moment the market still looks hot, but I am seeing a lot of overbought conditions and potential bearish divergence. Looking for dips to buy on coins discussed.
I use log (logarithmic), which shows that ATOM is right at a key resistance level. I am waiting for this break to get excited.
I chose to use Trading Alpha for this setup, because there is real confluence between the normal chart and the indicator. As you can see, we have a breakout through descending resistance on this chart (which is liner) that has been in place all year. Further, we have green dots and the track line… as resistance. I want to see a break above the track line which should really send this up.
So we have descending logarithmic resistance on my chart and the trackline as resistance on TA in the same spot… I won’t buy until I see those in the rearview mirror.
Legacy Markets
Stocks in Europe have rebounded from a recent 10-month low, specifically the Stoxx 600, which showed an upward trend. This improvement came as the Israeli military's actions in Gaza were perceived to be more cautious than anticipated by investors, avoiding a large-scale ground invasion. This restraint has reduced concerns about the conflict's escalation across the broader Middle East. The oil prices saw a decline, with Brent crude oil falling to $89 a barrel, and gold prices also dropped below $2,000 an ounce. In the bond market, ten-year Treasury yields rose to 4.86%.
This week is expected to be eventful for investors, with major central bank meetings scheduled in Japan, the US, and the UK. Additionally, the US Treasury Department will announce its quarterly bond sales plan. One key observation from market experts is that the weekend's relatively contained military operations may have provided relief to the markets, although there are still potential risks on the horizon.
The Israeli currency, the shekel, paused its recent decline, gaining 0.4% at 4.0566, even though it had been underperforming recently. A significant concern in the global financial scene is the potential impact of central banks' prolonged interest-rate policies, which have erased $12 trillion from the global stock market's value since July's end. A highlight of the week might be the Treasury Department's bond sales announcement, indicating the extent of longer-term debt sales to address the expanding budget deficit.
Lastly, HSBC Holdings Plc remained stable despite a pretax profit announcement that didn't meet analyst expectations, possibly due to the bank's share buyback plan of up to $3 billion.
Key events this week include:
China’s key financial policy gathering day, a rare closed door event led by Chinese President Xi Jinping, starts Monday
Japan unemployment, industrial production, retail sales, Tuesday
Bank of Japan rate decision, Tuesday
China non-manufacturing PMI, manufacturing PMI, Tuesday
Eurozone CPI, GDP, Tuesday
US construction spending, ISM Manufacturing, job openings, Wednesday
US Treasury quarterly refunding announcement, Wednesday
Federal Reserve rate decision, Wednesday
Bank of England rate decision, Thursday
China Caixin services PMI, Friday
Eurozone unemployment, Friday
US unemployment, nonfarm payrolls, Friday
Here are some of the main moves in markets:
Stocks
The Stoxx Europe 600 rose 0.7% as of 9:58 a.m. London time
S&P 500 futures rose 0.6%
Nasdaq 100 futures rose 0.8%
Futures on the Dow Jones Industrial Average rose 0.5%
The MSCI Asia Pacific Index fell 0.2%
The MSCI Emerging Markets Index rose 0.4%
Currencies
The Bloomberg Dollar Spot Index fell 0.2%
The euro rose 0.2% to $1.0583
The Japanese yen was little changed at 149.61 per dollar
The offshore yuan rose 0.1% to 7.3260 per dollar
The British pound was little changed at $1.2130
Cryptocurrencies
Bitcoin was little changed at $34,559.57
Ether rose 1.2% to $1,818.71
Bonds
The yield on 10-year Treasuries advanced three basis points to 4.86%
Germany’s 10-year yield declined three basis points to 2.80%
Britain’s 10-year yield was little changed at 4.55%
Commodities
Brent crude fell 1.4% to $89.19 a barrel
Spot gold fell 0.5% to $1,996.97 an ounce
Stablecoin Adoption Soars In Brazil
In 2023, Tether (USDT) adoption skyrocketed in Brazil, comprising 80% of the country's cryptocurrency transactions. The total USDT transactions hit around $55 billion, almost double Bitcoin's transaction volume. This surge started in 2021, overtaking Bitcoin in July 2022 during a tough time for crypto, marked by significant financial firms' collapse. The Brazilian authorities have ramped up crypto regulation and monitoring, recently legislating tax rules for overseas crypto earnings and requiring exchanges to disclose user transactions. International and local exchanges continue operating in Brazil amidst these developments.
Elon Musk Says X Will Replace Banks Next Year
Elon Musk is steering X to become a comprehensive financial hub aiming to replace traditional bank accounts by the end of 2024. During an internal call, Musk expressed ambitions to encompass all monetary transactions on X's platform, extending beyond mere payments to cover the broader financial spectrum. The roadmap includes acquiring necessary money transmission licenses across the US. Musk's vision for X, drawing from his early blueprint for PayPal, sees the platform offering a variety of financial services, like high-yield accounts and real-time global money transfers. The journey towards transforming X into a "super app" akin to China's WeChat does pose challenges in gaining user trust and adoption.
Super Bullish: Raoul Pal Deciphers Bitcoin's Surge & Crypto's Economic Takeover!
Don't miss out on this must-watch interview with Raoul Pal. We delve into crucial topics such as the economy, Bitcoin, alternative cryptocurrencies (alts), non-fungible tokens (NFTs), the Bitcoin Spot ETF, and the involvement of institutional investors. If you're looking to gain a bullish perspective on the world of cryptocurrency, this is an opportunity you won't want to miss.
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TheWolfOfAllStreets.io - The most comprehensive collection of everything I have going on. Plus over 100 blogs and other exclusive content.
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.