Support and resistance levels and our daily, weekly and monthly bias on BTC, ETH, OIL, ES, and NQ as well as our favorite altcoins.

Cheat Sheet

Crypto News

• UST Stablecoin Loses Dollar Peg for Second Time in 48 Hours, LUNA Market Cap Falls Below UST's (CoinDesk)

• Meta’s Instagram to Support NFTs From Ethereum, Polygon, Solana, Flow (CoinDesk)

• Michael Saylor Suggests MicroStrategy Will Never Sell Its Bitcoin (CoinDesk)

• Binance temporarily suspends LUNA, UST withdrawals citing network congestion (CoinTelegraph)

• One-fifth of businesses in El Salvador now accept Bitcoin (CoinTelegraph)

• Flow Blockchain Raises $725 Million Ecosystem Fund From DCG, a16z and Others (Decrypt)

• Twitter Declares 'Death' of Azuki NFT Collection Following 45% Price Drop (Decrypt)

• Argentina’s Central Bank Bans Crypto Trading (Blockworks)

• In Industry First, S&P Gives Compound Prime Junk Credit Rating (Blockworks)

• Jamaica To Launch CBDC This Summer (Blockworks)

• Luna Foundation Guard To Support Struggling UST Peg With BTC Reserves (Blockworks)

BTC Outlook

If you missed it when it was published, today is a good day to go read or reread our article about The Rule of Big Round Numbers. 

Bitcoin is hunting for its Big Round Number. The 2016-2000 Halvening cycle found Bitcoin’s price fixated on $9000. Of course, remember that the low of the cycle was ~$3000!

The last 6 weeks Bitcoin has been selling off and last night, around midnight in NYC, the Bitcoin price went under $30,000 twice. We were hanging out in the Foot Guns’ discord and I caught a few high leverage longs off the bounce because I noticed Bitcoin’s price was being rejected from $30k like a hot potato. This makes sense based on our rule of Big Round Numbers so I started buying highly levered small position and closing them out 15 minutes later for nice returns. Sometimes it’s about time in the markets, but under highly volatile price action timing and limited time in the markets is king.  If you were up last night wondering what was going the Foot Guns’ discord was active following this price action and what was happening with UST/LUNA.

Anyways, I don’t think it’s going to be that easy. Expect $30k to be retested after some relief rally. The stock market has just opened at the time of writing this and sellers are coming back in.

Possible Course of Action

• Long under $30k expecting to fill the CME gap at $36k

• Do nothing and wait for further consolidation

The Bulls’ Defense:

• Bounce of $30000 big round number

The Bears’ Prosecution:

• Global macro uncertainty

• Bear flag broken down

ETH Outlook

We’ll take a break from tracking the ETH/NASDAQ correlation to following the ETH/BTC pair. It looked like our prediction was coming true that ETH would fall out of this bull flag if BTC started selling off, but now look what is happening. Once BTC bounced off $30k the ETH/BTC ratio started breaking out. Many more dip buyers came in to pick up ETH than BTC. Boomer and I still stick to our theory that this is because CME futures exists for ETH and Chipotle dad’s everywhere see ETH having a cheaper price relative to BTC. I think CME traders are guilty of this was well.

Mind you even if this bull flag break outs, then only a 3.5% relative gain is expected in the ETH/BTC pair. If BTC goes to $25k ETH will be trading below $2000 and you probably won’t be super excited about your 3.5% relative gain!  

Possible Course of Action

• Caution here as ETH is highly correlated with the tech stock sell off

• Wait for further consolidation and confirmation of a higher low

• If you want to be long BTC, you can be long ETH for that extra 3.5% return!

The Bulls’ Defense:

• EIP-1559 has burned $5,549,598,798 (2,294,190 ETH) so far. Supply constraints should continue to have a positive impact on price.

The Bears’ Prosecution:

• Global macro uncertainty

• Nasdaq correlation and sell off

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