FG Cheat Sheet 020122
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FG Cheat Sheet 020122
Monthly Candles closed last night. Check the cheat sheet!
Don’t miss last weeks podcast where we discuss the dramatic events unfolding at Wonderland finance.
CHEAT SHEET
What We Are Watching
We further breakdown our case for these cryptos here : What We Are Watching
Are you buying these tokens? Did you read our guide on how to buy them on Sushiswap and Uniswap? Got questions? Leave them in the comments.
Crypto News
Trezor fixed a vulnerability in its hardware wallets after a man hacked into one
India is launching a digital currency and will charge 30% tax on crypto income
Last week, IMF asked El Salvador to drop BTC as legal tender - this was their response
Third largest recording company, Warner Music Group, partnered with NFT platform OneOf
BTC Outlook
Bitcoin is back at the top end of this declining range. If you read the news above just about any bullish thing you can imagine seems to have happened today. Saylor bought, Russia admits to holding large bags, and India put forward somewhat reasonable tax laws for crypto. If the price can’t buck the trend here then certainly expect $30k to be retested. The safe strategy would be to buy when the price goes above this trend line and then confirms a retest by making a higher low above the line.
This is could be a decent place to short (or $40k), but I would watch that short like a hawk with a somewhat tight stop.
Possible Course of Action (advice from last week still holds)
Scale into a long here buying any dips
If long, stay long and look for a retest of $40k
Could try shorting near $40k
The Bulls’ Defense:
The outside reversal we pointed out has now played about and we have a short term change in the direction of price action
The Bears’ Prosecution:
If buyers don’t come in on string of bullish news then what else could spark a turn around at these levels?
ETH Outlook
ETH’s price action is looking good. If we include that upward wick in the middle it was a W bottom, include the bottom wick and it was an inverse head and shoulders. However, you want to call it that looks like a temporary bottom to me. ETH will probably retrace to these 0.618 and 0.5 Fibonacci levels. These will now act as points of resistance so if you bought the bottom here look to lighten up around $3k and $3.3k.
ETH buyers are coming back simply because BTC stopped going down. In 2021 many small players were pushed out of ETH because of the high gas costs. This does not mean ETH adoption wont continue by larger players. As much as we are frustrated by the high gas costs we expect ETH’s popularity to continue to rise along side cheaper L1s and L2s.
If ETH makes it to $3k/$3.3k you could try a short looking for a short term pullback.
Possible Course of Action
Could look to open a long here betting on a return to $3000
Open a short near resistance ($3k, $3.3k)
The Bulls’ Defense:
EIP-1559 has burned $4,830,860,198 (1,722,311 ETH) so far. Supply constraints should continue to have a positive impact on price.
Short term bottom has formed
The Bears’ Prosecution:
ETH price will stall out at $3k and weakness continues
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