Don’t miss last weeks podcast where Boomer and Hal hypothesize that forming an investment DAO is probably a terrible idea and so they are probably going to do it. Plus, Ukraine and soybeans, coming to you live from the ETH Denver.

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CHEAT SHEET

XRP is on the cheatsheet now after flipping ADA. Leave a comment if you own XRP or ADA giving us your thesis.

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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

• FTX To Launch Gaming Unit To Support Mainstream Crypto Adoption (Blockworks)

• OpenSea Hack: Key Takeaways on Web3 Security (Crypto Briefing)

• Russian Finance Ministry Says Crypto Shouldn’t Be Legal Currency (Blockworks)

• Cryptocurrency trading company Amber is valued at $3 billion after Temasek investment (cryptocoinsjournal)

• Canada's OSC Flags Tweets From Coinbase, Kraken CEOs (Crypto Briefing)

• Polygon Whitehat Rewarded $75,000 for Saving Billions in User Funds (Crypto Briefing)

• The Use of Crypto Cards with Cashback Grows in Argentina (Investing.com)

• Lil Yachty & Soulja Boy Implicated in Alleged Crypto Pump and Dump Lawsuit (VladTV)

• FBI Launches New Crypto Crimes Unit (CoinDesk)

BTC Outlook

Well, it looks like our worse case scenario that we were watching for last Thursday has now played out. Bitcoin was unable to hold support at $42k, the inverse head and shoulders pattern failed to play out and the price briefly tested $40k (big round number) before eventually meeting resistance at $37.5k as we called for. Last Thursday we suggested that a retest of $37.5k could hold as a higher low and thus a show of strength and the price continues higher again. This thesis is supported by a gap left in the CME Bitcoin futures near $40k.

You must watch closely what happens when BTC tries to break above $40k one more time. Failure here would likely result in more downside with a test of $30k. Currently, Bitcoin’s macro support price is around $23k. So, if you want to get long now save some cash for buying near $23k if we do go there. Shorting is hard here because the price is already down -50% from the highs. That’s why we are suggesting patiently averaging in if you feel the need to participate in this volatile moment.

Possible Course of Action (advice from last week still holds)

• Dip buying is still suggested (cautious dip buying!)

• If long, stay long and look for a retest of $40k

• Could try shorting near $40k at signs of weakness

The Bulls’ Defense:

• A bounce off $37.5k would be a higher low and a show of strength

The Bears’ Prosecution:

• Inverse head and shoulders failure

• $40k is now resistance

ETH Outlook

ETH sold off a bit harder than BTC and coincidently the selling started on the day the ETH Denver conference kicked off. Like BTC, even after the selling ETH is still structurally setup to put in a local bottom. The price ran up and was rejected near $3.3k and now is retesting the neckline of the breakout in February. Same as with BTC we are expecting some positive price action as BTC moves up to fill the CME gap. ETH’s next level of support under $2.2k is around $880. So, again just as with BTC if you are wanting to buy here we suggest preparing for the scenario where $880 is retested.

Possible Course of Action

• Cautiously scale into a long buying dips

• Do nothing and wait for more consolidation

• Open a short near $3k resistance on signs of weakness

The Bulls’ Defense:

• EIP-1559 has burned $5,016,644,230 (1,888,512 ETH) so far. Supply constraints should continue to have a positive impact on price.

• $2.5k holding as support is a show of strength

The Bears’ Prosecution:

• ETH price will stall out between $3k and multi-month weakness continues

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