The Phoenix Rises
Discover more from Foot Guns
The Phoenix Rises
Bitcoin back above $40k as most popular Twitter accounts still calling for $20k
Want the Cheat Sheet delivered to your inbox daily, year round?
CHEAT SHEET
Altcoins We Are Watching
Crypto News
Tether's Paolo Ardoino on UST: 'It's All Fun and Games' Until You're a $100B Coin (CoinDesk)
‘Jack Dorsey’s First Tweet’ NFT Went on Sale for $48M. It Ended With a Top Bid of Just $280 (CoinDesk)
Bitcoin institutional buying ‘could be big narrative again’ as 30K BTC leaves Coinbase (CoinTelegraph)
President Biden announces former Ripple adviser as pick for Fed vice chair for supervision (CoinTelegraph)
Making Bitcoin legal tender in Mexico will be ‘an uphill battle,’ says Ricardo Salinas (CoinTelegraph)
Ethereum DeFi Protocol Beanstalk Hacked for $182 Million (Decrypt)
Terra's Stablecoin UST Becomes Crypto's Third-Largest (Decrypt)
Digital Funds Seeks to Launch Tokenized S&P 500 Fund (Blockworks)
WonderFi Continues to Consolidate Canadian Market With Second Acquisition (Blockworks)
Russian Crypto Bill Amendment Targets Mining, Trading (Blockworks)
BTC Outlook
Bitcoin has been forming this massive ascending wedge ever since the price fell below $45k in December. Sellers are consistently coming in at $45k and driving the price back below $40k. However, each move down has resulted in a higher low. The price volatility has also been compressing now with the price moving into the tightest region of this wedge pattern. While it is possible there is another wick down to test $38.5k, most likely Bitcoin will trade between $40k and $45k in the coming week(s) testing the sellers in this region and the resolve of holders and new buyers. The last rise above $45k was a bull trap, buyers may be timid about following a breakout here.
Possible Course of Action
Do nothing wait to buy breakdowns of this pink downtrend line (worked well last week)
Short rises above $45k
Long here expecting a retest of $45k
The Bulls’ Defense:
Higher lows show a sign of support
The Bears’ Prosecution:
Price could break the rising lows
ETH Outlook
We are continuing the follow the ETHBTC pair as BTC grasps onto $40k. ETH has been trading within 3% of the BTC price movements since early April. This shows that buyers are not scrutinizing crypto and just pressing the buy button on the top two (Chipotle Dad’s buying ETH because it’s “cheaper” than BTC). This consolidation over April appears to be forming a bull flag. The problem with bull flags in crypto is they are hard to distinguish from the dread Bart Simpson pattern. What looks like a bull flag resolves to the point where the breakout first occurred. In this case that would be about 0.072 ETH/BTC ratio. We expect that this bull flag will in fact break to the upside if BTC rallies and otherwise BTC moving back below $38.5k will bring ETH down with it and ETH will probably go down faster. Basically, as per usual ETH is a good way to add Beta to your BTC trade.
Possible Course of Action
Buy ETH on the bottom side of this flag
Do nothing, wait for a break out to the up or downside of the flag
Short if BTC shows weakness
The Bulls’ Defense:
EIP-1559 has burned $6,528,955,316 (2,131,674 ETH) so far. Supply constraints should continue to have a positive impact on price.
Potential Bull Flag
The Bears’ Prosecution:
Potential Bart Simpson sell off
Please don’t forget to like (heart button at bottom) and share this post!