The Comeback Kid
Yesterday, markets were red across the board. Can Bitcoin reclaim $30k?
We just released Boomer’s Guide to the Bear Market. This Private Podcast focuses on the depegging of Tether, the blow up of Terra USD, how it relates to traditional markets, and possible contagion. Available to Premium Subscribers only.
Cheat Sheet -
Support and resistance levels and our daily, weekly and monthly bias on BTC, ETH, OIL, ES, and NQ as well as our favorite altcoins.
Crypto News
Ethereum on Track for Testnet Merge in June (Coindesk)
FTX US Debuts Stock Trading in Push for Bigger Slice of US Retail Pie (Coindesk)
Mike Novogratz Ends Twitter Silence, Shares Take on UST/LUNA Crash(Coindesk)
South Korean watchdog reportedly fines Terraform Labs $78M for tax evasion (Cointelegraph)
Coinbase launches new crypto think tank to help shape policies (Cointelegraph)
Aave Launches Alternative to Traditional Social Media (Blockworks)
China Reemerges as Top Mining Hub a Year After Blanket Ban (Blockworks)
Web3 Watch: Spotify Trials NFTs and Madonna’s First NFT Collection (Blockworks)
CFTC Expected to Add More Resources to Better Monitor Crypto Markets (Decrypt)
Andreessen Horowitz Launches $600M Fund Focused on Metaverse Games (Decrypt)
BTC Outlook
The last few days it appears BTC was forming a head and shoulders pattern when trying to rally off the recent wick down to the mid $20ks. Yesterday afternoon’s price action made it appear BTC was about to complete the head and shoulders breaking down under the neckline. However, buyers were waiting and brought the price back up above the neckline quickly. One of our trading rules applies here, “when you are wrong you are often more wrong than you’d ever imagined". In this case the head and shoulders turned into a bear trap and we expect a retest of $30k at minimum.
We aren’t out of the wood yet. Global risk assets continue to appear uncertain. Expect more consolidation in the coming week(s).
Possible Course of Action
Long under $30k expecting to fill the CME gap at $36k
Do nothing and wait for further consolidation
Short any weakness looking for short term trades
The Bulls’ Defense:
Head and Shoulders rejected
The Bears’ Prosecution:
Global macro uncertainty
Still trading under $30k
ETH Outlook
Over the last week, ETH has traded weakly against BTC. Since, the rejection of this bull flag ETH continues to slowly lose steam. However, we are expecting consolidation at these levels as ETH has traded here historically versus BTC for some time. Most likely the ETH/BTC pair will continue to consolidate or even sell off as long as tech stocks are selling of or consolidating.
There’s not a clear direction here. We will continue to monitor and update you as soon as there is some movement!
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 more beta
The Bulls’ Defense:
EIP-1559 has burned $4,662,467,042 (2,347,856 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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