I'ts been a while! My posts will likely to continue to be sporadic, but I thought I'd share some thoughts on the current situation. I have a lot more to say, but my time is limited these days.
So here it goes.
I think it's become pretty clear that *if* crypto is the future of finance, Ethereum is not it. I feel like I've exhausted all my arguments as to why I think a future where cryptocurrencies are more prominent wouldn't necessarily be a good one, so I'll make this short and sweet.
It does seem that the market found some support after the major bank debacles. I was thinking BTC could see a throwback to the $19.8k level before breaking $25k. This test seemed to be needed, and now we see prices not reflected in the charts for quite some time. I have actually been suggesting that Bitcoin could make a run towards $30k, but it had been taking so long to play out that I had all but given up on the idea. In one of my last posts I mentioned two things:
1) I did not think we had seen the last of the "black swan" events in crypto. CHECK
2) I did not think we had even seen the first major "black swan" event in traditional markets. CHECK. For this, I'm not including the Ukraine war, but what I meant is a more systemic problem, i.e. SVB.
I've also mentioned numerous times that I thought CZ and Justin Sun would be the last ones to fall. Now, both are being officially investigated. All this has happened since my last posts.
Even though both of these have come to pass, the market is actually making an attempt at a comeback. But how authentic is it? Liquidity continues to be restricted in the crypto world, and even CZ is feeling the heat. I was honestly surprised to not see a 100% bounce from the lows sooner - I expected a little more from the market. But this is has all been pretty slow-moving. Now, it appears there is an attempt at re-establishing a weekly and monthly uptrend.
This attempt comes at a very precarious moment for the market - namely the downtrending of some important longer-term MA's. If this bounce falls apart soon, these trends will likely continue to solidify their downwards trajectory. All it takes is for Bitcoin to dump back to $20k, and that death cross starts to seem much more significant. It really needs to hold above the 200 week MA for a while to restore confidence.
Bitcoin is only testing the $28.5k level, which was major support in 2021. Resistance here is expected - so let's see if it can push a bit higher towards the 100 week MA near $34k.
In the short term, I'm watching Ethereum. I decided to title this post after ETH because I think we're at the phase where final distribution for alts is occurring. Throughout all of last year, Bitcoin dominance remained stubbornly low, which was a departure from the previous bear market.
Only recently has ETH/BTC officially broken a major long term uptrend:
The ETH/USD chart shows a new local low.
It's a difficult time to trade, but I think a break below those orange trendlines could send it right back to the $1400 level. I also think a breakout above the resistance could lead to a false pump above $2k, which I do not think is likely to sustain due to the presence of constant sell volume in this range. On the weekly, a tap of the 100 MA (yellow) is possible for both BTC and ETH, but a large dump to new lows seems just as possible, with a weekly death cross (red over teal) looming.
TL: DR: I'm watching for EITHER a final short squeeze manufactured by CZ and perhaps other entities with whom he's already cut deals. But, I'm not necessarily betting on the short squeeze as it could attract even more attention from regulators, especially if an attempt is made to siphon profits into other markets. The jig seems to be almost up, at least. I mean come on, CZ himself said he was pumping the market right before Bitcoin took off above $25k. You cannot make this up.
As for Bitcoin's fundamentals...well, the banking crisis is a perfect opportunity to manufacture hope. "Maybe this is it! The moment we've all been waiting for!" Let's wait and see how it all plays out. Sure, maybe I'm wrong and I was initially right about crypto - that it was worth having at least some. I'll need a bit more to be convinced.
The "hope" I mentioned above is really fear in disguise. I do not think a market driven almost entirely by fear is sustainable. Stick around in this market long enough, and perhaps you'll see what I mean.
Anyway, as always this is not meant as financial advice! This is meant for speculation and entertainment only. Let's sit back and enjoy the show!
So here it goes.
I think it's become pretty clear that *if* crypto is the future of finance, Ethereum is not it. I feel like I've exhausted all my arguments as to why I think a future where cryptocurrencies are more prominent wouldn't necessarily be a good one, so I'll make this short and sweet.
It does seem that the market found some support after the major bank debacles. I was thinking BTC could see a throwback to the $19.8k level before breaking $25k. This test seemed to be needed, and now we see prices not reflected in the charts for quite some time. I have actually been suggesting that Bitcoin could make a run towards $30k, but it had been taking so long to play out that I had all but given up on the idea. In one of my last posts I mentioned two things:
1) I did not think we had seen the last of the "black swan" events in crypto. CHECK
2) I did not think we had even seen the first major "black swan" event in traditional markets. CHECK. For this, I'm not including the Ukraine war, but what I meant is a more systemic problem, i.e. SVB.
I've also mentioned numerous times that I thought CZ and Justin Sun would be the last ones to fall. Now, both are being officially investigated. All this has happened since my last posts.
Even though both of these have come to pass, the market is actually making an attempt at a comeback. But how authentic is it? Liquidity continues to be restricted in the crypto world, and even CZ is feeling the heat. I was honestly surprised to not see a 100% bounce from the lows sooner - I expected a little more from the market. But this is has all been pretty slow-moving. Now, it appears there is an attempt at re-establishing a weekly and monthly uptrend.
This attempt comes at a very precarious moment for the market - namely the downtrending of some important longer-term MA's. If this bounce falls apart soon, these trends will likely continue to solidify their downwards trajectory. All it takes is for Bitcoin to dump back to $20k, and that death cross starts to seem much more significant. It really needs to hold above the 200 week MA for a while to restore confidence.
Bitcoin is only testing the $28.5k level, which was major support in 2021. Resistance here is expected - so let's see if it can push a bit higher towards the 100 week MA near $34k.
In the short term, I'm watching Ethereum. I decided to title this post after ETH because I think we're at the phase where final distribution for alts is occurring. Throughout all of last year, Bitcoin dominance remained stubbornly low, which was a departure from the previous bear market.
Only recently has ETH/BTC officially broken a major long term uptrend:
The ETH/USD chart shows a new local low.
It's a difficult time to trade, but I think a break below those orange trendlines could send it right back to the $1400 level. I also think a breakout above the resistance could lead to a false pump above $2k, which I do not think is likely to sustain due to the presence of constant sell volume in this range. On the weekly, a tap of the 100 MA (yellow) is possible for both BTC and ETH, but a large dump to new lows seems just as possible, with a weekly death cross (red over teal) looming.
TL: DR: I'm watching for EITHER a final short squeeze manufactured by CZ and perhaps other entities with whom he's already cut deals. But, I'm not necessarily betting on the short squeeze as it could attract even more attention from regulators, especially if an attempt is made to siphon profits into other markets. The jig seems to be almost up, at least. I mean come on, CZ himself said he was pumping the market right before Bitcoin took off above $25k. You cannot make this up.
As for Bitcoin's fundamentals...well, the banking crisis is a perfect opportunity to manufacture hope. "Maybe this is it! The moment we've all been waiting for!" Let's wait and see how it all plays out. Sure, maybe I'm wrong and I was initially right about crypto - that it was worth having at least some. I'll need a bit more to be convinced.
The "hope" I mentioned above is really fear in disguise. I do not think a market driven almost entirely by fear is sustainable. Stick around in this market long enough, and perhaps you'll see what I mean.
Anyway, as always this is not meant as financial advice! This is meant for speculation and entertainment only. Let's sit back and enjoy the show!
