To freedom!
4 min read

To freedom!

Cryptic ball: to the Bahamas!

As explained Friday, this was to be a risky weekend. So it was without surprise that bitcoin failed to break $40k for three times and then fell up to 5% this morning - bouncing back a little over the past hours. So, what's the playbook for this week?

  • Overall, we're still struggling with a bearish backdrop on the macro front. I do believe that the Fed will tone down once (and if) it's clear inflation has peaked in order to continue propping up the economy. The question is when.
  • With the exception of the DeFi Summer of 2020, the warmest season of the year in the Northern Hemisphere is typically muted across all markets. So our chances of a serious bounce become lower as June's solstice approaches.

Moreover, BTC and ETH trading volumes are at their lowest since last July, while bitcoin's realised volatility just hit a 17-month low. In other words, few people are interested in the markets right now and that doesn't help.

  • Fortunately, if in 2018 such lacklustre activity was the beginning of the end, these days things are different. Institutions are here and they start to perceive bitcoin and other cryptoassets to be intrinsically valuable.
  • As explained by Jurrien Timmer, director of Global Macro at Fidelity (which manages $4 trillion in assets), bitcoin is indeed getting boring but that's good as it signals institutions are buying the dips (and shorting euphoria too)!

What this means for a regular trader is that it's unlikely we get massive opportunities this Q2. As I often said at the beginning of the year, Q1 was likely going to be bearish (it was) and Q2 should provide a chance for recovery.

  • After that, we should get the bulls back for the end of the year party. And while now this chance of recovery seems slim, i.e. I'm more inclined we continue to see sideways ranges for some months, I also believe the market is healthy.
  • As I'm landing in the Bahamas for this week's conference I can't help but wonder how far this industry has come in such a short time. Yes, Elon managed to pump DOGE a bit again, but we're getting more resilient by the day!

Let's just hope the stock market carnage doesn't entice bears again. Because of the S&P 500 drops more than 2% from the current level, we must get ready for some serious volatility. If that happens, expect bitcoin to test $36k first and then $32k!

Chart art: to boredom land!

Not so interesting, but not so bad also.
Time for volatility to spike again. 
Let's just hope it's not to $30k (ignore the max pain price, unlikely to get there in this context).

Three things: to sustainable yields!

Tweet tip: to the rotators!

The rotation game is even more difficult than trading.

Meme moment: to the coupon course!

30% APR, Justin, but how will it survive? For context here's a must-read.

FV Bank: meet us at Crypto Bahamas.

Come and meet our founders, Miles Paschini & Nitin Agarwal, at this exclusive gathering of investors & builders in the blockchain, digital assets and web3 space - hosted by FTX and SALT.

Get started: learn more about FV Bank.

Get started: download the B21 Crypto app!

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Our newsletter offers opinions and insights from analysts in the cryptoasset space. It is not intended to be investment advice, and should not be treated as such. You must not rely on its information as an alternative to financial advice from a qualified professional. Without prejudice, we do not undertake or guarantee that its information is correct, complete or non-misleading; or that the use of the guidance in the report will lead to any particular outcome or result.