Cryptic ball: just be aware of the stock market.
What a bounce! Bitcoin closed yesterday still below $30k, but as meme stocks pumped and the rest of Wall Street turned bullish again, it was time for crypto markets to turn the green lights on again. As we've been covering for the past months, these markets have been extremely correlated this year, so you can use your traditional equities acumen to guide your cryptic forays. But it's not over yet.
As talked Monday, it's all about clear messages from the central banks, and those haven't come yet. This was just a correction from the overreaction regarding the Delta variant, which is highly contagious but is not having a significant impact on the hospitalisations in the countries where it has spread, with studies also showing "no clear evidence for a change in disease severity". Not that bad, right?
However, note it's still summer and bitcoin hasn't left the range it has been stranded in since the end of May, which we explained in our doldrums piece and in our getting stuck on the title email. In it, we referenced the bottom of the range, which was - guess what - $28.9k. This was nearly two months ago and, today, BTC pumped 10% from $29.2k, so that would have been a great trade, right? There's no need to FOMO, though, but we're feeling positive the bottom is behind us.
Chart art: just be aware of resistances.
Market musings: just be aware of falling knives.
What next, then? Firstly, the "The B Word" conference we described Monday has just started. Its speakers are some of the biggest names in the industry, including the infamous Elon Musk, who is talking as we type, but also Twitter's Jack Dorsey, Ark's Cathie Wood, US SEC's Hester Peirce, and Blockstream's Adam Back. With the current momentum, it's expected Tesla's Technoking tries to make some jokes about the orange coin, or even doge, so let's see if people sell the news or not.
Secondly, both markets (crypto and stocks) still have a long away to go before the summer ends, and with low volatility and thin order books it's easier to manipulate prices. Yes, it's true that Alameda, one of this industry's largest quantitative trading firm, has been buying the dip below $30k and is clearly committed to continue doing so. And yes, it's also easier to pump, not just to dump! But note that bulls can lose their energy again - although we don't feel that will happen.
Why? Because it's clear the market is healthy. FTX, a major exchange which shares the same founder and CEO with Alameda, just announced a $900 million fund raising round from the world's top VCs! Not all VCs are good at timing bottoms - remember Telegram's TON? - but we're pretty sure this is more proof there's much money waiting to buy crypto once it's clear the bottom is in. That and the fact a new Goldman Sachs survey argues 45% of family offices want to invest in crypto!
The question is if you'll wait for confirmation or if you have been buying the dip? Just be mindful of falling knives, especially on alts, which tend to suffer if BTC goes into beast mode. Still, keep following ETH as the $2k level is significant, and if it holds then more traders in the sidelines will be convinced it's time to cut the holidays short. Just imagine if we close July above $37k, which was June's open!
Visual block: just be aware of alternative pumps.
Three things: just be aware people search what's new.
- There was recent FUD regarding the European Union banning anonymous crypto wallets, but that's not true. CoinDesk's David Morris explains it greatly.
- There was recent talk that Google Search Trend analysis isn't worth it, but that's not true. CoinMetric's latest State of the Network shows you why.
- There was recent hype about government-backed stablecoins, but that doesn't solve anything. So learn about this patent for a new stablecoin backed by sovereign debt, while still being independent. Developed by B21's founder!