Cryptic ball: let's hope the monthly close goes smoothly.
As explained Wednesday, bitcoin's pump has come to a pause. The orange coin has been falling for two days and finally broke below the triangular pattern it was forming since Monday's early pump - as shown below. Meanwhile, ether continued appreciating and has printed new highs, also detailed in today's chart art, as the diagonal line that's currently supporting this bullish trend is key for the weekend. Why? Just see how bitcoin dumped with high volume in analogous situation.
Overall, it feels tomorrow's monthly close won't bring much more volatility to the market than that we're currently experiencing. This is great as there are finally some great trading setups. Most major alts are experiencing classical breakouts and as long as bitcoin remains in this sideways range with ether continuing to recover you can expect these more risky trades to play out as expected!
Chart art: let's hope this is a new sideways range.
Market musings: let's hope you scout some nifty projects too.
Now, the question is in which alts to bet. That's impossible to say, so you'll need to be on the look-out for good setups around good quality projects and manage your risk. However, there are some sectors which are more hyped than others. While in 2020 we saw the "Summer of DeFi", it seems now we're about to see the "Summer of NFTs". It all started with Axie Infinity's AXS, which we first talked about here on the 9th and 16th of July, when its price was 11$ and $23 USD, respectively.
Today, AXS is trading around $42, having reached an ATH of $52 this Wednesday. This token - which powers governance in the Axie Infinity popular Pokemon-inspired, NFT-fuelled game - pumped due to real utility, but it has now achieved a wild valuation. While one never knows when a pump will end, it's clear that investors are looking for projects that around them to capitalise on the hype around the non-fungible space, even if they're not directly investing in NFTs.
After all, the NFT hype was initially drive by market that's set by a few buyers and sellers, who manipulate the prices at which artwork is sold for publicity purposes. But, outside that market, there are plenty of applications, especially in the videogame and metaverse zone, which benefit from NFTs and the value accrued by them is captured by other tokens which are traded in more liquid markets. This is our thesis for August, so let's see how it plays out - especially now that Forbes has launched their new "NFTy 50" list with the top influencers in the space!
To conclude, note next week this newsletter will be sent out Tuesday, Wednesday, and Thursday instead of the usual Monday, Wednesday, and Friday schedule.
Visual block: let's hope their wallet mapping is right.
Three things: let's hope the metaverse is decentralised.
- Learn why Axies Infinity is "the craziest crypto game ever"!
- Learn why scaling blockchains is difficult and why decentralisation helps!
- Learn why the metaverse should be open and what its OS should look like!