For He's a Jolly Good Saylor
4 min read

For He's a Jolly Good Saylor

B21 Crypto. We help you stomach cryptoassets.

Cryptic ball: can't control the wind, but can adjust the sail.

As hinted, this has been a stable day in the crypto markets. And that's good. As the more we remain around $40, the more chances we have of climbing higher, as traders are interpreting this move as a pennant - as you can see in today's chart. This pattern suggests consolidation after a high-volume breakout, which is typically followed by another breakout. Moreover, a solid close above $42k makes us feel the chop is behind us and bulls are back! After all, even the director of Global Macro at Fidelity, a trillion-dollar asset manager, believes the bottom is in!

Why? On the one hand, and as always remarked since we started warning about the euphoria in the market, it wasn't likely that May's crash was the end of the bull market - unless an unexpected event would happen, like an exchange going bust. Secondly, fundamentals continue getting stronger! Take the most recent news that Goldman Sachs will start trading ether for its clients. Or that Microstrategy, after raising another $500 million to buy bitcoin, has just announced another $1 billion to buy more BTC! As the trader Hsaka says, "the man is redefining going all in".

Chart art: "we each have our oceans and seas"

This is what a textbook pennant looks like. Thanks to Elon, right?

Market musings: "a ship in the harbour is safe".

There's an additional on-chain indicator that's worth looking for hope. The stablecoin ratio compares the market cap of bitcoin to the market cap of all stablecoins held at exchanges. An increase in this ratio indicates cryptoasset exchange users are holding more BTC than stablecoins - which represent fiat currency used to escape the volatility and to take profits.

Conversely, a decrease in this ratio typically indicates selling pressure, as the value of stablecoins - the denominator in the formula - is rising compared to bitcoin's. And what happens when the ratio bottoms? Selling pressure is likely exhausted, which allows for bulls to regain control. As you can see in the chart below, that has been the case for the past two years! So, as we've now reached again that critical support level, remember ships weren't built to stay in the harbour.

Visual block: do you yearn for the vast and endless sea?

Source: CryptoQuant's Cole Garner. Click on the image to know more.

Three things: the optimist expects the wind to change.

Tweet tip: "to succeed at sea we must keep things simple".

He is just the director of Global Macro at a multi-trillion dollar asset manager.

Meme moment: "the sea finds out everything you did wrong".

Even though we're bullish, that doesn't mean you should not take profits.

The Desi Crypto Show: learn more about Near Protocol.

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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 guidance in the report will lead to any particular outcome or result.