Cryptic ball: i'm the one that shorts away.
I've been telling times like these are full of chop. Last afternoon, in US hours, bitcoin and the myriad of alts which follow it pumped some 5% again, cancelling Monday's "Marge-induced" dip. Is this bullish or can one expect further fear?
- Overall, it seems we're trading in a new range. While May it was all about $28.5k to $30.5k, now the lower end remains but the corn is only finding sellers between $31k and $32k. It may sound like a small difference, but the looser the range the safer it is - as tight trading implies a lack of interest.
- Then, even if the correlation between crypto and equities is weakening we can't forget it is still quite high. Yesterday's move followed a pump by the major US indices, SPX and Nasdaq, so there's not much to do other than following all markets and trying to catch moves in one right after they start in another.
- And, talking about such moves, while I remain convinced Q3 will show us true relief, we can't also forget that the world is worried about declining economic growth and rising inflation - i.e. stagflation. The IMF rang the bell about this yesterday so let's see how this new angle of the same old narrative unfolds.
Lastly, note that Puru Saxena - a TradFi trader I recommend following and who nailed December's top - has been arguing the current relief rally is coming to an end and we're about to begin the next leg down. Falling oil stocks will be the sign but let's keep an eye on this Friday's CPI data. It can still come out hot.
Chart art: burning off and on.
Three things: do I stay or run away.
- The DeFi Edge offers a framework for evaluating possible bear market winners and losers.
- Andrew Thurman offers tips to protect against this dumpooor season.
- Jon Hillis offers an explanation of how decentralised organisations win (and lose) against their more centralised counterparts.