Ever the grand dump
4 min read

Ever the grand dump

B21 Crypto. We help you stomach cryptoassets.

Cryptic ball: things look shaky.

We hate to be right when prices crash, but Friday we told you were going neutral, hedged, and flat towards this weekend. And Saturday and Sunday weren't volatile, indeed. But right after the weekly close, bitcoin dumped 10% and bounced right at the key $42k level, which we have been talking about since April! It dragged down the rest of the market, which fell up to 13%, with some tokens losing 19%!

What next? Well, Friday we also mused about how this slow bleed made us feel like we would find a bottom soon. Is this it or not? Today's rinse has indeed hurt many, although the fear level hasn't changed much. What's key now concerns two things that have caught our eye recently, and seem to be correlated with this bearishness: the SEC's actions and sentiment regarding global equities, given that the correlation between BTC and the S&P500 is at a yearly high. Read along!

Chart art: but this is a good dip.

In brief, $42k is a great place to long. But because it's such a good place, it may be the case that bears will attempt to nuke it one more time, like in the triple test of $30k last June/July.

Market musings: however, equities rule right now.

First, news just came out as we're writing this newsletter that Coinbase is abandoning plans to launch its Lend program. If you remember September 7th's dip, we attributed it to possible insider trading regarding the fact the US SEC was threatening the popular exchange regarding that same launch. Coincidence? Maybe not. Anyway, there are other fundamental reasons for the crash.

As widely reported, global markets are heating up to unsustainable levels. Last week concerns were rising and, this morning, Asian markets woke up in the red with the prolonged fall of Evergrande. The sell-off has extended to Europe and America, with the S&P 500 falling 2% (which seems a minor drop, but it's the first lower low since last year!) and talks of a natural gas crisis scaring traders in the old continent. So, from a technical perspective, we believe $42k is going to hold. But it will be up to the Fed to prop up the markets one more time and allow bulls around the world to feel safe enough to roam free again, unaware of their caged farms.

Visual block: and only long-held beliefs can save us.

As you can read above, we're urging caution as this week will likely be volatile. But, as explained many times before, we remain bullish due to this great meme. Click on the image to learn more about the halving and what does it mean for market cycles.

Three things: so keep studying the market!

Tweet tip: don't do anything foolish.

Haven't been able to verify this, but follow this great conference to find out! The SEC is out there to catch all the Americans dealing with unregistered securities, and that can close casinos around the world.

Meme moment: and remain young and stable!

Not, bad. Even if not original, this is not bad - at least for the fashion retailer with that name!

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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.