This is the video recording of our August 27, 2021, All Star Charts Crypto Weekly Strategy Session.
Playing Devil’s Advocate
In recent weeks, we’ve been discussing the potential upside in the altcoins if Bitcoin gets back into the 60,000’s.
We’re talking doubles and triples, at least…
There’s no doubting that we’ve held a more bullish view when Bitcoin was hovering in the 30,000’s, and more recently when Bitcoin resolved higher into the 40,000’s.
But as always, we need to remain objective in our approach and look for cracks in our thesis.
It’s one of many reasons why we always play devil’s advocate; that is, collating a list of data points that go against our thesis and would subsequently make us change our perspective.
Let’s not forget, flipping our approach as new evidence comes in is not only an advantage, but in public markets, it’s a necessity.
So with that said, what if this isn’t as clean a breakout as we initially intended?
The Cryptocurrencies We’re Watching
As we laid out in yesterday’s call, if Bitcoin is in the 50,000’s, we need to be aggressively long crypto.
There’s just no way around it.
Above 47,000, the bias is clearly higher toward the first half highs: [Read more…]
[Crypto] Weekly Strategy Session – August 23, 2021
This is the video recording of our August 23, 2021, All Star Charts Crypto Weekly Strategy Session.
How to Pick Winners
What are the things we look for most when trying to identify leadership?
First, it’s all relative. When the market is selling indiscriminately, this becomes more challenging. You’re literally looking for the assets that get hit the least. It’s not until the volatility subsides that we start looking for those that rebound out of it the strongest.
In today’s post, we’ll use the recent selloff and rebound in crypto as a case study for how we pick winners out of a loser’s market.
Here are two of our favorite ways to find future outperformers:
- Relative resilience during selling pressure.
- Relative momentum and strength – both into the peak and off the lows.
With the former, we can use tools like relative strength – or, rather, the absence of weakness – in addition to chart characteristics like bullish divergences and momentum not hitting oversold.
With the latter, we’re again looking at relative strength. Who were the biggest gainers since the market bottomed? Who are the first to take out their AVWAP from the highs and/or other key levels?
Which tokens are already back at new all-time highs? If it sounds simple, it’s because it is.
Under the Surface Strength
If there’s one prevailing theme right now, it’s that there’s a growing list of cryptos making new highs.
It all started with Cardano, and we know how that turned out…
For us, it’s very simple. The coins that are among the first to breakout are the strongest names and will continue to lead the asset class higher.
As we said in yesterday’s note, if you’re solely focused on Bitcoin wedged under resistance, you’re not seeing the strength under the surface:
Just take a look at the Altcoins reasserting leadership versus Bitcoin at this very logical level.
Placing Our Bets on Crypto’s Leaders
Cardano was the talk of the town last week.
Even though our initial target of 2.20 was hit within a matter of days, let’s not underestimate the implications of this base:
With a breakout of this magnitude, this thing could be at $10 in no time.
It’s no joke.
But it’s not just Cardano showing incredible leadership right now.
If you’re solely focused on Ethereum and Bitcoin, you’re not seeing the whole picture.
[Crypto] Weekly Strategy Session – August 13, 2021
This is the video recording of our August 13, 2021, All Star Charts Crypto Weekly Strategy Session.
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