This is the video recording of our September 17, 2021, All Star Charts Crypto Weekly Strategy Session.
Crypto as an asset class can be very intimidating.
There’s so much jargon and nomenclature thrown around, and the drivers of these tokens are very different from traditional markets.
And it’s certainly not getting any simpler. There’s a flourishing list of smart contract platforms, defi protocols, and other projects, all with their own objectives, purpose, and communities.
Whether you’re a developer or a humble trader looking to lend and borrow in the world of defi, the market is becoming so oversaturated with all these protocols that it becomes downright daunting to even touch it.
But I think we can all take solace in the fact that no one is a complete expert in this stuff.
This isn’t commodities or stocks where a group of oldtimers have decades of experience dealing with these markets. Crypto has been around for less than a decade, and in the case of the biggest names in the asset class today, less than a few years.
And even from a research and analysis perspective, up until this point, the entire industry of on-chain analytics was done by a select number of people. Only in the last 12-months has the industry started to pick up (and by pick up, I mean less than half a dozen data providers and full-time analysts).
The point is, other than a very select number of individuals, cryptocurrencies are new to everyone.
If you’re feeling bogged down by all the information thrown out there, don’t stress.
Despite what others will tell you, if you’re struggling to grasp it all, you’re doing great.
Everyone’s learning this together.
Go try your hand at yield farming, mining Helium, or slinging NFTs.
The greater risk here would be to not learn about this stuff.
From the desk of Steve Strazza @sstrazza
Welcome to our latest RPP Report, where we publish return tables for various asset classes and categories, along with commentary on each.
Looking at the past helps put the future into context. In this post, we review the absolute and relative trends at play and preview some of the things we’re watching to profit in the weeks and months ahead.
We consider this our weekly state of the union address, as we break down and reiterate both our tactical and structural outlook on various asset classes and discuss the most important themes and developments currently playing out in markets all around the world.
In our RPP Report from the end of August, we discussed how the weakest areas were registering failed breakdowns and digging in at support.
In our most recent report, we focused on how the strongest areas were making fresh record highs. Things were looking up for the bulls… but that changed once again.
We’ve talked about how it’s been a back and forth battle with neither buyers nor sellers making any material progress for months now. And that’s exactly what we’re continuing to see, as bears have regained control again, pushing the major indexes lower for five straight sessions coming into this week.
For this reason, we thought a mid-week edition of the RPP would be appropriate to give us time to see what kind of follow-through would occur following the recent selloff.
In this week’s report, we’re going to talk about this near-term weakness but also some positive developments, like the healthy expansion in participation for ex-US equities in recent weeks and months.
I’m working with a broken hand these days, so we’re also going to try and let the charts do most of the talking. Don’t worry, there are plenty out there that have something to say. Let’s look at some now.
We’re not really expecting much more than tumbleweeds and a few winners here and there while Bitcoin’s stuck below the upper-end of this range near 47,500. But if we see a breakout above that level, we’ll be deploying some more cash into new long positions.It looks like we could be getting a resolution this morning, with Bitcoin trading back into the 47,000’s. For those with a shorter timeframe, the bias is higher above 47,500 toward the former crash highs of 53,000: Otherwise, if this breakout fails to hold, expect more messy action in the coming days. Of course, these are near-term developments. But even when we zoom out, this is still a major level of interest. When we were buying around the lows of 30,000, the next destination on our journey were those former lows that marked Bitcoin’s last defense before the crash earlier in the year. It’s no coincidence we’ve seen some chop and churn at this level. But the approach now is that if buyers have absorbed all this selling pressure and Bitcoin’s above 46,000, we need to be aggressively long with a target of those former first-half highs of 65,000. From an asset allocation perspective, adding additional Bitcoin exposure relative to the Altcoins makes sense here too, with Bitcoin at a logical level to take on a leadership role in the near-term. And note that isn’t a bearish development. We don’t need altcoins to outperform for the asset class to make new highs. Bitcoin’s lead crypto higher many times before (we wrote a post on this exact dilemma, which you can read here). [Read more…]
In yesterday’s note, we outlined that this looks very much like a “wait and see” week, with Bitcoin still in this messy sideways range.
44,000 is a big level of interest that the market respected, with prices trading back above our long-term macro risk level of 46,000 this morning.
But we’re not really expecting much more than tumbleweeds and a few winners here and there while Bitcoin’s stuck below the upper-end of this range near 47,500.
But if we see a breakout above that level, we’ll be deploying some more cash into new long positions.
If there has been any alpha anywhere in this market, it’s been in Crypto.
We don’t care where the trends are. We just want to participate in them. They can be in Stocks, Energy, Metals, Euro, Crypto, doesn’t matter.
I stopped caring a long time ago.
This is the video recording of our September 10, 2021, All Star Charts Crypto Weekly Strategy Session.