🧘‍♂️What Just Happened

Market Meditations | April 2, 2021

So many profit opportunities and high probability plays. 

Dear Meditators

We’ve seen explosive price action today. 

✅ There are so many profit opportunities and high probability plays

Here’s our FULL analysis.

Read, enjoy and share with your network. Let’s all build wealth together.


MARKET BRIEFING

  • Crypto. Today, in the latest series of ‘the slow grind back to All Time Highs’, Bitcoin briefly hit $60,000. The recent sustained higher levels seemed to have dulled out fears during a ‘flash crash’ earlier this week. Speaking of highs, Ether (the largest altcoin by market capitalisation) touched $2,000 for the first time since February 2020. More on price action below ?

  • Legacy. First Friday of every month is U.S. Non Farm Payrolls or NFPs (essentially a labour market report). It was revealed that the U.S. economy created the most jobs in 7 months in March. Likely consequence of more Americans getting vaccinated and the government giving out additional pandemic relief money. Some suggest this could mark the start of the strongest economic performance in decades.


Delighted to say this article is brought to you by FTX. A cryptocurrency exchange for traders, by traders. Make sure to use my link to get a discount ?

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MARKET MEDITATION 

ETHEREUM / DOLLAR

One Day

With our key resistance at $1935 broken, Ethereum looks ready to run. Our first target is $2500, we expect to see a bullish April.

On top of the bullish technicals, Ethereum has benefited from a fundamentals boost courtesy of Mark Cuban. This is particularly impactful given Cuban was previously bearish crypto, stating he would rather hold ‘bananas’ than hold bitcoin ?

Cuban compared Ethereum’s smart contracts to the internet boom of the late 1990s. He even revealed that his portfolio is: 60% BTC, 30% ETH and 10% Others. We don’t have any more detail on the ‘Others’ at the moment but, some people are predicting it to be DOGE given his recent forecast of DOGE hitting $1.


?Developments in the coinbase IPO have caught our attention. According to a Coinbase blog yesterday, the U.S. Securities and Exchange Commission has declared the crypto exchange’s S-1 registration for a public offering effective. Coinbase’s Class A common stock is expected to trade on the NASDAQ Global Select Market under the ticker symbol ‘COIN’ on April 14

? Here are a few exchange tokens that we are keeping a close eye on. Mainly because we deem them to be the highest probability plays.


1️⃣BNB / DOLLAR

One Day

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BNB has already started it’s move. Synergistic with the “$ETH killer” and the “exchange token” narrative it’s primed to continue moving with our first upside target at $400.

Dips will provide great entries with our preferred level at $325.

$300 provides a clear invalidation level being a key psychological level.


2️⃣FTT / DOLLAR

One Day

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While everyone is focused on BNB, FTT is slowly following. FTX just bought a stadium and fits perfectly into the current exchange token hype.

Our upside target remains $50 and it remains within our buy accumulation zone. Given recent movements on Ethereum, the risk on the set up is now reduced and the opportunity remains nearly as lucrative.

?$31.60 acts as an invalidator to our bullish bias.


MINING NEWS & ANALYSIS

Bitcoin Mining Difficulty Hits Record High

Bitcoin’s mining difficulty has posted a moderately large increase to set a new high after months of relatively slower growth. 

Difficulty refers to the relative measure of the amount of resources required to mine bitcoin. This measurement climbs or falls depending on the amount of power consumed (or “hashrate” produced) by the network at a given time.

“Today’s moderately large difficulty increase is not surprising, and I expect it’s only a taste of what will come later in this year and into 2022, as delayed machine shipments start arriving and being deployed. The pending flood of hashrate about to enter the market will only continue pushing bitcoin’s mining difficulty higher, which should track with bitcoin’s price,” – Compass mining CEO Whit Gibbs told CoinDesk. 

Those involved in mining can expect Bitcoin’s difficulty and hashrate to increase but so too will the reward. To look at the other side of the coin: miner’s revenues also hit a $1.5 billion record in the month of March.


PERSONAL FINANCE

How to Think Like Aristotle and Elon Musk

Aristotle is known as one of the greatest thinkers in history however no matter what problem he was looking to solve his starting point remained constant. This starting point was the first basis from which a thing is known” or as we will refer to it, first principles.

First principle thinking is the act of breaking down our thoughts to their roots, challenging these roots and then rebuilding our thinking back up from scratch. Elon Musks compares this to a tree his advice being, “make sure you understand the fundamental principles, i.e. the trunk and big branches, before you get to the leaves (details) or there is nothing from them to hang onto.

To apply this practically when working on a problem:

  1. Identify your assumptions. Write down everything you think you know to be true about the problem. This helps us be deliberate and often reveals gaps in our knowledge.

  2. Deconstruct these assumptions into their fundamental principles. Break down each of your assumptions to their most basic building blocks. You will then understand the individual components behind each of your assumptions.

  3. Challenge these building blocks. Ask yourself, why do I believe in these building blocks and do I have evidence to prove that they are true? You will likely realise you were working based on information that was not correct in the first place.

  4. Build from the ground up. Re-evaluate your problem. Now that you have tested and improved your core understanding you will be able to find innovative solutions.

In trading and personal finance, it is easy to think we understand everything when in reality we often do not. Question your assumptions, build up your foundational building blocks of knowledge and like Aristotle and Musk, you will be able to find original solutions that will help you build wealth.


PODCAST

Lessons from History’s Greatest Traders with Koroush AK

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In this episode, we breakdown lessons from some of the best traders in history to provide actionable insights that you can apply to your own trading.

Key Takeaways:

  1. Set clear goals.
    In order for your goals to be meaningful, they must be measurable. Think about what you want from life and set tangible goals accordingly.

  2. Risk management is essential.
    Surprisingly, many of the world’s greatest traders defined risk management as their edge. Highlighting the importance of prioritising capital preservation. Do this and compounding will take care of your upside.

  3. Always consider time.
    Specifically, the opportunity cost of time: the idea that your capital could be put to work in another trade or investment. Also, the implications of time: how long can a certain price action continue before it invalidates your trade.

  4. Sometimes the best way to maintain profitability is not to trade at all.
    If the market keeps invalidating your system, take the time to rethink your strategy or wait until market conditions are more suitable. You don’t always need a position. 

  5. Never risk too much capital on one trade.
    When trading with a small portfolio relative to your net worth it can be beneficial to use a high risk, high reward strategy. When this portfolio increases as a percentage of your net worth transition out of these aggressive strategies.

  6. Always make your own decisions.
    Consistency is impossible to achieve when copying someone else’s system or signals. Develop your own system and you will have the convictions to follow your plan.


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Disclaimer: The content in this newsletter is for informational purposes only. Nothing in this email is intended to serve as financial advice. We are not financial advisors. Every investment and trading move involves risk. Do your own research when making a decision.