🧘♂️When, Not If
Market Meditations | August 20, 2021
Your 5 minute crypto, $BTC, $ETH and $SOL update
The purpose of our newsletter is to add value to the crypto community. It’s why we are here. That’s why we love to see our technical analysis play out as we expected. And there’s plenty more where that came from…
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Let’s zoom in then out.
From a short-medium term perspective, there’s no denying that we’re in an uptrend.
Currently, we’re experiencing the second retest of the $44.8k level.
On this bounce, ideally we’d like to break the local top around $47.5k and head towards the $50k level. The $49.9k level is the key resistance.
Zooming out now.
Remember, the macrostructure is still a downtrend. We’ve had a big move down and a big retracement towards the 0.618 level. For our macro bias to shift, we’d want to reclaim the 0.618 level. Thereafter, we are looking a lot more aggressively bullish.
If we don’t reclaim the local top, it’s possible the $44.8k support level will also break.
Earlier this week we were looking at an entry above the $2.9k level confluent with the 100 day moving average. Indeed, that’s what we saw happen. If you managed to get your entry filled, Congratulations!
Now, the key level we want to hold is $3.1k and the breakout level we want to watch is $3.3k.
Earlier this week, we also mentioned an entry into SOL at the 0.236 level. If you got in on both this level and the ETH entry, extremely well played. A nice 33% price increase from this level.
The level we want to hold is $61.9.
On the upside, we’re looking for a break of $77.3 (the local high).
A more aggressive opportunity for a breakout play at $80. Remember and repeat after me, trends overextend in crypto.
For accumulation, we would consider the $67 level. If you anticipate a bounce back up.
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SolPAD, Solana’s IDO (Initial DEX Offering) platform, may have experienced its first rug pull yesterday. If confirmed, this would qualify as the first rug pull on the Solana protocol. Only the second IDO on SolPAD, Luna Yield (LUNY) went live on August 16th. SolPAD issued a statement on Twitter early yesterday evening indicating the Luna Yield team had taken down their website and all social media accounts. An anonymous source reported over $6.7 million in assets were lost.
Rug pulls occur when developers abandon a project and abscond with funds. These bad actors lure unsuspecting users into investing in their listed token or coin, then withdraw the balance.
SolPAD continues to gather information by openly asking for assistance. A reward has also been offered for any information which leads to locating the Luna team.
In May of this year, $32 million was taken from investors in a project called DeFi100 on the Binance Smart Chain (BSC) in a similar move.
Though it cannot be certain that a rug-pull has been carried out, the evidence is rather convincing. When investing, the decision to accept some level of risk is inevitable but should be approached with the utmost caution. Smaller or lesser-known projects need to be heavily scrutinized to accurately assess risk to make an informed decision. Remember – never invest in any asset without knowing enough about it. Rug pullers prey on the uninformed. Though it can happen to anyone, mitigating risk is the name of the game, especially in crypto.
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? This Week In DeFi
It has been hard not to mention Gary Gensler in the newsletters lately, mainly because he can’t stop talking about the SEC regulating DeFi. Regulators aren’t the only ones with DeFi on the brain either, it is popping up on new chains, a new index and new balance sheets as well. DeFi could be the buzzword of the week.
Avalanche launches a $180 Million liquidity mining incentive with Curve & Aave protocols.
Bloomberg & Galaxy launched an index fund to track 9 defi protocols. The assets included will be Uniswap, Aave, Maker, Compound, Yearn and Sushi (plus three unnamed). Bloomberg’s index fund will provide institutional investors with exposure to the future of financial services (A rival Defi index was launched by Bitwise in February).
Coinbase announced it will not only include bitcoin on its balance sheet but will also dedicate $500 million to other crypto assets to include: Ethereum, Proof of Stake & Defi tokens, plus others. In addition, 10% of quarterly net income will be allocated to purchase crypto assets for their balance sheet.
Bifi claims to be the first decentralized exchange to support yield on real Bitcoin and not just pegged or wrapped Bitcoin.
With all this groundbreaking news in DeFi, it would be rare if we didn’t have any FUD to muddy the waters. For starters, crypto friendly Brian Quintenz, a commissioner for the Commodity Futures Trading Commission, has announced that his last day will be August 31. Under his lead the CFTC has not only been friendly to crypto, but also debated with the SEC as to how to qualify fraud in DeFi.
In an interview with the Wall Street Journal, Gensler hinted at going after the team of core developers. Maybe now we know why some project developers choose to remain anonymous!
Not financial or tax advice. 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. See our important security disclaimers here.
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