Market Outlook - 28/06/2021 (Bitcoin Situation Part2)

 Introduction 

This blog post is going to focus on the current situation on Bitcoin and answer the following question IS THE BITCOIN BULL RUN FINISHED? First we are going to focus on the in chain data, then the charts  then the fundamentals and then I am going to give you me conclusion. But the first question to you is, do you think the market is heavily manipulated?

The On Chain Data  

First lets look the Mempool movement (2 weeks):

Note: I think the difference is obvious to naked eye.

First lets look the Bitcoin: Number of Addresses with Balance ≥ 10k compared to price (2 weeks):

Note: I think the difference is obvious to naked eye, again what is happening here. Did you open your long position at the 28 to 30k??

Now lets look the Price of BTC in USD vs. Bitcoin Mean Hash Rate (2 weeks):

Note: I think the hash rate did not affect the price of BTC (meaning the Chinese miner shutdown).

Now lets look the Net Unrealized Profit/Loss NUPL vs. Bitcoin Price in USD for one month:

Note: Looks that all weak hands are shaken out.

Now lets look the Net Unrealized Profit/Loss NUPL vs. Bitcoin Price in USD for one month from Tradingview:

Note: Looks how closely the NUPL follows the price. And here we can see some promising signs of reversal. The RSI and MACD is configured for the NUPL.

The Off Chain Data  

Below we can see the daily chart and see how beautiful the Wyckoff was setup:

Note: Interesting setup.
 

Below we can see the weekly chart  and see how global bottoms are related to volume:

Note: Also the volume in each bottom is increasing.

Conclusion

My take on the current situation is that BTC hit bottom. As the time is passing by it is becoming more and more difficult to manipulate BTC and there fore that is why they are using Doge and Shiba coins to get their FIX. I think this is the begging of the new bull run.

Market Outlook - 13/06/2021 (Bitcoin Situation)

Introduction

 

The Bitcoin market has seen a relatively quiet week, both in price action, and in demand for on-chain transactions and value settlement. Prices have traded within a narrow range between a high of $39K, and down to a weekly low of $34K. Meanwhile, on-chain activity in active users, settled volume and transaction fees, across both the Bitcoin and Ethereum protocols, have fallen back to levels observed in 2020 and early 2021. Mempool congestion has largely cleared as the market remains uncertain around the bullish or bearish bias of the current market structure.

 

 

The On-Chain Data (Mempool)

 

The time has come to look into  the block chain data to be able to end up with our conclusions. An important element of crypto is the Mempool. The Mempool tends to become very active during Bull Market periods and usually cools down when the Bear prevail. The Mempool is a “waiting area” for Bitcoin transactions that each full node maintains for itself. After a transaction is verified by a node, it waits inside the Mempool until it’s picked up by a Bitcoin miner and inserted into a block [1].

 

Below we can see the 1m BTC Mempool transactions [1]:

 

 

Below we can see the 6m BTC Mempool transactions [1]:  

Below we can see the 6m ETH Mempool transactions [2]: 

 

Below we can see the 2w ETH Mempool transactions [2]: 

 

 

 

RETAIL, HIGH NET WORTH PEOPLE AND WHALES MOVE TO DIFFERENT TYPE OF ASSETS SUCH AS ETF ETC.  

 

The On-Chain Data (Hash Rate)

Another interesting indicator to look into, would be the Bitcoin hash rate. Bitcoin hash rate (also hashrate) is the computer power of the Bitcoin network. It is the measurable and quantifiable speed at which the Bitcoin network processes data when adding new transactions to the shared ledger [3]. Again during Bull market the hashrate is increasing and during Bear markets the hashrate is reduced.

Below we can see the hashrate charts:

Note: Above we can see how the hashrate is related to the BTC price.

Below we can see the aSOPR against the BTC price and RSI/MACD:

 

 Note: It looks like we hot rock bottom, as far as I am concerned.

 

The Conclusion

My IMO on the current situation is that the BTC is going to move between 35 to 42K for 2 to 6 months.

 

Below we can see the BTC dominance chart:

 

Note: There is a support line at 38. Which I think it will hold for now. Both RSI and MACD show a down trend, show time to accumulate more BTC.

 

Below we can see the BTC price against the NUPL chart:

 

 

Note: Still looks healthy.
 

 

References:

• 99bitcoins.com [1] 
• jochen-hoenicke.de [2] 
• medium.com [3] 

 

 

 

The Narratives & the Atlcoin Market

Introduction  

The Altcoin market works with narratives. But what is a narrative and why this is important? Well below we can see the definition of narrative:

Definition of narrative

• something that is narrated : STORY, ACCOUNT
• the representation in art of an event or story

In the context of cryptocurrency a narrative is a theme used to describe the functionality the currency is adding, developing.

Definition of narrative in the context of cryptocurrency

• the technological them used to describe the problem that the currency is used to solve 

Matic's is layer two Ethereum solution using side chain for performance reasons

The Market & The Narratives

Narrative is important because it help the retail and institutional investors to decide if the narrative of a currency is going to pick up in the near future e.g. the narrative describes a problem that requires solution. If the fundamentals are good and the narrative is popular then bingo.

Below we can see a schematic representation: 

The narratives that came up in this bull market are the following:

Below we can see the definitions on some of the narratives: 

Optimistic Rollups 

Optimistic Rollups (ORs) are one type of layer 2 constructions that do not run on Ethereum's base layer but on top of it. This enables running smart contracts at scale while still being secured by Ethereum. These constructions resemble Plasma, but trade the almost infinite scalability of Plasma to run an EVM compatible Virtual Machine called OVM (Optimistic Virtual Machine) which enables ORs to run anything Ethereum can.

Plasma

Plasma is a layer-2 scaling solution that was originally proposed by Joseph Poon and Vitalik Buterin in their paper Plasma: Scalable Autonomous Smart Contracts. It is a framework for building scalable applications.

ZK-Rollups

ZK-Rollups are one of the options being developed for layer 2 construction that increases scalability through mass transfer processing rolled into a single transaction.  

NFTs

An NFT is a digital asset that represents real-world objects like art, music, in-game items and videos. They are bought and sold online, frequently with cryptocurrency, and they are generally encoded with the same underlying software as many cryptos.

DEX

A decentralised exchange (or DEX) is a peer-to-peer marketplace where transactions occur directly between crypto traders. DEXs fulfill one of crypto’s core possibilities: fostering financial transactions that aren’t officiated by banks, brokers, or any other intermediary. Many popular DEXs, like Uniswap and Sushiwap, run on the Ethereum blockchain.

As the market started evolving we started seeing combinations of the narratives:

Popular narratives

Popular narratives are the narratives that solve a problem e.g. Ethereum is a network with high fess and scalability issues and therefore the popular narratives are the ones that help us drop the fees and increase the Ethereum network.

Narratives of the future 

The narratives of the future are the narratives that emerge in order to solve new problems or optimise the solutions that currently exist even more. A few examples can be seen below: 

How can you profit?

Simply find old or new narratives with good fundamentals and start buying.......

SOMETHING SMELL LIKE CLEAN ENERGY...... 

References:

•  docs.ethhub.io [1]

Market Outlook - 04/06/2021 (Bitcoin Situation)

Introduction 

This post hopefully is going to remove some of your FUD and help you understand what is going on in the market right now. I am going to explain some basic principles of the market and dive into my view backed with FACTS and it will all make sense. A lot of YouTube and Twitter influencers keep on saying that BTC is dropping because Elon is posting his ridiculous twitter posts WRONG, this might help the drop of BTC but is not the main reason. 

The Basics    

Market prices are affected by various facts. The market is mainly driven by supply and demand (small supply usually creates demand and vise versa). In crypto we have more visibility, on what is happening,  due to the on chain data. Stock and crypto prices are determined in the marketplace, where seller supply meets buyer demand. 

Below we can see how FUD and FOMO are triggered:

FUD and FOMO are triggered by information. Information that is 90% manipulated and controlled by the Whales. 

That is correct Whales have:

• Resources
• More capital
• Control of the media 

Retail investors control nothing, ONLY THEIR EMOTIONS TO NOT BUY AND HOLD OR TO SELL THE RIGHT TIME. 

The Facts

What are the facts, the facts are that whales do not care about your financial freedom, but they care for making profit.

Below we can see the 7 day number of Addresses with Balance ≥ 0.01 (this is the retail):

Note: As we can see this is dropping relatively slow.

Below we can see the 7 day number of Addresses with Balance ≥ 0.1 (this is still the retail):

Note: As we can see again this is dropping relatively fast.

Below we can see the 7 day number of Addresses with Balance ≥ 1 (this is still the retail):

Note: As we can see again again this is dropping relatively fast (same curve as above).

Below we can see the 7 day number of Addresses with Balance ≥ 10 (this is not retail):

Note: As we can see curve is changing as the the number of addresses is fluctuating, and is not a straight line dropping.  

Below we can see the 7 day number of Addresses with Balance ≥ 100 (this is not, obviously retail):

Note: As we can see the trend is changing slowly.

Below we can see the 7 day number of Addresses with Balance ≥ 1k (this is big whales):

Note: As we can see here is were the manipulation takes place. The wales sell and buy BTC in order to maintain the price close to 35k.

Below we can see a schematic representation of the address movement:

Note: When the addresses move up and down BTC will consolidate. Whales are currently on vacation or waiting for the next accumulation cycle.

What is OTC

Over-the-counter (OTC) refers to the process of how securities and Bitcoin are traded via a broker-dealer network as opposed to on a centralised exchange. Over-the-counter trading can involve equities, debt instruments, and derivatives, which are financial contracts that derive their value from an underlying asset such as a commodity.

In simple words OTC does not affect the BTC price. Below we can see the OTC/CEX buy history ration for a whale:

<<< Whales accumulate only through OTC and Retail investors only through CEXs.>>>

Accumulation Phase

When did them accumulation started? 8th of Feb see below:

Note: We can see above that the addresses picked on 8th if Feb and we reached ATH on 22nd of Feb. And the addresses started droping gradually, until now. 

This means that when a second accumulation starts the BTC price will start increasing again. When accumulations start and stop?? Well it depends on how BTC is used. Recently companies started including BTC in their balance sheets for cash replacement. This means that important company dates related to a company profitability are important for the BTC accumulation start and stop dates.

The following events will help us assess the start of the new accumulation:

• Company earnings announcements
• Can be annual or every 4 months
• Company dividend announcements
• Can be annual or every 4 months
• Company tax returns (near the end of the year)

An earnings announcement is an official public statement of a company's profitability for a specific period, typically a quarter or a year. An earnings announcement occurs on a specific date during earnings season and is preceded by earnings estimates issued by equity analysts. If a company has been profitable leading up to the announcement, its share price will usually increase up to and slightly after the information is released. Because earnings announcements can have such a prominent effect on the market, they are often considered when predicting the next day's open [1].

Below we can see the TESLA earning announcements:

Note: We can see that TESLA earning announcement were reported on Q21 aka April 2021 and TESLA bought at 35K BEFORE THE ANNOUNCEMENTS. TESLA STOCKS WERE NOT AFFECTED BY THE BTC DROP. BTC LOST NO MONEY (ON PAPER FOR BUYING BTC). TESLA BOUGHT BTC IN THE CURRENT PRICE AND THE PRICE DID NOT DROP FOR A LONG PERIOD OF TIME BELOW 35K. ON Q2 2021 TESLA MIGHT SO PROFITS FROM OTHER RESOURCES/INCOMES. IT DOES NOT MEAN BTC WILL INCREASE ON Q3 FOR TESLA COMPANY, BUT THE COMPANY WILL LOOK GOOD IF BTC PRICE IS CLOSE TO 4OK BY END OF Q2 2021.

Below we can see when Elon started FUDing about BTC:

Below we can see when TESLA bought and what happened afterwards:

I leave the conclusions to you guys......

BTC market is increasing and therefore, it gets harder to manipulate. Also the BTC returns will minimise as time is passing by....................

References:

•  investopedia.com [1]
• Tesla Info [2]