Market Outlook - 15/07/2021

 Introduction

It has been a really non impressive quiet week in the Bitcoin market as volatility continues to seep out, and prices squeeze into a tight consolidation ranges with low volume. It is starting to feel like the calm before the storm as muted and quiet activity appears across both spot, derivative, and on-chain metrics. This week we will explore a broad range of metrics and indicators across the entire Bitcoin market to establish overall sentiment, volatility triggers, and models for investor behavior.

Below we can see a summary of the BTC on chain  data:

• BTC Active Address: 819,200, up 0.34%
• BTC On-Chain TX Vol: 375,200 BTC, down 9.19%
• On-Chain Transactions: 231,800, up 5.84%

Note: The situation on BTC seems to slightly improve. 

Macro Outlook

It looks like there is an on going hash-rate recovery, that may suggest that offline miners have successfully relocated or re-established their hardware, recovering costs and likely reducing the risk of treasury liquidation sell-pressure. Also slow hash-rate recovery may suggest the converse, where costs and outage continues to take a financial toll, and thus increases the risk of treasury sales [1]. 

This week, the hash-rate has recovered from the peak-trough decline of 55%, to around a 39% decline. Should this level hold and be representative, it would indicate that hash-power equivalent to around ~29% of the affected hash-power has come back online [1].

Below we can see the hash-rate charts (all time chart):

Note: Near the end of the chart we can see the BTC all time slow recovery. 

Below we can see the hash-rate charts (monthly chart):

Note: Near the end of the chart we can see the BTC monthly recovery. 

Below we can see the addresses holding more than 10K of BTC (two week chart):

Note: This chart movement indicates nothing more then consolidation for BTC. 

Below we can see the annual NUPL chart of BTC (annual chart):

Note: This annual NUPL chart shows that BTC is still healthy and looks good.  Net Unrealized Profit/Loss (NUPL) is the difference between Relative Unrealized Profit and Relative Unrealized Loss. This metric can also be calculated by subtracting realized cap from market cap, and dividing the result by the market cap.

Below we can see the annual aSOPR chart of BTC (annual chart):

Note: The Spent Output Profit Ratio (SOPR) is computed by dividing the realized value (in USD) divided by the value at creation (USD) of a spent output. Or simply: price sold / price paid. This metric was created by Renato Shirakashi. The adjusted SOPR is SOPR ignoring all outputs with a lifespan of less than 1 hour. aSOPR is used to identify the local and global tops and bottoms (e.g. weekly and annual tops and bottoms etc.). The chart shows BTC got "reset", and that potentially indicates the Bull trend violently interrupted, in one small Bear trend and potentially a second Bull trend (aka. the Bull run was split on to two Bull trends).

Below we can see the annual aSOPR chart against the BTC price:

Note: In this chart we can see how aSOPR maps tops and bottoms.

Below we can see the addresses holding more than 10K against the BTC price (daily chart):

Note: This chart is showing the addresses holding more than 10K against the BTC price and I am also marking the entry of Elon Musk. We can clearly see the Elon Musk bought at 32-33k, and that is the end point of the accumulation phase and the start of the distribution phase (also known to Wycoff distribution). For more information see this post and this post. I made a mistake in the second post about the entry of Elon Musk. Elon Musk entered at 32-33k as already stated, not 35k.

Micro Outlook

Key theme throughout, the whole, 2020 and Q1 2021 was the relentless depletion of exchange coin reserves, with many of them en route to the Grayscale GBTC Trust, or accumulated by institutions. Now we see the outflow again increasing (an Bullish indicator).

Below we can see the exchange net-flow charts (six month chart):

Note: The inflow movement decreased, with max inflow during May 2021.

Below we can see the exchange net-flow charts (two week chart):

Note: The inflow movement decreased, even more the last two. This potentially indicate a BTC upward movement.

Below we can see the BTC mempool charts (one month chart):

Note: The mempool chart , verifies the low BTC volume for the last month. Again this chart movement  too indicates nothing more then consolidation for BTC. 

Conclusion

Technically speaking I see more consolidation on the BTC price. Nothing much has changed since the last post. It looks like there is going to be some big move.

Below we can see the USDT distribution in top 1% addresses chart against the BTC price (daily chart):

Note: The reason I am showing that is because, it means that someone is deploying USDT for future purchases. It does look reasonable since the Wycoff distribution is finished and we are now in a face of a Wycoff re-accumulation phase. It seems someone is on vacation.  

References: 

• insights.glassnode.com [1]
  

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]

Market Outlook - 27/05/2021

 Introduction 

In this blog post we will see what is happening on the BTC charts and end up with some conclusions about further price action. It seems that BTC is going to consolidate for the next couple of weeks. There is an accumulation zone created by the whales between 35k and 42k. Dont forget that Elon bought at 35k and therefore it is not going to go below that (whales never lose money). 

Elon's tweets that were partially responsible for the dump range from claims of negative externalities from energy consumption,  to claims that 10x faster and larger blocks on Dogecoin are a viable alternative. Unfortunately, this has lead to widespread confusion in markets, although for many Bitcoin HODLers, this is just another day in the office.

Below we can see the percentage in entities in profit from March 2020:

Note: The states say it all.

BTC Microscopic Outlook

Below we can see the 4hr BTC chart:

Note:  ABove we can see that BTC is rejecting mini head and shoulder reversal pattern. 

Below we can see the same chart with some resistance and support lines:

Note: Above we can see that there is a drop on the volume, which can be an indecator that BTC is going to continue consolidating. Also in a MACD we get a potential reversal, but in RSI is not clear.

Below we can see the 1d BTC chart:

Note: Above we can see that on the daily chart we are still bearish.

Below we can see the 1d BTC chart:

Note: We can see now that BTC a moving range of 12% (meaning consolidating in -+12% range, were we can trade). Also is below the 21 EMA , which seems to act as some king of strong resistance. If BTC breaks the 21 EMA thet we would expect a significant upward movement. 

BTC Macroscopic Outlook

Below we can see that the BTC NUPL is reset for good and that the BTC price and reserve is also droping together, which make it easy to understand that the price drop was purely manipulated.

Below we can see the NUPL from Glassnode:

Note: As we can see there has been a very good reset in the BTC NUPL chart. What does that mean is that the BTC bull run broke into 2x mini Bull runs and a mini Bear market, which will suppress the annual global top.

Below we can see the aSOPR from Glassnode:

Note: Above we can see that 35k might actually be the global (annual) bottom. We can also see from the chart that this deep could not be predicted by the aSOPR at all (aSOPR usually gives you a notification from 7 to 2 days earlier). BTC DIP WAS COMPLETELY UNNATURAL, THE BTC FUNDAMENTALS DID NOT CHANGE AT ALL AND THE DUMP IS NOT JUSTIFIED. 

Below we can see the BTC reserves:

Note: Again the macros did not change at all.

Below we can see the BTC netflow:

Note: Above we can see that the inflow increased dramatically to push the price lower.

Conclusion

We hit the bottom:

Note: We can see her the volume level is similar.

References:

• insights glassnode [1]
  

Market Outlook - 21/04/2021

 Introduction 

In this blog post we are going to analysis ETH short term (grab the money and run), and what trades to open on ETH [1]. ETH reached all time high (ATH) at 2500 something, this price could be predicted with fb entrancement.

 

See below:

 

Note: This chart shows the Fibonacci retrenchment hitting the psychological resistance close to  2500 dollars. ETH also has a significant de-coupling after January 2021 (about 9%), due to the fees and some other issues. It seems that ETH is going to retest very soon the 2500 dollar resistance pretty soon.

ETH TA

Below we can see that ETH formed a reverse double bottom:

Note: Set your limit sell order to 2300 something, as 2500 is a psychological resistance. A 10x on 2370 is safe enough. ETH seems to create a pennant after the 2279 dollar resistance. Also the latest 4hr resistance can act as a support.

ETH every time it is testing the EMA ribbon bonces back up: 

Note: ETH today is moving above the EMA ribbon and has successfully completed a ribbon bonce. 

UPDATE (22/04/2021)

We can see now that on the 1hr chart ETH created a channel:

And on 1day chart the ETH FBR is targeting the 4159dollars: 

References:

• www.newsbtc.com  [1] 

Market Outlook - 14/04/2021

 Introduction 

This article is going to focus on a few coins and run a basic analysis for opening trades. Below I am listing some interesting coins that look promising for short term trading.

Bitcoin

Below we can see the 4hr Tradingview chart:

Note:  BTC seems is going to consolidate the next couple of weeks.

Below we can see the day Tradingview chart:

Note: We can see that BTC volume drops, MACD and RSI show a minor trend cool down. My speculation is that BTC will go side ways for the next couple of weeks, unless something big happens.

Below we can see the Glassnode BTC Exchange 2 week NETflow:

Note: The inflow seem to to increase, which conform a BTC consolidation. 

Below we can see the Glassnode BTC Exchange 2 week reserve:

Note: It looks like the downtrend will continue, which is good as a macroscopic indecator.

Zilliqua (ZIL)

Below we can see the 4hr Tradingview chart:

Note: Volume reduced , RSI and MACD shows a reversal.

Below we can see the day Tradingview chart:

Note: Volume reduced , RSI and MACD shows a reversal. Strong support at 0.14677 dollars.

Uniswap (UNI)

Below we can see the 4hr Tradingview chart:

Note: It looks like Uniswap is preparing to make a significant move in the next days. Uniswap is forming a pennant! and volume pattern supports that.

Below we can see clearly the pattern:

Note:   In technical analysis, a pennant is a type of continuation pattern formed when there is a large movement in a token, known as the flagpole, followed by a consolidation period with converging trend lines—the pennant—followed by a breakout movement in the same direction as the initial large movement, which represents the second half of the flagpole.

Below we can see the day Tradingview chart:

Note: This chart confirms the imminent upwards move. This is a even now a good entry point. 

Below we can see the Glassnode Uniswap Exchange 2 week NETflow:

Note: It seems that Uniswap exchanges outflow are about to increase.

Below we can see the Glassnode Uniswap Exchange 2 week reserve:

Note: It seems that Uniswap exchanges balance is dropping  and this info combined with the Unipig (Uniswap v3 upgrade) update is going to give a boost to the coin. This chart confirms the upwards move for UNI too!!

Binance Coin (BNB)

Below we can see the day Tradingview chart:

Note: This chart demonstrates that BNB is now in a price discovery move after hitting ATH. Just bare in mind that BNB has a 90% plus correlation with BTC, even though it is a utility coin and a fork of ETH  Binance proved that can and will deliver (compared to ETH). Also this combined with the staking options provided and the burning features makes is a good candidate for hitting 1000 dollars by end of year if not more!!! Bare in mind that BNB Market Cap hit $88,350,515,767 and 100b is a psychological level..... 

Below we can see the Glassnode BNB Exchange 2 week NETflow:

Note: The exchange netflow shows that it might be an inflow on the immediate future , if this continues will affect negatively the price. 

Below we can see the Glassnode BNB Exchange 1 month reserve:

Note: This chart shows that the BNB reserves for the last month increased and this might actually have an negative impact on the price, that might cause BNB to consolidate.

LoopringCoin (LRC)

Below we can see the day Tradingview chart:

Note: LRC looks good baby. LRC is using zkRollup and is an Exchange and Payment Protocol. Loopring protocol can settle up to 2,025 trades per second while guaranteeing the same level of security as the underlying Ethereum blockchain. This is made possible by using a construction called zkRollup, which aggregates and executes transactions off-chain, in a provably correct manner. This is also a layer 2 solution that competes with ETH FYI. The longer the ETH waits for the upgrades, the longer LRC is going to boost. Both oscillators show an uptrend. 

Below we can see the Glassnode Loopring Exchange 2w Netflow:

Note: Whales seem to withdraw from Loopring and this is good for the price.

Below we can see the Glassnode Loopring Exchange 1 month reserve:

Note: Reserve goes up and might not be good.

Matic Network or Polygon (MATIC)

Below we can see the day Tradingview chart:

Note: Matic, another layer 2 solution solving the congestion problem with ETH seems to do good, although my view point is that it is going to consolidate for while , untill see some big move.

Below we can see the Glassnode Loopring Exchange 1m Netflow:

Note: This chart shows as the MATIC is either going to wither consolidate for while or even drop its price. 

Below we can see the Glassnode MATIC Exchange 1 month reserve:

Note: The monthly MATIC reserve drops and this is good as a microeconomics indicator.  Although in the short term I would not wait for a significant move. It seems that MATIC is in an accumulation phase right now.

Below we can see the Glassnode MATIC staking 1 month chart:

Note: Microscopically speaking the chart above shows that whales and retail are moving their MATIC out of staking and into the exchanges, which designates some serious price action move. Meaning that people either move to other altcoins or actively trade MATIC. This smells accumulation!!!