Bloodgang,
Welcome to the twenty-ninth issue of Bloodgood’s notes. The idea of this newsletter is to give you an overview of the previous week’s fundamentals and what happened on charts as well as to remind you of this week’s articles, secret TA tips, and trading calls. Basically, it’s about giving you all the key info in one place.
Table of contents
- Fundamental overview
- Bitcoin and Ethereum chart
- Blood’s content recap
- Concluding notes
As this community grows, I have a duty to give back to all of you that helped me and supported me to become what I am. This free newsletter is just another way to share my experiences and prepare you for the journey that’s ahead of you.
Love,
Blood
Fundamental overview
Last week, the relief bounce came with full force – at least in US equities – with the S&P 500 putting in the biggest green weekly candle since November 2020. As I mentioned in the previous newsletter, this was to be expected given the technicals and sentiment over the past couple of weeks. This doesn’t mean that equities look good mid-term, but it’s simply a reflection of the fact that nothing goes straight up or straight down, and that relief bounces can provide great opportunities as well.
In crypto, there have been some new developments in terms of regulation and institutional adoption – most notably with Russia’s Ministry of Finance openly considering crypto for international payments and JPMorgan starting to use blockchain for collateral settlements – but the overall picture hasn’t changed too much. Still, an important testament to the extent of long-term commitment by smart money is the fact that Andreessen Horowitz announced a $4.5 billion fund for Web3 companies, which is the biggest crypto fund ever. In a time of overwhelmingly bearish sentiment, this is the perfect reminder that nothing has changed in the big picture. Things can look bad in the markets for months – or even years – but if something is capable of radically changing many aspects of our lives for the better, then it’s just a matter of time before it reaches its full potential.
Bitcoin
Bitcoin/Dollar Daily chart
Bitcoin/Dollar H4 chart
Bitcoin defends the range.
After another boring week of Bitcoin trading inside the range, daily candles closing lower each day, volume lowering and Stochastic RSI being ready to exit the overbought area we had “breakdown” signs all over the place. However, it seems that this was a bear trap as Bitcoin pushed higher during the weekend and is up over 10% from last week’s low.
Not much has changed structure-wise, the zone around $28,500 is support and $31,500-$32,000 is resistance. Daily Stoch RSI has been in the overbought zone for about a week which could lead to a short-term retrace, however, $28,500 must hold. The weekly is not showing any changes, the 9th consecutive red weekly candle was printed, again under the key $32,000 level, indicating further downside.
However, I decided to talk about the H4 chart today as it shows signs of bullish price action, like the 100 MA that was lost at the beginning of April and rejected numerous times until now. Bitcoin broke above the MA and pushed towards $31,000, but keep in mind that the Stoch RSI is in the overbought zone and bulls could be exhausted soon. The H4 stoch will need to reset, which could lead to a retest of the MA100, and in order to keep bullish momentum, bulls must defend this level.
The plan is simple, don’t FOMO into this move, wait for the retest of the MA100 (if we get it) and upon confirmed retest, position accordingly with a tight stop loss. If we don’t get a retest and get a green rocket right through resistance ($31,500-$32,000), that would be even better, but I doubt it.
Ethereum
Ethereum/Dollar Daily chart
Ethereum/Bitcoin Daily chart
Ethereum takes a hard hit as alts underperform Bitcoin.
Tough week for alts as some dropped over 10%, compared to Bitcoin, which only dropped for 2% on the day of the crash. However, in hindsight that presented a good dip buying opportunity as today most alts reclaimed pre-dip levels.
Looking at the ETH/USD pair, we can see that Ether has pumped straight into the key level which has to be reclaimed in order to keep in touch with Bitcoin. The upcoming Ropsten testnet merge should be around June 8th which could trigger some bullish price action in the coming week. Stochastic RSI has bounced off the 20 level, showing that there is still room to grow.
On the other side, ETH/BTC looks terrible as it smashes through the key weekly level all the way to 0.06 BTC which seems to be holding for now. I am expecting ETH to outperform BTC in the next couple of weeks, but nothing is for certain so I will keep actively monitoring these levels.
My plan is simple here, if the 0.06 BTC level is not defended, I will focus solely on trading Bitcoin. For now the level seems to be defended, and the levels we look at are clear.
Blood’s content recap
Blood Trading league
Tomorrow we are ending the BTL beta testing. Thank you everyone that joined and i hope you enjoyed & learned something.
The official launch of BTL will be when the Bloodgood platform launches.
Yes, you heard right. Bloodgood platform is coming.
Stay tuned and join the community, its free!
https://discord.com/invite/bloodgang
Relief rally in June?
“I am convinced that we will see a relief rally in the beginning of June.
More companies are adopting Bitcoin; Balenciaga, Gamestop, Japanese banks etc.
We just closed the 8th red weekly candle on Bitcoin and June is a green month according to Bitcoin Historical returns.
Ready?”
Concluding notes
In spite of the bleak macro picture, at least it seems that the market is recovering from the havoc caused by the Luna collapse. The airdrop of the new LUNA token already happened, with LUNA and UST holders (both pre-crash and post-crash) receiving an allocation of the new token, while the old chain was renamed to Terra Classic (ticker LUNC). So far, it seems that this will hardly change anything for those that were overexposed to LUNA or UST and didn’t get out at the first sign of trouble, and the question of how much interest Luna can attract without 20% APY remains very much open. However, many other alts have been giving some attractive relief bounces recently, so I hope you make the most of these opportunities – but don’t get too attached to any positions in this kind of a market.
