Bloody XRP Shining BTC
This report is not meant as financial advice and please do your own research and take responsibility for your own trades. This report is meant to update you regarding the markets so that you can make informed decisions.
NOTE: The following article is more for advanced crypto traders. If you are a beginner check out my beginner series here.
Hey guys, hope you’re having a great Christmas as I did. Have been busy with life and not keeping up with markets as intensively as before. Thus doing some coverage of some key events this week for you guys to update your portfolios for 2021.
New ATH for BTC.
BTC has hit $28,000 just this morning. Congrats to people who bought at $3,700 this year when I told them.
This is not so surprising as the US stimulus package is coming and USD continues to devalue. Although it has been delayed by Trump to edit which group of citizens gets more relief, the bill is expected to be 900 billion that the US treasury plans to print from thin air. At this rate, the USD is following the devaluation curve of the German mark which Germany printed to cover their war expenses after the world war.
This is why ATH for BTC is not surprising at all. Especially 20% of all new USD has been printed this year. This drastically accelerated BTC’s price rise which was expected to come next year to this year.
Sources are that many small or mid-size companies have also started loading BTC.
Few anticipated such a relentless rally, time and time again, BTC has thrown technical analysis out the window LOL.
There were large withdrawals out of exchanges due to demand rising from both retail and institutions that I’ve covered previously. Large amounts of money eating up the limited supply, so much that when miners attempted to do their usual quarterly dump to buy back lower later, it didn't work.
Some points to note is that it is the holidays now and most of the institutional desks and CME exchange ( the biggest futures exchange) are closed, so with little ease, whales can push BTC up through almost empty books. We can assume once these desks and CME come back from holidays, we will fill that void down at the pre-holiday pump prices at around $24,000.
The recent BTC pump has also made BTC trending on both Twitter and Google. Searches for Bitcoin has also reached the yearly highs although it has not breached its ATH searches in 2017. This means that this is just the start of the rally and it is not the top yet.
It's definitely not the best time to FOMO into BTC like many retail people are doing now. If you’re interested to add, wait for a pullback which will eventually come(trust me). But do not wait for 30–40% pullback we have previously seen the last cycle as the markets is now filled with matured investors from the traditional space and we will be lucky if we even see a 20% pullback.
With funding rates ( rates people pay to stay in leverage BTC long positions) so high, fear and greed index at 93/100 and many normies flooding in, a correction should happen. Don’t get me wrong, I’m not bearish, we’re still going for $100,000 next year but overleverage longs and weak hands need to be cleansed for us to go up.
I’m leaning towards the green arrows scenario happening, which will allow alts to catch up as well as some overleverage longs and weak hands to get flushed out. The purple scenario will be the MAX pain scenario which we have seen happen previously, but low probability IMO due to large amounts of new money soaking up the selling supply.
NOTE: The price might continue going up to $30,000( red arrow) before the correction happens, thus do not sell your entire spot bag as you’ll miss gains and FOMO back later. If you plan to sell, sell a portion and don’t buy back until a sea of red day(where everything dips including alts and BTC).
The key news of the week is XRP’s SEC case.
It got targeted by SEC and many exchanges started to delist XRP, this caused a large wave of FUD for people to start selling XRP. Shorting XRP was free money at that point.
Ripple might be able to pay a fine and life goes back to normal like how EOS solved it previously. It will also slowly be delisted by all exchanges as none of the exchanges has the resources to manage securities on their platform. This has already started and many exchanges have started to delist XRP, causing its price to plunge from 56 cents to 21 cents in a matter of days.
The key take away from the case why Ripple is getting hit so hard compared to EOS is:
- They were clear market manipulation by the team, they have market makers pumping the price each time they have good news.
- They sourced for funds from USA investors.
- They sourced funds from the public without any KYC.
- The token has zero utility and not used in the system at all.
- No customers are adopting their platform.
- They have large amounts of XRP that has been minted for themselves and have been dumping on investors for the past few years.(check tweet above)
I do not see XRP ending up well, EOS who got away from SEC not only a great impact on its price, this the bad publicity associated with it had also prevented many developers from building on it as well as many investors to refrain from buying into it. This will no doubt happen to XRP, especially with the lacklustre fundamentals. Thus, I’m not touching XRP at all.
BTC and Ethereum have also be declared by SEC to be not a security and thus very safe. I see LINK, YFI, RUNE and AAVE to be safe as well as their tokens have actual utility in the ecosystem, unlike XRP. However, many of the projects did a loose KYC like LINK and might be under scrutiny. YFI was also distributed to early farmers and thus not sold for profits and does not qualify as a security. I’m currently still holding them as I believe they are not securities but do your own research and know the risk you’ll be taking if you buy them.
What about alts?
Altcoins are down due to XRP fud. Alot of alts holder are capitulating into BTC as Newbies think all other altcoins might be securities as well but that is not true. XRP has zero utility and their customers are not even using their product and thus is a security. Not the case for ETH & LINK and many alts I called to buy as they have actual utility in the use of their respective network.
This is similar to the BTC India and China FUD in 2017 when they attempted to ban BTC. This period will pass and alts will recover. So hodl and don’t worry.
I was a bit early in buying bags of alts but I’ll still be hodling them into 2021, this is as although it might look really bad for Alts, such times are usually the best time to start buying your altcoin positions before they fly.
“The time to buy is when there’s blood in the streets, even if they are your own.” ~Baron Rothschild
This is a good time to cycle BTC gains into alts as alt/BTC pair are super low now.
This is similar to me calling to buy BTC at $3,700 during the March covid flash crash and that was one of the best trades of my life. Many altcoins are still heavily undervalued especially defi gems I’ve been picking like LINK, YFI, ETH, RUNE and AAVE.
The targets for the coins are below:
BTC: $100k- $250k(3.57x from current prices)
ETH: $3000-$5000 (4.76x from current prices)
LINK: $100-$200 (9.17x from current prices)
YFI: $250k -$500k (11.35x from current prices)
RUNE: $7 -$10 (7x from current prices)
AAVE: $500-$700 (6x from current prices)
It has been an eventful year, BTC reaching ATH, AMPL rebase coins season, yield farming craze, PayPal and institution FOMO, all in a single year. Everything looks to align BTC for its path to $100,000 and for Defi to have another bubble next year. Just DCA monthly into Alts and BTC and be ready for a wild ride next year.
Stack sats, alts and chill. Q1 2021 will be glorious.
That’s all for now, do hit me up in the comments or on Twitter if you have any heart-burning questions. Please share this with your friends if you find it useful.
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