Touch Grass

This post is now closed. Final results were:

Trades (cumulative return of +28.5%)
1. ENA short from $0.57 to $0.53 (+70% on 10x lev)
2. VIRTUAL short from $1.19 to $1.17 (+8% on 5x lev)
3. Pair Trade Long ETH/Short VIRTUAL (-30%)

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8 August Update

Ethereum is the holder of the strongest recovery, so below I present to you an analysis that makes it easy to take action in all cases.

Ethereum has been ranging between $3,580 and $3,895 for over two weeks now. At the moment we can see it having broken out from that range from which it can get to $4,100 with relative ease. But of course, nothing is that straightforward in markets and caveats must be added:

1. Given the breakout and retest you want to see no 4H closure under 3895, as long as that remains respected then 4100 will happen.
2. A breakdown under 3895 would mean this was a fakeout and we head back to mid-range around 3720.

Simple and straightforward. Thank you for your attention to this matter.

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Original Post

This post will be dedicated to August seasonality and our ongoing expectations of the month. Please remember that views are dynamic and they can change as new data comes to light.

July Recap

Last month was one where Ethereum really shined, and I traded it even though I am usually an investor. The reason I did was because I saw that small and mid caps were unlikely to yield any result while Ethereum was full of opportunities. Ended up placing 5 trades (4 wins, 1 loss). Ended up being a great month honestly. Just over 5x’d my trading account.

I did hold expectations of an upside sweep before downside, and while it sort of materialized ($3,940) it did not get to my $4,100-$4,400 targets. I still believe we see those later on this year, and higher, but for now in the short-term, I expect chop (boring ranging).

Every time Bitcoin and Ethereum range, we constantly see Altcoins bleed a lot, so two things emerge for me:

1. I need to sell LAUNCHCOIN, AERO and MPLX, because they are small/mid caps and I don’t think they do well. I will look to re-enter in a few weeks.
2. If Bitcoin does chop, smaller tokens will bleed, so why not short them?

August Seasonality

Generally, August is the worst month for Bitcoin. The reasoning usually is that liquidity is low and fund managers are in St Tropez. Obviously there are exceptions (2013, 2017, 2020, 2021) so take this data with a grain of salt.

The data I take more seriously is Bitcoin’s price.

If we were to objectively look at things, we would see that Bitcoin has been trading in a range. Every time it would move up in price, altcoins stay alive (most barely move) and when it goes down to range lows, altcoins die.

There are two scenarios, either Bitcoin goes back into the range and we get a small relief rally across the board, or it continues its way down to $112,000. In both cases it is small movements on Bitcoin itself.

I personally lean towards a range reclaim, some upside movement and higher prices to short from for weak altcoins.

The only thing that would absolutely change my mind is if Bitcoin breaks out (from the upside) of the range, then I’d be full bull in the short-term. But the reason I do not think so is because of Michael Saylor’s announcement yesterday (TLDR of it is we now need to figure out how to replace $600-700m of weekly buy pressure into Bitcoin).

Ethereum

If Bitcoin’s range reclaim materializes, Ethereum might head back to $3,710+ and one could look for a short on it into ~$3,400 on a failed breakout. It would look something like this.

Note that it remains too early to tell, I would need more price data to have more certainty. But anyway I do not plan on shorting Ethereum, I will go for weaker altcoins.

Weaker Altcoins

I am still watching, but as of today three tickers that I am interested in are: VIRTUAL, HYPE and ENA. I will wait a few days for entries to materialize (will update in here of course). If I don’t get higher prices to short from I won’t short. Never chase a position.

I personally plan to do it on Hyperliquid. So will place a referral code you can use to get a fees discount: https://app.hyperliquid.xyz/join/THECLUB (sign up through here if you want to use it).

Bear Market?

Quite the contrary, this is just a small period of boredom. I still believe Altcoins see a trillion dollars added to them in value (refer to the “Acceleration” post) after the breakout. This is all just pre-breakout noise.

As a boring period I just plan to place a few trades of small size. No big risks will be taken this month.

FAQ

Q: Why is this post called “Touch Grass”?

A: Because in periods where nothing happens you should touch grass, spend time with your family and just enjoy life without the daunting feeling of markets taking over your life. The good times will come back, you must be refueled for them.

Q: If you think Altcoins will bleed, why not sell ICM tokens and LISTEN?

A: Because these are small positions by design. I always stressed on the importance of allocations. I can afford to see them go to zero (which I don’t think they will obviously, just making a point).

Q: You think LAUNCHCOIN will go down a lot?

A: Believe have a large treasury of over $30,000,000, the fact that they trade at just over 2x that is odd to me, but markets can remain irrational for a while. I am humble enough to say: I don’t know. But soon, I will as the market gives me more information. I just don’t need to stay in it before I find out.

Disclaimer: Nothing here is financial advice—just brain sparks from a random (but not your average) Instagram page.

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