All Star Charts Crypto Articles

There's no hiding the fact that we've had little to discuss in the way of tactical trading opportunities.

To avoid repeating ourselves, we're continuing our patient approach. You can read yesterday's note or last week's for more detail.

Speaking anecdotally, crypto traders specifically seem incredibly susceptible to a subconscious bias that they always have to be positioned. Everyone's trying to bottom-tick the market to fuel their ego.

It's a rookie's mistake, and the reality is far from the truth.

Maintaining the ability to sit out is not only a necessity in markets like these, but I'd argue should be the default option for traders.

The old saying is that there's only a handful of periods every year to make money. You're being patient for the rest of the year, waiting for the setup to form.

This perfectly encompasses our approach.

In last week's letter, Keeping Out of the Waters, we continued to argue the case for neutrality in the near term.

There's been so little to discuss in the way of actionable trade ideas in this messy, choppy environment. Assessing the price action over the weekend, it seems this patient approach has paid off.

We were stopped out of our starter Bitcoin $BTC long and a few positions in crypto-associated equities at a small loss. As Bitcoin hit our stop in the upper 20,000s, we sold any exposure we had and moved straight back into cash.

Following this volatility, we are not interested in calling a bottom.

Patience has been and continues to be the strategy in this tape.

This is the video recording of our June 10, 2022, All Star Charts Crypto Weekly Strategy Session.

It's no secret that long-duration assets have been hit the hardest in this bear market, with interest rates on the rise.

Think about growth stocks and the tech junk that peaked in February 2021 -- it's been a painful bleed lower ever since.

But, in recent weeks, even the worst stocks have stopped going down.

And, what's more, they're finding footing at notable levels of interest, whether it's their pre-pandemic highs, their pandemic lows, or their 2018 lows.

Yesterday, we explained our neutral bias over short time frames. With elevated futures leverage, we continue to anticipate whipsaw-like price action.

Last night we saw this manifest, with Bitcoin $BTC sharply selling off, giving traders yet another failed breakout signal.

This was the first strong selling we've seen in Asian hours for a while. As it stands, this is not a friendly tape for short-term directional trading.

As we said yesterday, this appears to be a “fade the breakouts” type of environment.

We also discussed the following altcoin index chart, noting that alts haven't provided a strong buy signal over short time frames.

The index is still below key support, on an absolute basis and, more importantly, relative to Bitcoin.

So, in today's post, we want to be overly obnoxious in arguing for patience.

It boils down to a few key themes:

• There's little to no directional conviction over short time frames.
...

Crypto markets appear to be stabilizing in the aftermath of the Terra $LUNA crash, with Bitcoin $BTC slowly progressing to the low 30,000s. Many altcoins are pressing down on critical support levels.

As we'll cover in tomorrow's note, many are well-defined for long-taking opportunities if the conditions arise.

But looks can often be deceiving.

We're still placing a high weighting that near-term price action will involve a high concentration of whipsaws. This appears to be a "fade the breakouts" type of environment.

This is all taking place within the context of Bitcoin resting on macro support of around 30,000.

All in all, we have a neutral bias for the weeks ahead. But, zooming out, this would be a logical area to see Bitcoin and the others bounce over longer time frames.

This is the video recording of our June 3, 2022, All Star Charts Crypto Weekly Strategy Session.

From the desk of Louis Sykes @haumicharts

The beauty of trading and analyzing crypto is the level of transparency of the data.

This is put on full display when it comes to the sprouting industry of on-chain analytics, but the same principles apply when evaluating money flow as a collective.

Not only does crypto host its own exclusive metrics that aren't available in traditional markets, but traditional indicators like the topic of today's post often have additional nuances involved.

This enables us to gain even more insight than what is possible in other asset classes.

Today, we wanted to explore how we use open interest in our crypto process to supplement our traditional technical analysis research.

It's that time again -- monthly candlesticks!

Longtime readers know how much we love new monthly candlesticks. They force us to zoom out from the day-to-day noise and focus on what's really taking place.

In the case of Bitcoin $BTC, it can't get any more defined than 30,000.

Remember this time last summer when we were obnoxious about this level every week?

There's no denying that the market action over the last month has been hectic.

From the collapse of Terra $LUNA to the crash in governance tokens, not to mention the macro headwinds that have played their role in crypto markets.

With all this noise, let's zoom out and focus on how we're viewing the current situation.

This is the video recording of our May 27, 2022, All Star Charts Crypto Weekly Strategy Session.

From the desk of Louis Sykes @haumicharts

In yesterday's note, we made a brief argument for caution.

Today, I want to add some further context and discuss one of the difficulties involved with trading in a tape as messy as this.