Welcome to the seventeenth 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.
Another news-driven week is behind us, with no shortage of weird price action to empty the pockets of everyone trying to enter swing trades at this unstable time. The Ukraine conflict is still in full swing and, with stagflation becoming the new global buzzword, it’s no surprise the markets have been in risk-off mode. Equities haven’t been looking great, while oil and gold have continued to make headlines with impressive highs.
This is a complex environment – stagflation isn’t just a scary word – and the markets will continue to be largely driven by geopolitical and macroeconomic news. For those that are new to macro stuff, what you need to know is that stagflation is a combination of stagnating growth and inflation, which is quite the double whammy. Typically, inflation and stagnation are opposite market forces, with measures that reduce inflation causing stagnation and vice versa. When both of these happen at the same time (for example when inflation is partly driven by a supply shock, as is the case now with oil prices), trying to solve one problem tends to make the other one much, much worse. With that in mind, keep your eyes on the headlines and don’t get too confident – in either direction.
Bitcoin/Dollar Weekly chart
Bitcoin/Dollar Daily chart
Bitcoin casually pumps and dumps by 21%, leaving crypto traders in disbelief.
At the time of writing, BTC is trading at $38k, again dropping below the $40k level for the third time since late January. After making a higher low on February 24th many believed this was it and we are finally breaking above the $44,500 zone which seems to be too hard a nut to crack for Bitcoin. We have tested that area for the fourth time now and got heavily rejected, giving us golden short entries.
To be honest, I expected the $40k level to last longer this time however due to low weekend liquidity it went through pretty smoothly, reversing the whole 20% pump that occurred on the monthly close.
Looking at the weekly level, Bitcoin again failed to reclaim above the key level and got heavily rejected, closing in the May range once again. On the bright side, the weekly stoch RSI has broken above the 20 level and the chart painted an inverted hammer candle, indicating that buying power is slowly returning.
On the daily timeframe, I am closely monitoring the price action as it is of key importance that we make another higher low if we want to see a continuation. If we break below the previous low, then in my opinion, the $32k-$30k level is in play where I have already spread bids since a few weeks ago.
Ethereum/Dollar Daily chart
Ethereum/Bitcoin Daily chart
Ethereum is slowly losing strength against Bitcoin, however, a bullish pattern occurred.
As discussed in the previous newsletter, ETH/BTC indeed approached the 0.065 level and it is currently hovering above it, while continuously making higher lows, indicating there could be a breakdown below the key level.
Looking at the ETH/USD chart, the $3000 resistance was tested once again, but immediately rejected. Moreover, we have a clear downtrend, forming higher lows, however similar to Bitcoin we also had 2 higher lows, forming a symmetrical triangle which is a bullish continuation pattern.
I will not be looking to trade Etheruem unless we reclaim the crucial level above $3000 and I will be monitoring the ETH/BTC pair for any sign of strength.
Blood’s content recap
“Swing Trading masterclass
The easiest and least time-Consuming strategies you Have to follow.
This proprietary article will explain exactly How to trade without any Stress and be in Profit.
Read it, and share it if you find it useful.”
“Some people become very impatient once their position is on profit.
They want to cash out immediately.
The same people become super patient when they’re at loss.
They wait for a “reversal”. This must be the other way around.
Let your profits grow, and limit your losses”
Macro bitcoin ranges update
“Price action is respecting accumulation zone we draw few weeks ago.
Macro perspective is still bullish until Bitcoin makes a lower low (currently unlikely scenario)”
Bitcoin macro ranges
Apart from geopolitical and macroeconomic events, there’s been one noteworthy headline in the crypto space: Andre Cronje, the founder of Yearn that some have dubbed “the Godfather of DeFi,” has announced that he’s leaving the crypto space for good. While some tokens crashed drastically following the news, some of this is likely an overreaction, since it included protocols to which he hasn’t been actively contributing for over a year. Still, powerful figures are extremely important in DeFi – as in any other new and rapidly growing domain – so this impact wasn’t that unexpected.
Overall, this pales in comparison to the current political events happening on a global scale, so make sure to stay up to date with those and not get carried away on any low timeframe price action. With huge new headlines about everything from central bank sanctions to the mass realization that, in a fiat system, the government can just decide to freeze your funds whenever they want, the financial landscape of the future will be shaped in this turbulent time.