Are Altcoins Breaking Down? Will BTC Follow the Same Path?

16.08.2023

Dear traders,

Altcoins are experiencing significant drops, and the next major supports are the significant support lines. The question is, will they hold?

Jake
TOP Trader

BTC is still holding at its last support of $29,100, but the possibility of the next leg down remains high. It’s still in danger before the continuation of the next bearish trend.

ETH is breaking below $1,830, which marks the breakdown line. There’s a strong possibility of a more substantial drop in the coming days.

XRP is experiencing a sharp drop below $0.6, with the next significant support at $0.54, which needs to hold for the longer term.

LINK is dropping from its $7 support, with the next major support at $6.45. While it’s losing momentum, any price below $7 is a good spot for buying.

SOL is losing momentum and is currently trading at $23. It needs to hold above this level for a bigger push upward.

EOS is breaking below the strong support at $0.7 and is now approaching the $0.662 support, which needs to hold for the longer term. It continues to be an appealing option for long-term buying.

LTC has hit support at $78, which should hold for a larger upward movement. While new lows are possible, it remains a favorable option for long-term buying.

The DXY is undergoing a robust surge, breaking through the resistance level at 103. Currently, it’s attempting to breach the 200MA on the 1D chart.

Crypto/stock daily news:

MICHAEL BURRY’S NEW BET

Today, we’re gonna talk about… Michael Burry’s new market bet.

Now in case you don’t know who Michael Burry is, he’s “The Big Short” guy. (and no – he isn’t big, or short)

He famously:

Predicted the housing crash in 2007

Heavily shorting the market before it crashed, and made millions

Got his own movie (called The Big Short)

Some people think he’s a market oracle.

Other people think he’s like that guy who still brags about his high school touchdowns, 20 years later.

Well yesterday, all the fanboys and haters were talking about Burry’s new bet.

The Bet: Michael Burry is shorting the market (aka betting against it) and bought $1.6B in put options.

It was all over media headlines and sent investors into a frenzy.

Well, the Trader Jake decided to do some research and had some interesting findings. Let’s dive in…

MYTH #1: Michael Burry bought $1.6B in put options.

OUR FINDINGS: False.

The $1.6B is the notional value of the shares associated with the put options. NOT the real market value.

Notional value = the total value of assets in a leveraged position. It’s more of a theoretical value.

Market value = the actual value of those assets right now on the market.

So although Burry did place a bet shorting the markets, it wasn’t a $1.6B bet. It was much much lower.

Side Note: Some are estimating Michael Burry paid $100K-$1M for the positions, while others are estimating it was $10M-$50M. Who knows for sure.

MYTH #2: Michael Burry just placed the bet.

OUR FINDINGS: False.

While most headlines reported this was ? BREAKING NEWS ?, the reality is that these were Michael Burry’s holdings as of June 30th.

46 days ago. (Which in the investment world is like…)

The Truth: All of this info is based on the earnings report from Burry’s company, Scion Asset Management, from last quarter.

So it’s unclear whether Burry still holds those positions or has sold them off since.

MYTH #3: If Burry’s prediction is right and the stock market crashes, so will the crypto market.

OUR FINDINGS: False.

“If stocks pump, crypto jumps. If stocks bleed, so do we.”

This is a well-known nursery rhyme in crypto. And it’s been sung from market cycle to market cycle.

Well, times are changing. And right now, it looks like Bitcoin’s correlation with traditional assets (i.e. stock market, gold, and oil) is almost non-existent.