Market Liquidity Grabbing Before the Next Leg Down.

24.08.2023

Dear traders,

The market is currently exhibiting a gradual upward movement and a liquidity grab, possibly setting new short targets.

Jake
TOP Trader

BTC is undergoing a retest of the $26,500 resistance. If this level is breached, the next liquidity pool is anticipated around $27,200. However, the upcoming move might involve a fake-out before a larger subsequent movement.

ETH is trading above the $1,630 support and is consolidating before its next push. Caution is advised, as it remains vulnerable to downward pressure before the next leg.

XRP has pushed the price above the $0.5 support and must maintain this level before the next leg. Nevertheless, the risk of further downward pressure persists.

LINK is still holding above $6 and consolidating. Despite waning momentum, any price below $7 presents a favorable buying opportunity.

SOL is attempting to break the $22 resistance and move higher. Consider purchasing options when it’s priced below $20.

EOS is still struggling with the $0.6 resistance and is currently trading below it. Breaking the $0.6 mark is crucial for the next upward push. It remains an attractive option for long-term investment.

LTC is losing momentum and is currently trading at $65, indicating a slowdown. There is a significant risk of a more substantial downward push.

The DXY is breaking above 103.5, showing breakout momentum.

Crypto/stock daily news:

THE STATE OF CRYPTO

Let’s talk about the state of crypto.

But instead of sending a long, boring PDF, we’re gonna give you the rundown using 4 charts – all in under 2 minutes.

We make our industry snapshots like Cup Noodles – quick, easy, and convenient.

Alright, let’s dive in.

1/ BITCOIN IS HAVING AN INTERNAL BATTLE

Bitcoin is going through a civil war right now. It’s the Battle of 2 Investors.

On one side: short-term BTC holders (aka they’ve held BTC for less than 155 days)

On the other side: long-term BTC holders (aka they’ve held BTC for more than 155 days)

Both groups are facing very different situations.

Most long-term holders are in the green on their investments. As a result, they’ve been accumulating more and more BTC.

In contrast, most short-term holders are in the red on their investments. According to Glassnode, ~88.3% of short-term holders are underwater after last week’s flash crash.

As a result, short-term holders have been selling this past week.

Overall, this is a bearish sign for Bitcoin in the near term.

You see, short-term investors are a lot like teenagers going on their first date – they get nervous, sweaty and are more likely to panic when something goes wrong.

So if prices keep decreasing, we could see more short-term investors sell-off which could push the price of BTC lower.

We’ll be keeping a close eye on this trend as we head into September – which has historically been the worst-performing month for BTC. *gulp*

2/ ETHEREUM IS MIGRATING

ETH (pronounced “eeeeth”) is the second largest cryptocurrency with a $197B+ market cap.

And there’s one big trend happening…

ETH is moving off exchanges. Over the last 5 months, the total ETH on exchanges has dropped from 29M → 22M.

This is good for a few reasons:

Less ETH on exchanges = less likely chance of a sell-off.

More users are staking ETH (there is currently 24M ETH staked vs. 22M ETH on exchanges)

Users are moving off exchanges to explore the Ethereum ecosystem – like Layer 2s, lending protocols, etc

Overall, these are bullish signs for ETH in the long term.

More staked ETH + more ETH moving away from exchanges = less available supply and more buying pressure.

3/ THE LAYER 2 WAR IS HEATING UP

Layer 2s have been growing in popularity over the last few months. The top ones have been Arbitrum and Optimism.

Well, there’s a new fighter: Base.

It’s Coinbase’s new Layer 2 blockchain and although it’s only been live for ~2 weeks, Base has more daily transactions than Arbitrum and Optimism.

Here are the stats from yesterday alone:

Base: 723k transactions

Abritrum: 643k transactions

Optimism: 450k transactions

The majority of Base’s volume is coming from Friend.Tech (crypto’s new favorite app) so it’ll be interesting to see if the new Layer 2 can keep up the lead in the near term.

Either way, Base is making a strong case for Crypto’s Rookie of the Year. (Let the Onchain Summer celebrations continue.)

4/ NFTS ARE DOWN, BAD

There’s no sugarcoating it: NFTs are in the sh*tter.

Over the last 6 months, the market cap for major projects is down ~$2.2B. (ouch)

This includes popular projects like Bored Apes, CryptoPunks, Azuki, DeGods, and more.

FAST NEWS:
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Coinbase has acquired a minority stake in Circle – the issuer of the USDC stablecoin. The Centre Consortium (which governed USDC) is being shut down and USDC will also be integrated into 6 new blockchains.

Balancer announced a vulnerability that puts $27M worth of crypto in its pools at risk. The team added the vulnerability had not been exploited (yet) and said that 80% of the issue had been mitigated, but some funds were still at risk. Users have withdrawn $100M from the protocol since the news broke.

Former OpenSea executive gets 3 months in prison for insider trading. Nate Chastain was found guilty on charges of buying/selling NFTs he knew would later be featured on OpenSea’s website. (My researchers tell me jpeg trading doesn’t get you much street rep in prison either)

Sam Bankman-Fried pleaded “not guilty” to fraud and money laundering charges. His lawyers also argued that he’s living off bread, water, and peanut butter due to the lack of vegan options in prison. (They call it an “inadequate diet”, but back in college that was the Meal of Champions™)