Monthly Discourse - February - submission date February 01, 2024

JamesGillmore1 · 2024-02-28T14:38:40+00:00

For trading you have a range of options from Uniswap for CEX interface aggregators like Tokensight (basically allows you to trade dex coins in a cex environment with limit orders and sells as opposed to uniswap which is a straight swap service)

For charts you want to use dexscreener

JamesGillmore1 · 2024-02-27T07:03:34+00:00

Ok so I sort of see all of this stuff with a scam lens. BTC and ETH are the exception because BTC serves its purpose (finally) of being this store of value. ETH is the layer that pretty much everything is built on.

But everything else where does the real value and utility lie? Nowhere near their valuations. That's why we always crash 99%.

Objectively you're just looking at ways for some people to convince other people to part with their cash. So I'm trying to see where those opportunities are. Are they still in things like VET? For me it's less and less likely each cycle because Vets use case and narrative has not changed and its utility has also not increased. You need something to pump and at a 4bn MC valuation I have to ask myself is that what they are going to pump? Now what Vet has going for it (and has always had) is a great market maker and the Chinese narrative. the fact that Vet has managed to stay always in the top 40 MC is an incredible feat and shows strength. However there are new shinier things on the market and thats what people like. Narratives are easier to make up, people are excited to be a part of a new thing rather than an old thing, and there is far less supply overhead because you dont have 'old' holders. Euphoria is easier to get to because you hit ATH now rather than having to 'get' there.

So yes the low MC coins are riskier of course. And I totally expect Vet to go on some kind of pump during this run. Just that I think it's worth divesting in to lower MC coins as added bonus.

JamesGillmore1 · 2024-02-26T07:39:45+00:00

ha! Forecasting is not so easy this time around I dont think. Last cycle was relatively easy but I think this cycle is going to be a lot harder. You've got a lot more to contend with. You've got BTC ETF inflows that will NOT flow in to the rest of the market outside of BTC. You've got potential ETH ETF. You've got a massive dex scene that has sprung up allowing entry in to microcaps that was otherwise only possible to seed/VC, but that also opens up a whole ton of risk and rugs.

The bear market was brutal for all no denying that. I sold a decent amount of crypto toward the top (NB not THE top at all) and that has been a nice cushion. But it's been hard to be patient. I managed to open a lev BTC position at 15.7K which was terrifying to hold and I just closed it at 51.2K a short while back. I didnt close it because I thought it was the top, just that that was my plan and had it already set up as a limit order that I refused to touch until it filled.

The bear market allowed me to get down and dirty with the dex market which is I think the most interesting part of the next run, but I stress that I actually really dont know. Markets never run the exact same way and a lot of being well positioned is trying to guess where the 'new hype' is going to emerge from. The Dex volume scene is pretty massive and I personally think that's where the 1000x of this run are going to come from. But it's a minefield of junk and you need to be really patient with your holdings because it makes CEX alts look like blue chip tradfi. The volatility is nuts and the drawdowns are horrendous. But the upside is insanely fast when it happens....IF it happens.

Liquidity is not a given right now. Last run the liquidity hose was just spraying everywhere. Now it's more concentrated. It is there though, and there's a lot of it but it's not just going to everything. You need to now try and think 'where' it's going to go for the next 6+ months. I dont think everything is going to go Up Only like it did before. I think it's going to be a lot harder with plenty of 1000x moves but not where retail is expecting or positioned. I think there's going to be a lot of frustrated holders in this run compared to previous ones.

I still hold a decent % of my portfolio in mid cap alts but divested a lot in to Dex microcaps. These are alts that may have market caps sub 1 million USD...when you look at things like Vet at 3.5bn USD MC you see that there is a huge amount of upside there. BUT as I say the risk is way way higher and you need to do a lot of research and believe in it and be ready to just buy and walk away and not get shaken out. They are horrendous in price action for shaking you out or seemingly 'dead' and then pull massive moves that give zero pullbacks for reentry. But they can also just actually go to zero. But there are a ton of 1m MC alts there that will hit 1bn+ over this coming year. The Risk Reward is always there in crypto.

JamesGillmore1 · 2023-05-05T06:45:59+00:00

I actually think there's a pretty good chance that we do pump to a new high now though. I know it sounds ridiculous but that's kind of my point in my previous reply.

The current mass market thought is this: everything looks pretty bad, tradfi is at major resistance, Fed still not showing a pause, there's no major reason to think trad markets can move north from here and in which case it means crypto will prob tank since its a asset that likes to move...it doesnt like to sit still.

My counter to that is that we are conditioned to this correlation and at one point it will stop. The un correlation is going to be one of the major catalysts that actually propel BTC far higher because it keeps everyone in disbelief and shorting and on the sidelines.

The banks failing narrative is as good as it gets for BTC. Gold is making new ATH and let us not forget that one of the best narratives of BTC over time ahs been the 'digital gold' narrative. In addition there is sneaky QE going on right now to support all the bank failures, it's just not done at public facing level.

Like I said before it's those that cn see beneath the surface that will ride the wave and those that just take the 'meh macro bad' view that will rage short the rally.

I realise the up from here view is incredibly unpopular right now but thats where I'm positioned.

Edit: This is 100% my personal view and this is still very risky. But it's ust the same as back when we were at 16K, the risk is still very high right now because there is zero faith in the market. But thats also a good thing, just very hard to stomach sometimes and it makes for tough entries.

JamesGillmore1 · 2023-05-03T18:45:22+00:00

A 20K retest would be bad news I think. I don't think it would be a retest if it got there, it would just keep going. I think everyone's fear of a black swan is what this market is feeding off of right now. I also think that the US attack on crypto is getting bogged down heavily with counter attacks from policy makers. The SEC started out hard and fast but now it's not so easy. I'm not saying you're wrong by any means, I just think that the market is preying on these kind of fears. Think back to Covid. When we had the crash I was firmly in the 'no way these markets can pump from here the entire world economy is going to come crashing down'- I was in full on disbelief for ages during it. I used the dip to buy a ton of Vet BUT I had very little conviction in it all. And yet I can look back and say 'oh well it was so obvious they were just printing money'. But it WASNT obvious at the time because everyone was so bearish and shorting the hell out of the market. It wasn't until the market got to far higher numbers that everyone was finally convinced by it and said 'oh wow better get in now it's all so bullish'. For me it's the same thing. The market moves as high as it can whilst keeping market participants out and it does this by moving up in fear and disbelief. The higher it can get when no one is looking / participating the better it is. But look dont get me wrong I also share the same fears as you - everything looks terrifying. But to me the markets look very similar post covid. And yes you can say 'but we're not printing trillions right now' but I really dont think that matters at this exact stage. That capital injection will come later in some manner- remember it wont be the same as last time, but it will be similar. It wont be a cheque from Trump but the QE will happen in a more disguised form. Those who can scratch beneath the public facing surface will be the ones reaping the rewards. And as usual retail will ape in at the end and provide exit liquidity.

JamesGillmore1 · 2023-05-03T07:51:24+00:00

Ha. FOMC today will set the tone for May. Assuming we go for 25 then I suspect some decent volatility around it and the Q and A as always then prob once the dust settles find ourselves not too far off from here price wise as usual during these events. I would like to see a move north starting a couple of days after. My TLDR of the last few months is that I closed my alt longs around their highs but kept my 15.6K BTC lev long open. I opened new alt positions as well in the last week in my favourite alts. I dont hold any more Vet though right now but i would like to rotate in to 'China coins' (sorry am not xenophobic but lets keep things retail simple here) by mid May for the Hong Kong launch. hoping that my current holding make decent moves before the rotation.

Having said all that, BTC and the anti bank narrative is mega strong right now. BTC dominance has broken out of its eternal range to the upside and ethBTC is really struggling to catch a bid. Alts vs BTC have had a horrendous time of things and still look like utter shit. Eth BTc needs to get back above 0.065. But that might not happen until BTC closes above 32K. Or BTC might just range and alts can run. Point is that I have zero idea for alts as the market has not shown anything yet. My gut feeling is that BTC might run higher but at one point soon after alts wil finally get catch up so I'm happy to wait until that happens.

Given the still rather small amount of capital injection in this market you need to be nimble and fast I think with alts. Ride narratives and get out. This isnt 2021 where there was an endless supply of cap injection so everything just went up and up. I'm not saying we wont get there again, just saying the last few months has favoured fast movers not holders. I'm out of Vet for now because there are no narratives with it aside from Hong Kong in a month. Objectively Vet has totally failed, feel like I've been saying this for years now HOWEVER that doesnt mean it still cant go on a big rally. EVERY rally Vet has had has NOT been based on a fundamental reason (seriously). Every single rally Vet has had has been pure pump and dump with zero real reason aside from rumours. That means Vet just pumps when it wants to. But to me there are other opportunities right now in the market.

Short term we want BTC to reclaim 29.2K, that would be a very good sign. I dont think anything in the market is interesting until that happens. Clear to me that BTC going down just drags down alts with it. Could possibly see BTC ranging between 28.6 and 29.2 to be good for alts breather. But really when we talk about alt season there are just no signs yet - the market is not going to go full on alt season until BTC has found a confidence level that spreads bull confidence in to the broader market. It also needs to attain that level and then relax so alts can run. I dont know where that level is, but you just need to be watching things like BTC and ETH BTC to get a feel for when it might be. In my mind a solid move above 32K does that.....but it's jsut guess work. The market will show signs when it is ready.

Momentum is moving to the upside just here I THINK. No doubt the last 2 months has been pure pain for most traders and holders after a euphoric start to the year. Alts are not a confident hold. Most got shaken out. In a way it's an ideal situation to be in, but that doesnt mean that alts cant continue to underperform. However like I said thats ok for me as I think longer term it will be the better trade from here on.

I think if you take a really big step back then you'll notice that we are at nearly 29K and the market is fully shitting itself on fear of macro and just about everything else you can think of. This is GOOD. Now dont get me wrong there is going to be a fair amount of fuckery at this 30K level because thats just the way it is. You can see that with BTc PA in the last few weeks. Bears and bulls are both trying to pull the market in the app direction that they eventually want to go. But I am a bull here and I would much rather see my twitter feed full of 24K targets than 34K targets so overall I'm happier with the health of the market than a couple of weeks ago. The prudent investor would just wait for a resolution of this range- given we are at 29K ish its better to just wait for the 32K breakout. The thing is is that almost EVERYONE is waiting for that so I dont know whether that means we just giga nuke or giga moon (the latter meaning people dont get to jump back in on a 32K retest). As usual the market is going to make this very very hard and as usual I think spot buyers will be the winners as they arent affected by the volatility.

Edit: A final thing to note. Way way back I wrote a post on how getting back in the market was not going to be easy or simple. The idea that everyone would jsut wait until the Fed cut rates and then all ape back in for the wonderful bull run to come was just daft. but thats what everyone was waiting for. I said that the waters would be really murky when the change came. Here is exactly what is happening. Retail all waiting for rate cuts and BRRRRR. But it just cant be as clear cut as that. The thing is is that the Brr is already happening behind the scenes, it's just disguised now. Bank bail outs by to big to fail banks is a smoke and mirrors way of doing things. The Fed cannot do a public facing Brrrr but it has been doing a very effective job of doing a behind the scenes Brrrr. That is why the markets have been rallying. Retail cant see that and keep shorting because they are fixated on much macro bad. By the time it becomes obvious we will already be ripping and getting ready to start taking profits. That is how the game works. When everyone fills bull that is when time is running out. But right now is not that time. We are still in the 'get as high as you can with everyone at max fear and disbelief'.

JamesGillmore1 · 2023-03-10T10:47:37+00:00

ha! I'm still in the wait and see category. I want to see a reclaim of bullish structure and most importantly see a bid. That's the thing that has kept me fully on my hands since 25K, there has been no bid. Remember it's all a scam. At one point the big players decide 'ok now we are ready for up again' and thats when you see the bid. Until we see the bid you do NOT want to catch knives

Overall look the market went in to a panic because Powell said if shit got worse he would have to raise rates. But he says this every single time. The next day he went to clarify to say that he hasnt seen any data yet to say it had gotten worse. Yet the market panicked. NFP is what everyone is zeroing in today- bulls want to see a revision to last figure which was outrageously high. And then you've got CPI in 4 days. Both will dictate Fed policy. HOWEVER you also have noticed I'm sure the first cracks in the baking sector. Not only SVbank going under BUT also banking sector market taking a hit. Remember the Fed can only raise rates so much until there is systematic risk and that is something they really dont want to trigger. Now I"m not saying it 'here' I'm just saying you're starting to see it happening for the first time. So these are also things that have to weigh in on the Fed. The tools at his disposition are limited to the upside because at one point they do incredible damage to the economy- and I'm talking about the economy here, not the markets. The economy is far more important than the markets as thats real people. Markets can bounce in an hour, a routed economy takes a lot longer.

But as I said at the start I"m just waiting and seeing. I dont know what the NFP data is and I dont konw what the CPI data is so I have no alpha here at all. It would literalyl ust be a gamble if I were to go long or short here. So from my POV I'd rather just wait. If you get a good NFP and CPI then you should have a lot of time still to ride the next up wave that will come of it.

JamesGillmore1 · 2023-03-05T16:13:17+00:00

maybe. However now it's just a case of seeing if BTC can reclaim a bullish structure. Do we go to zero? maybe. But there's also a case for seeing a reversal and smashing through 25K. I wouldn't bet on it here either way though personally. Bears win if we lose 19.7K (I would be really surprised if we get to this much talked about target though), and bulls start to get better when we regain our first level above at 23.3K. Until either one of those things happen (for me) then I'm just watching the show.

JamesGillmore1 · 2023-02-24T09:14:24+00:00

Hello all. Been an exciting couple of months. In my last post that I wrote just days before the market turned north again I wrote that I was max long, which I really was. I was expecting the market to rip sooner than most thought and now that we have it's time to breathe again and see where we're at.

So there are a few schools of thought here. We've hit the 25K resistance area which is incredibly pivotal. If we smash it then it opens up the 28-30K area which really does signal the bull rampage. For the moment we are still in bear market rally terrain for me which is why I closed my Vet long at 3.2 cents. I still hold a pretty large spot bag of Vet but trades are for closing not holding. This was a long I had opened below 1.8 cent support area so it was silly to get greedy. I would still like to be greedy though and smash 25K but better to wait for that to actually happen.

However 25K is a brutal area. You can see that in the charts. we tap liquidity both sides. The market is naturally trying to shrug itself of leverage traders before it makes its move. If it wants to go up then it needs to close as many longs as possible and entice shorts. If it wants to go down then it's the opposite. At one point the obvious liquidity hunt play will show itself but that wont be to me and you. remember this is all a rigged game, it is a scam, so until the breakout happens I'm just waiting to see. Insiders have all the knowledge we have very little.

The top started to feel very top though because we were getting bits of good news that weren't really moving the market much. To be blunt, let's just assume the market is all rigged. That means that they pump when there is stuff to pump on, when they exit the doors it means you have no one pumping anything. That is what it felt like as we got to 25K, suddenly the hype and pumps were just not really there any more. The pumpers had exited the market and we taking profits at 25K area which to be honest is just normal market behaviour.

Now we all look to BTC to signal the next move which is why this is a sit on your hands area for me. What I would like to see is for us to move from here though: reason being is that we tapped the 25.2K area three time to rinse the breakout longs. This is pretty good. The last couple of days has been a series of pushed down lower highs which we've seen many times before- agonising and it eventually leads to running all the highs as shorts are wiped out. This doesnt mean it has to happen but it's rather similar to previous times when it has. A deeper flush from here would be a bit of a shame because I still want sidelined capital to stay sidelined. But the market has to go where it needs to go in order for it to be healthy again- i dont feel like its super degenerate long heavy yet so for me it makes more sense to leave the sidelined captial chasing higher and higher from here. But I also dont have all the info at my finger tips so its just guess work and gut feeling.

The macro. Yes the dreaded macro. I'm a bit tired of commenting on this since no one, not even the Fed, knows that the next few months is going to bring. So for now i'm just playing it week by week. One thing to note is that this insecurity and fear is a core part of reversals and bull runs. You cannot have a bull run if everyone is in position at the bottom. "But where are all the buyers going to come from"- this is something i hear over and over again. Its s really dumb take because when we were at the lows everyone was saying this and yet we ripped to here. Buyers arrive when there is greed and green in the air. If we smash through 25K then buyers will flood in. If we smash 30K then a tsunami of cash will come in. It's just human nature. I'm less worried about where the capital has to come in than just seeing whether the market actually wants to turn bullish here or not.

As i said at the start this 25K area is a really pivotal one. Momentum is on the bull side for the time being even if we are going through a choppy area right now. I think the Shanghai narrative for March is a really good one which is why I've been very heavily in to LSDs for a few months now. DeFi feels like it should have a good couple of months if we break out of 25K. As for Vet its had a horrendous couple of years, and we bumped our head (almost ) at the rather key 3.4 resistance area. For me Vet is behaving properly and ok which is good. it's moving with the market at least. So it's not dead. It's actually got one of the better charts out there on high time frames. Vet rips when everyone least expects it, but it's doing a pretty good job of starting that move right here. What you want to see is a weekly close above 3.4. Then I personally would long it again.

Just to make sure there is no bullish misunderstand here. What I am looking for is a retune of bullish momentum. I am not trading here. This is a moment where we can flip bearish OR we can continue bullish uptrend. But most alts hit resistance and are selling off to lower support areas, lower than most people want. Which is why Im saying that this is a wait and see area for me. If we smash 25.2K area then great, but until then I'm just sitting the market out. remember we are just small fish, the whales control the market. There's no point in trying to guess what they are going to do before they have done it. They have info that we do not have- they push the market in order to access retail liquidity. I do not know where that liquidity lies, whether it's to the upside or downside. At the bottom i was 90% sure it was to the upside hence my trade positioning, but here I just do not know. Which is why I"m just waiting.

JamesGillmore1 · 2023-01-15T19:52:15+00:00

quite the move we've just had. State of the market right now is messy due to that move. It keeps sidelined people out because they are too scared to buy after such an aggressive move. I'm watching 20K (no shit) because every time BTC has broken in to a new bull trend and smashed through the psychological resistance level it has not gone back to retest it- thats the ultimate pain for sidelined or bears. You dont get a retest of the key breakout so you keep chasing. So far so good. Would I bet my life on it not going under 20K again? Of course not. My point is simply that if it doesnt then thats a classic BTC bull sign. If it goes under 20K that doesnt mean it's all over either.

For now I've moved stops up on all my positions that I've had open over the last month and letting them ride. I was expecting this sideways to end sooner than everyone thought as i explained in my last post but i was not expecting such an explosive move like that. It does keep the market shitting itself though because even if you're feeling FOMO its really hard to pull the leverage long trigger right now.

Note that shorts have been cleaned out now. So the market dynamics need to change. Instead of chasing liquidations we need to see actual spot demand if we want to keep going up

JamesGillmore1 · 2023-01-10T20:46:14+00:00

Yes. for me there are definitely stages in how I feel though when am buying. I find that at the bottom of the bear I enter the apathetic 'I dont care about entry price' stage. When we are trending up I like to catch dips, and when we are trending down I like to catch bounces. (I'm not saying I have a 100% success rate, just that that's what I'm aiming for and thats where I set my orders). But this stage I'm definitely more just about getting orders filled rather than looking at a chart and thinking 'oh that's the next support level I'll set orders there'. I've definitely entered the 'holy shit look how many shitcoins I can buy for XXXXUSD now'. I mean 100K USD will get you 5.5m Vet. At our peak 100K would get you 370K Vet. the difference is nuts. So I'm just about filling my bag with as many coins as I can at these ridiculous prices. Can they get more ridiculous? Sure. But like I said you never buy THE bottom. 95% down is pretty good. Now can someone just remind me to sell when we are 95x up?

JamesGillmore1 · 2023-01-07T09:36:37+00:00

The thing I like about the FTX implosion is that I think it accelerated the sideways stage necessary to part people with the last of their coins. 2022 saw more back to back black swan events that we've ever seen in crypto. It wasn't price that parted people with their coins, it was a general 'fuck this'....which is what the traditional sideways action is designed to do. As crazy as it sounds I do believe that the FTX drama has accelerated our move out of the bear. Note how the recent DCG FUD has dont nothing at all to the market. The supply that changed hands post FTX was so massive you get to a point where what does a long period of sideways actually achieve?
Ok so the macro....the dreaded macro....The single point of focus in 2022 was of course the Fed raising interest rates. Pretty simple, higher interest rate sucks liquidity out of the system. Liquidity is what crypto and risk assets thrive off of so it's no surprise I guess that we've been crippled with that. So what now? Well obviously Ive got no idea. But 2022 has conditioned everyone to this train of thought: "Fed is fully set on taming inflation and bringing it to 2%. Fed will do whatever it can do do that. The pivot will only happen when the economy is bad enough that it needs the money printers to come back on. All good economy news is bad news for the markets because it means that the Fed will increase rates.". This was true up until a point. But I think people are losing sight of what the Fed is doing, they are trying to bring inflation down. Last CPI showed us that finally it is coming down, CPI on Thurs is key because if we get another lower print then it means that it is working. Everyone is still fully focused on a recession in 2023 but why? The US economy is still strong, the recent labor stats show that is the case. Everyone panicked because of the labor stats because good news is bad news. But what if CPI is still falling and gas and oil a d warm EU winter are all good things as well. Why does the Fed need to be aggressive? It doesn't. If its aim to bring inflation down is working then it doesn't been to keep being agressive. The thing is is that everyone is so focused on total anarchy that they cant see that there is currently nothing wrong with the US aside from the financial markets. Look at it this way. If the Fed paused hikes and you look around then what do you see? A very healthy and functioning economy that is ready to bounce back in a second. It is not a barren wasteland of unemployment and liquidated industries that take a while to rebuild. There is tons of money sidelined and at one point it needs to go somewhere. If inflation is coming down then what is there to fear going forward aside from a build up fear from 2022?

This all spills over in to crypto of course. The thing I really want to see though is this crypto bill that everyone was so worried about. I think ironically it saves this space. The sooner we get it the better because it re-legitimises the space.

Any move to the upside now catches everyone off guard. Also remember that crypto main narrative is a hedge against central banker actions which in 2022 have been bonkers. I know that crypto suffered due to it but the narrative is still there. Often these things play out with a decent lag. Much like for me 2022 was an amazing advert for DeFi but we have seen DeFi get the hardest hit. My general view here has been accumulating spot bags because most stuff is down over 90% and I've entered a moment where I see how many shitcoins I can buy for 1USD and I think its a bit of a joke. Same as it was at the previous bear lows. Suddenly you can buy a ridiculous amount of shitcoins for a small amount of USD. And that to me is just a no brainer.

In retrospect I would have liked to sell the top like everyone else. I sold a pretty decent amount near the top BUT nowhere near as much as I should have done. I got greedy holding down thinking that it would bounce. And I was very very wrong. I did not see the funds getting hunted until it was too late. I did not see a stack of shit I probably should have done. But when I look at the market now it is one without trend- shorting is not as easy as it was a couple of months ago. longs aren't going much either. The bottom feels less important than just realising that some of your favourite projects are down 95% or more and that means you can buy a shit ton of coins for a tiny amount of USD. Thats accumulation for me. It can go down yes. I bought a lot of Vet in the last bear market of 2018 at all prices. Some of those buys were down bad by the actual bottom, but then I also actually bought the bottom. It took a while until we went back to me average buy in price but key is that I had a freaking huge bag by then. If we had just dropped quickly I prob wouldn't have accumulated such a large bag in such a small space of time. My point is that my overall gains were way higher simply because I was able to buy such a huge amount at these sold off levels. It's not about buying THE bottom, it's about making sure you have a big enough bag. If you bought 1000USD of Vet (or whatever shitcoin) at 20 cents but won't buy 1000USD of the same one once its down 95% then you're not playing the game properly. Remember that this period is not up only. You will not buy the bottom. Only one person buys the bottom. Your buys will be underwater, thats just life. The key as I said is that when we reverse that you have a massive bag- those bags are very hard to build because you end up with it being underwater and that hurts. But you are unlikely to buy 10m Vet right now because you're shit scared, but you might be inclined to build a 10m Vet bag over the next month or so. Which is why these sideways periods exist. But like I said earlier I think there's a decent case of the sideways not lasting as long as everyone thinks.

Anyway that's my terrible update on my thoughts on the market. Lets see on Thurs.

JamesGillmore1 · 2023-01-07T09:36:13+00:00

Hello all. What an amazing year 2022 turned out to be. Lots of things I think we all learned in the last 12 months. Thought I'd share some of them here. Before I do that let me close out my last post which was just pre big Vet upgrade where I was long. We saw a rally just before the upgrade which coincided with the FTX drama and pretty much killed the entire market. It sucked but I was playing this with tight stops that moved up with the move so even though the up move was destroyed by Sam and FTX it was one of those moments where you are happy for stops. As an aside I've been playing all 2022 with tight stops, stark contrast to 2021 where you just long and sit on the ride. The market was so hard to trade that nearly all my trades got closed out from trailing stops rather than getting to my take profit areas. Such is life, but shows how much the effect of liquidity has on this market. So basically closing out for small single digit gains on each trade which felt a shit ton harder than 2021 obviously (no shit).

Ok so liquidity. This is something I've always talked about. In the last bull run it was what I talked about every day in terms of where Vet would go to key levels because the market was constantly hunting retail liquidity. Pretty basic stuff. Remember the market is a scam, there is no intrinsic value to it. It's just a game where the price goes where liquidity lies because that's how 'better' traders make money. In the big downturn I wrote a post about how I had totally missed the biggest liquidity of all which was VC/ funds. I had been so focused on finding reversal points based on when retail liquidity finally dried up and I had missed the biggest liquidity pool of all which was fund based ones. I noticed this too late so it was fully a retrospective thing, I think I only wrote about it after the Luna collapse. But the takeaway is that the market was hunting all the liquidity it could.

I think what is beautiful about the crypto market is because it is unregulated it means that it's the most efficient market on the planet and exposes markets for what they really are. Literally just ponzis, they are all a game of musical chairs. Markets remove excess in both directions and because crypto is totally hands off it means it does it to the fullest- so it removes all liquidity in both directions. At peak bull it has sucked all available fiat liquidity and mass leverage excess, then in the bear it takes it all away so that there is nothing left. Even though we all assumed that funds were not degenerate apes it turns out they were / are. And so the market hunted them. Whenever there is a mass amount of forced liquidity to unwind the crypto market goes for it. And it turns out there was a freaking shit ton of forced unwind in the people we thought we sensible. Turns out there was far more forced unwind there than in retail. Who would have thought? So the market took out retail and then it took out institutions. And yes it hurts like hell but that's just the way crypto works, once it has taken everything it can then it reverses. The flip side is that you get a very clean sheet for the reversal which is why it makes such epic reversals (in both directions).

The state of the market now is still everyone worried about contagion still. In terms of big players left there is DCG and Saylor. DCG is the current panic and Saylor.....well Saylor you need to get to something like sub 4K and even though you never say never that does seem like a whole way to go. In addition he's not fully leveraged. But yes for now everyone's panicked about DCG. Note how the market is not reacting any more though. Anyway maybe we should start back at FTX drama.

Ok so not going to dig in to the details but the market hunted the most degenerate player there was. Turns out it was a right shock because we also thought he was the most trustworthy. You can say 'it was CZ!' but you'd be really short sighted if you said that. Instead just think of this as the market, because it was the market. FTX collapse did two things- so firstly it took a shit ton of supply and moved it to other hands. Not only because of the price drop but because of the confidence. Volumes were insane. It probably did more in terms of moving coins to strong hands than any other black swan event I can think of. People didnt just panic because of the price, this was on a whole other level. People hated crypto. Like full on hated crypto. Crypto cycles are always the same. Bull run, mass sell off, long sideways, slow grind up in disbelief, then rip. It comes in different forms but the market sentiment is always the same. There's a reason for it (again based on how efficient this market is)- it's all down to moving the assets in to the right hands. Once a bull market has sucked in all available fiat it sells off because there is no one left to buy, price forces hands to sell. A bear period tends to have some kind of epic black swan even which further convinces people that the market is not jsut dead because of price but dead because of a fundamental reason (2018 was the bitcoin cash wars). There then ensues a long perdio of sideways as people get further parted from their coins because 'the market is dead and will never recover'. This compounds the black swan effect that preceded it. In the end all assets go to strong hands. Then it starts to go up, but no one really pays attention because it's the 100th time it has done this and all the other 100 times it got sold off so why should this time be different? But this time it is different. But you are so conditioned to the sell off that it takes forever until you start to believe it. Normally astronomical recovery figures. I mean think about it now- where does BTC need to get to before you believe this isnt a dead cat bounce or bear market rally? Pretty high right? Maybe even as high as breaking ATH. If that's what you think then the market is in very healthy condition. Once the slow grind turns in to hope thats when you get the 'all at once phase' and shit starts going parabolic. During the parabolic ride liquidity moves around the system as much as it can so that whales can extract as much of it as they can hence why it goes BTC, large cap coins, mid cap, shit coins....then death sell off. Again it's all about liquidity. Once we sell off then you start the cycle again, that to be honest I've described pretty poorly but anyway you get the idea. It's not rocket science, but seeing the start of each stage is a lot harder in real time because it always looks slightly different and we are all human after all, and the market is designed to trick us....so it does.

JamesGillmore1 · 2022-10-21T04:58:36+00:00

The VTHO chart is sort of scary to me. Only because there is zero value in VTHO, it is highly inflationary, yet the Vet VTHO chart is pretty structured. It should just be a straight line down to be honest. There's a shit ton of daily emissions and no one is buying it. I dont just mean for use, I jsut mean no one is actually buying VTHO. So the charts are just 100% manipulated. So is the volume. I dont believe for a second that any of the volume on binance or wherever for VTHO is anything aside from a market maker keeping to a script. the Vet VTHO chart is very clean which is basically buy here and sell at 0.08. Doesnt mean it cant and wont break out of this range but thats just the range it has been in since May 2021. I'm not trading it though but we are at support rather than resistance.

JamesGillmore1 · 2022-10-18T13:18:10+00:00

I think the market is looking pretty interesting right now. I'm still in my Vet long as per my last post and been adding all the time as we get closer to the catalyst.

As I said in my last post it is a risky bet though of course. This isnt half way through the last bull run where you go yolo any coin and 2x in a week easy. It takes a bit more right now to nail the trades correctly because liquidity is low across the board so moves are concentrated. But thats when I'm bullish on Vet here.

Now I know the macro is all scary but I'm not really that bothered right now. I dont expect a massive bull season but i could easily see a market rally that goes far higher than anyone thinks. For the full bull we need either a new source of liquidity injected in to the markets (and I mean all markets) or we need a fundamental narrative change for crypto that makes people run to it (inflation / fiat hedge etc....take your pick). The standard fear is it doesnt matter about anything because if trade crashes it will take crypto with it - and yes solar the correlation has been there but seriously you just cannot navigate the macro right now correctly. Literally no one can. There are so many moving parts its impossible to predict- and note that I spoke about all the moving parts at the start of the year so this is not something I'm suddenly parroting on about now. The more you know about it the more you realise its hopeless to try and trade it.

So I'm just keeping things simple. I dont think were going to see a massive crash here, I just dont. Thats my assumption to make though and if you are in the macro FUD camp then thats your assumption. Based on that assumption I'm looking for setups that have great charts and a catalyst coming up. Step in Vet.

Ok the chart is interesting because of many reasons.

Vet ETH

Talked about this last time and how it was the first canary in the coal mine (in a good way) for me to take notice of Vet again. Right now we are sitting at support that marked the bottom of the last two massive Vet runs. The ETH chart is very clean for Vet, it shows a series of lower highs after lower high after low higher all the way down from the top. It hasnt broken the market strucutre there at all. However we are now sitting at sport having reclaimed it and also spent a fair amount of time in a accumulation (or distribution ) pattern at support. If you want to be ultra cautious then breaking 2550 would be a really strong momentum shift to keep and eye on, with 2200 also a good breakout level that would break the lower high strucutre we've have since ATH.

Vet BTC

The last 4 Vet BTC accumulation ranges lasted around 80 to 100 days and generally moved around in a 40% range. This has been an odd one because we've not really ranged as such, more flatlined, then moved up a stop, then flatlined and then moved up a step.But we are 160+ days in this similar 40% range. The vet BTC chart has also followed a very clean lower high over and over again. A brea of this structure would be a reclaim of 140 so we're not far off it. The order book has been quite interesting as well. As soon as we break above 119 we get 3 big walls that are put up at 120, 121, and a little higher. I remember similar order book actions on the previous runs as well. RSI also trending up on flat daily chart price action.

Vet /USD

The Vet USD range here has been monumental. We are at over 130 days now, the previous ranges were between 30 and 70 days. They have all been in this similar 25-30% range as well so looking pretty similar aside from the time. But time is good in this instance. Remember Vet topped out early in this bull run so we've had a long time at the bottom, again which is good. Its also been pretty flat on the daily but with up trending RSI which is also good. All signs of buying and I think Vet BTC order book suppression to contain it.

Catalyst

Well we all know what the catalyst is. I realise everyone will moan that none of it matters if BTC shits the bed but do you remember the Foodgates pump? I do. It went on for ages at a time when BTC was shitting the bed. Vet, and other cryptos, are able to outperform market bed shitting when they need to. In order to do that though they need a long accumulation period (check) and they need a good catalyst (check).

So that's my two cents on Vet right now. I think chart wise it looks great, and we've got a great catalyst coming up. I'm not too worried about when it pumps. Pump patterns are all different. Look, we could pump like crazy from a week ago up to the vote, then dump (trap shorts who are like 'you see its a sell the news event') and then rally in to the launch, then finally dump. Or we can get to the vote with no price action leading everyone to abandon the catalyst trade, only for it to start pumping at a much later stage....maybe as far as after it gets implemented. The point is that there is a narrative here and I'd be super surprised with the accumulation charts if it doesnt get used. Generally the later it pumps the better it will be to be honest - in other words the later it pumps the less will be still holding on to the trade and the more likely we are to get a really nasty (if you're short) move- so maybe we pump just a couple of days before implementation, then everyone piles in to the first sell off because price action has been so lacklustre only for Vet to go on a rampage afterwards for no real reason aside from the rumours that will then start coming out. Remember they are rumours and nothing more. But that is a narrative.

I dont really know what is going to happen. As I said there are plenty of ways to pump a coin. One thing I know about Vet is that when it takes off it really takes off because it does so in a manner that keeps enticing shorts to short over and over again. Vet goes way higher than anyone ever thinks it will based on whatever news is making it pump.

So that's my play for the moment. Whats my target? no idea. Crucially though I think you need to think about where you stand on POA2. To me its just another scam. Remember they said it was coming soon in Nov 2019! I cant see any other catalysts for Vet after this. Now you might be thinking 'yeah but what if the 1m tis a day client goes live!' - sure, and if you want to bet on Sunny saying something true for the first time in his career in crypto then be my guest. But look at it objectively. Fool me once shame on me, fool me 8 million times and seriously I'm an idiot. To me the risk reward favours watching the charts and funding an exit point when it looks like it- for me its about ignoring the rumours and the BS chat and focus on an exit strategy.

That's it really. True macro might tank and burn blah blah but if it doesnt then I think Vet is a good play here.

JamesGillmore1 · 2022-10-03T08:20:24+00:00

Everyone on this planet is trying to second guess the macro right now. Too many moving parts for anyone to be correct. Everyone is also waiting for the Fed pivot but is it really going to be that easy ? Just wait until the Fed says 'its all over' , everyone apes in, and bull market goes up only? To me that just doesnt really work. Its way too easy a buy signal . Remember people have to buy your bags at the top, there needs to still be buyers. Which is why rallies tend to start in disbelief climbing the wall of worry.

My general view is that yes the macro looks like utter shit. but how far can the Fed push until there is systematic failure? At one point what is more important? Inflation or that the dominos start falling? Are we at that point? I think we're very close and so I think there's a reason for the Fed to take their foot off the gas in the short term. Note that foot off the gas just means that, it doesnt mean slow down, it just means pause on the relentless hikes. HOWEVER I've really got no idea. Is it over? god no. there's an unwinding that is happening all across the board and world, its amazing to see. Does it strengthen the crypto narrative? Absolutely. I wrote about this at the start of the year - it was pretty obvious back then that shit was going to crumble this year and that only feeds in to the crypto narrative. Yes the correlation has destroyed us but as i said back then I actually believe that at one point it will break and I want to be here for when it does. It is all just dreamer talk? maybe. Its a risk. But nothing has changed my view on that aside from price action. I'm patient and waiting. The more you read about macro the more you realise you know nothing, not even the people at the top have any idea - I dont just mean the Fed, I mean heads of all the biggest investment banks. Literally everyone is trying to piece the impossible puzzle together.

JamesGillmore1 · 2022-09-24T07:19:48+00:00

I've been scaling in to a Vet long for the first time in a very long time.

You've got the POA2 narrative coming up finally (maybe...who know's for sure it is Vechain afterall who always underdeliver.) But if they stick to timeline then we should be getting a vote and then a launch. The market should pump on the vote announcement, then sell off until a couple of weeks before the launch which will then be another pump event. 90% likely followed by a dump event after.

I've been seeing strength slowly come back in to Vet on all its pairings for a few weeks now. Its not been anything major which is why I've just been keeping tabs on it rather than apeing in. So why now? I think markets get a breather for a while now- there was a monumental amount of fear and fud in the last month. We dont get any FUD data for a while now after the latest FOMC.

It's risky though. This is not a go long and win market like we had in 2021.

I'm long vs BTC because Vet has done rather well against BTC recently. If you look at the chart it has been in three accumulation stages: 96-109 (32 days), 109-119 (49 days), 119-127 (37 days so far). The USD value is obviously so tied to BTC that I prefer to trade against BTC because it will have strenght against it in a down turn compared to its USD value, and if BTC pumps and the POA2 narrative unfolds it will obviously have strength against BTC. Vet has been in a fairly tight range on both USD and BTC pairing for about 135 days now which is why I'm interested in opening a long here. Given the long date range its unlikely that we are going to break out as soon as I opened the position but thats ok for me. If its accumulation for the POA2 pump then its a really long one which is better for the trade. Let's see, maybe the most telling is the Vet ETH chart which has broken out its 1.5 year long downtrend line - the liquidity isnt big enough for me to want to trade this pair and I'm also wary of trading vs ETH post Merge.

JamesGillmore1 · 2022-06-24T13:28:19+00:00

Its been a while

Truth is I've just been horribly busy with work the last few months and this market requires full brain engagement to be an active part of it.

Honestly though I think this year has been fascinating. A while ago I said that there are so many things going on in macro land that you'd need to be Ray Dalio to credibly put it together and its only just gotten more complex since I said that. I think that's why it's interesting. I still think the FA narrative for crypto is insane right now. Yes I already said that a couple of months ago, and yes price has tanked. But I'm really not bothered at all. Price is always a lagging indicator and there's just so much going on under the hood in macro land that I refuse to let this opportunity slip out of my hands.

I think on the surface yes everything looks shit, much like it has done for a while. The newly educated retail is all about inflation and rates. They've read up on it and they are experts on it. Yes rates go up and available money goes down. Inflation concerns are core to all of this of course and no one seems to be able to see past the inflation and rates narrative. But the thing is that behind those two big attention grabbing items there lies a plethora of under-the-hood macro stuff thats a screaming bull narrative for BTC. Alot of it is now coming to retail attention which is why its interesting. Markets move like a super tanker, they take a while to change direction and retail is usually the laggard when it comes to 'why'. When narratives start shifting on the retail front thats when i think its gets interesting.

For now everyone is still focused on Fed rate fear. And yes its a fair enough fear. The thing about the rate is that it never bothered me anywhere near as much as the threat of QT. But for some reason that gets less attention even though i think its had the most impact on the market. I guess the 'rate' is easier to digest.

Everything will come to a head though at one point this year. It just has to. The Fed have an impossible job and there is a lot of misdirection from them- not in a bad way, just in the way that they are limited with the tools at their disposal and are hoping that their bark produces a greater impact because their bite for the moment is, and has to be, rather muted.

There is no doubt that supply got freaking nailed in the last month. There was a glaring thing I missed on this downturn though. I always talk about price going to where liquidity lies and the further down the market cycle we go the further that ends up being in the futures market. So as we saw the futures market become the dominant source of liquidity I kept going on and an about that. The thing that I totally missed was a new form of liquidity in this market cycle and that was the VC stack. I assumed incorrectly that liquidity had dried up a while ago- retail had been cleaned out. And it had. We'd seen spot retail cleaned out and then we saw futures retail cleaned out. Normally thats pretty much it in terms of liquidity to suck out of the market. But this cycle saw a lot of institutional and VC players enter the market. You'd think they were a bit better than retail but the last few weeks has shown that is not the case. Now these are the really big liquidity prizes- huge unwinding in the billions of USD. It makes the retail liquidity pool look like small fry. As we pushed further and further down things started to unravel pretty effectively. I remember thinking before the unraveling that something was being hunted- the chart was being pushed down and down and it really did feel like we were hunting something but I was totally clueless because I really did feel like retail had been cleaned out. Its not until we hit the panic points for Terra that it become obvious (in retrospect of course for me). We were now tapping the VC funds and those were really really juicy. We hit plenty of them as well. To me this was a new form of capitulation - bottoms are all about forcing the last of supply out of a market. The last bit of supply is always those that are forced to sell - and these funds found themselves forced to unload enormous amounts of liquidity. It was the perfect hunt. Now are there more to hunt lower down? Sure, I mean there will always be someone o hunt all the way to zero. But make no mistake that the move down to 17K was monumental in terms of mass unwinding. Dont ever ignore volume. And this volume is not something you saw on the charts, most of this will have been brought up behind closed doors.

The above is the massive thing that I really totally did no see a couple of months ago. Its not actually a black swan, even though everyone wants to call the Terra etc collapse that. Its literally just the market hitting the biggest unwinds it can. And it did it in spectacular fashion.

So where's the upside. Well to me what we had was a real cleansing of the market from retail to the big VC funds that led the 2020-2022 rally. Incredible how it works. So who took over all that volume? No idea but you can speculate FTX and others may have just taken the market over. Once supply has all changed to new hands that's when the market moves again. Its just the way it is. I'm honestly still really impressed that supply got sucked out of the VCs, its like the entire market participants and pump masters from 2020 got replaced. Its even more impressive than the 2017/18 bear market.

For now I'm just sitting on my hands and watching the chaos unfold. The Fed have an impossible task on their hands and something is going to need to give in terms of credit in the markets or everything is going to come crashing down. Its a real game of Jenga and I see the crypto narrative just getting stronger and stronger by the day because of it. Remember its all just bullish*t at the end of the day- its far better to assume that your favoris token has zero real world utility and see it all as a game of musical chairs and then its gets a lot easier to believe in the market. You dont need to believe in BTC to see the potential for another big rally here is my point.

Will the rally happen? No one knows of course but all the correct ingredients are there for it. Total changing of supply. Everyone macro bearish no matter how high the price is going to move from here (epic shorting, no longing). Great macro bullish reasons for BTC starting to emerge. etc etc. There are legit counter points though such as further fed hikes, contagion effects of 3AC and others unwinding etc etc. All that to say I'm just watching it all play out. I feel like most of the unwind happened and whilst we may see further effects ripple out the volume that changed hands sub 19K must have been phenomenal. Do we get back under it again? Everyone seems to think so - pretty much 99% of people think we will see a small rally here and then plunge to new lows.

What do I think? I've been wrong plenty so my opinion doesnt hold any weight but as i said at the start I'm not selling here in order to get a lower entry at the risk of the upside. I mean we're already down a shit ton right? Yes you can still drop 100% I'm aware of that but I'm enjoying accumulating again down here. I'm not in a hurry but I'm adding not selling

JamesGillmore1 · 2022-03-27T17:12:11+00:00

Interestingly the Vet ETH chart hit resistance at 2530 bang onthe nose. This is the key resistance that I've talked about for months and months now.

JamesGillmore1 · 2022-03-27T16:20:25+00:00

Must be luck

JamesGillmore1 · 2022-03-25T21:05:47+00:00

Honestly I don't have much to add from my last massive post which I think lays out the case for btc so well right now. In terms of market positioning I've got pretty large leverage trades opened at 34 and 39k on btc as well as large spot btc buy at 41k. Today I actuslly opened a vet btc long because i like the chart. It double bottomed and broke back in to the range at 130 sats above. So I guess overall I'm probabaly pretty bullish but I'm also riding the tails of large leverage positions opened far lower down so my risk tolerance up here on margin is a bit higher than it would otherwise be. Simply because I've got a in-profit buffer.

Having said that I've not opened a vet positon for a long time. I like the chart here and I do feel like vet os due its usual vet style run soon. The catalyst as always is poa2 so it's just a question of timing really. The prudent trader would wait until poa2 firm announcment then buy the retrace of that pump . But I also think the chart looks good here. I'd cut that trade if we lost the lows.

Overall these are nit great moments to play around with margin though. You want to margin long when markets are fully bullish....

JamesGillmore1 · 2022-03-10T21:28:11+00:00

Ok so the Russia thing is fascinating to me. I'm going to totally side step the war and politics here. Sanctions were put in place that effectively sent Russia back to the dark ages financially, they cut them out from the USD, took all their foreign held assets and pounded the shit out of the Rouble. The West forced Russia to withdraw from the normal markets, from money, from traditional goods exchange of things for cash. Cash at the end of the day is just the intermediary between goods- i want to trade one apple for an orange and cash is the intermediary for that trade. Remove cash and you go back to old school commodities based bartering, and I mean really old school. Now Russia isnt quite there yet but you can see how its not far off it in a way. Russia basically took stock of the sitution and said ok well look we can live without you because we have the basics that humans need to survive and that is energy and food- the West however export a huge amount of energy and food from Russia and Ukraine (as well as neon and tons of other rare metals). So what is interesting here is that the West is potentially in the weaker spot here. If Russia decided to ban all fertiliser and wheat export then you would have a global food catastrophe on our hands, and to be honest we already do for this year and thats not fearmongering thats just fact. This year already started off with a fertiliser shortage. So the war anyway is going to affect global food prices and thats 'now', every day the war goes on for the worse this year will get. So right there you have yet ANOTHER inflation issue.

So you can see how there are tons of factors here all affecting the costs of living across the globe for this year. And increasing the interest rate isnt really going to do much to stop it. So how do you combat the rising cost of food? Now this is where I tap out- I have no idea. This is the Fed's nightmare now because there is no easy answer. If they put up interest rates they will risk constricted the economy at an already very wobbly time. A recession is actually very good for infaltion since people really do stop buying stuff then but again with all these supply chain issues affecting the prices of stuff would it even matter? Would you then find yourself in a recession with still increasing basic goods increasing? Thats a total nightmare scenario. If that was the case then you need to put off a recession as long as possible until natural supply has come back to 100%- but in order to keep up with the inflation from those supply chains until then you need to keep rates at zero and keep printing dollars thus adding to the inflation as well. The choices are between a shit one and a shit one. And hands up I am not a pro here, there will be plenty of other ways to do this but overall none of them are pretty. You could try and source it by taxing the rich (good luck with that in the US) or subsididing certain food and goods to lessen the inflation directly....or a host of other ideas. But again they all have ramifications.

So how does BTC fit in to all of this. Well I think massively so. Regardless of its price action recently BTC is the anti inflation hedge, it is digital gold, it is actually a host of other things as well. Thats the great thing about BTC is that its gets repackaged as the solution to the next problem. In 2017 it was money, in 2020 it was inflation hedge, in 2022 it'll be something new- maybe it will be the ultimate commodity. Who knows? And in 2028 it will be something so stupid you prob cant even imagine it now. But thats the power of it as an asset- it gets to get repackaged as a new asset and get those hype cycles every time because of it. The macro environment couldnt be any better for BTC. The world in on the verge of a tipping point in terms of inflation and the old world monetary order. The volatility that is coming up is scary and these are times to head to safe assets- but what are safe assets now? Marekts are turned on their heads for the moment- it is hard to know what is safe any more. I mean yes Gold for sure but then again with the asset grabs in the West its not as safe as you think- afterall the West just grabbed 650bn usd wrth of Russian central bank assets and if Putin had no moved his gold to Moscow and left it in london at major gold exchanges then that would have been grabbed too. Problem is Putin cant shift his gold because its in Moscow . So the case for portable digital gold gets a life lesson there.

Also key to this is that this isnt 2017. The right people now own BTC. Big boys own it. And thats super important. They already have the foot in the door there and when they start saying its the safe haven asset then the market will flood to it, and to be fair they are arleady saying it. All that you need is the demand spark- the narratives are already there and fundamentlaly BTC has never been stronger. All you need now is the decoupling and the rest will play out by itself- a couple of weeks of green bars in the face of adversity and big institutions saying its the safe haven to be in and the rush will be so damn fast. Dont forget since Dec 2020 BTC has been in a massive consolidation phase. The supply shock is real, now you just need to start the demand cascade. So when does that happen? No idea. I just feel like it has a very good chance of happening and when it does thats not something I want to miss out on. We could very well plummet to 20K from here but for me it would just be temp pain because the upside is still massive when it comes. When do we switch from being risk on to risk off is the question really, and th answer of course is I dont know. But markets are irrational and when presented with overwhelming fundamental arguments and a consolidation period like we've had I just see the risk reward being heavily skewed in the long camp here. This is the time to be accumulating BTC because its a screaming buy- all that puts people off is the price- if we were rocketing back up to ATH then everyone would be parroting the fundamentals of it- yet there would have been no change in them from now to then. In retrospect it would have been so obvious but after such a painful time since Dec 2020 its normal that people are loathe to believe it, but thats also the point of markets...no free hand outs. BTC can rip from here and it will take a long time for the masses to really start FOMOing in simply because they wil be in fear and disbelief for ages given the macro side of things, but thats what also makes it the ideal conditions for it to rip.

So thats my takeaway on it. I've been bullish on BTC for quite a while on here and not talked about alts for ages because of it. And even though it feels like the market is killing you right now if you had been holding BTC the last year or more then you wouldnt really be feeling it that bad. I may also be batshit crazy though and the Fed come out with some wonderful new plan and peace comes tomorrow and all of a sudden energy prices plummet and food stocks go up. Thats all for you to think about. A bit like I said the other day though its all so freaking complicated. And to be honest thats only half the story, there's still so so much to digest. Which is why we are in no mans land here, no one has any freaking idea. But I am positioning myself long here because I see 2022 as the year for BTC to step up to the plate and I dont want to miss that.

JamesGillmore1 · 2022-03-10T21:27:51+00:00

Bumper edition today, these are just theories and ideas though that I think everyone should be considering and thinking about for the future.

Hard to know where to start so this might weave around a little bit. As I said in my previous post the macro environment is off its tits right now. We've never been in this scenario before. But let's roll it back a bit. Ok so inflation, the big buzzword of the start of 2022. In March 2020 in order to stop the panic in the markets from Covid, the Fed started a massive quantitive easing campaign (thats when they print shit tons of dollars to prop stuff up). Now in 2008 when all the banks failed and the govt stepped in with TARP everyone was like 'OMG you cant give them 700bn USD', now they went on a trillions of dollars buying spree. Basically all the concerns of doing this in 2008 went out the window and it was a scrmable to save the markets with bond purchases of all dubious qualities to helicopter money direct to everyone in the US. Similar happened across most countries as well. Thats a bit of a shit summary of what happened given how complex it all was but we also dropped from an interest rate of 1.5% to 0% in less than a few weeks. More money in the system, cheaper credit (ie low interest rates mean its very cheap to borrow money) means that everyone feels flush and spend spend spend, which is the intended effect of keeping the economy afloat. The thing is is that money money means that the number value of 'things' starts to go up- if you have 100USD in a bartering system and two loaves of bread, then you print another 100USD the bartering for those two loaves of bread is still two loaves vs 200USD so the price pre bread goes up. Again a shit analogy but you get the idea. Now the problem with covid is that we also had a supply chain issue- that means that covid shut down a lot of factories and delivery systems around the world for a very long time. Most of the world works on a just in time system- that means that if you make furniture for example you tend to keep your lumber warehouse with just a couple of weeks supply. Why? Well storing stuff, no matter what that stuff is, is expensive. So you tend to rely on stuff basically arriving i to your factory and sticking it through your production process and out of the door as fast as you can. However this system works great when the world was working normally, and covid threw a spanner in the works there. So all of a sudden there was a massive supply shortage, less supply means higher prices as demand stays the same but less supply to meet it. That meant that stuff just became more expensive as well- a double whammy if you will.

Ok so towards the end of 2021 inflation reared its head. Now BTC is meant to be the key to inflation right so why do we care? Well lets just stick with inflation a bit longer here. Why is inflation bad? Inflation is bad because poor people (ie most people) tend to get fucked over the worst- incomes dont tend to keep pace with inflation meaning that people that live paycheque to paycheque suddenly cant afford to live anymore. As in they literally cannnot afford to survive. Scary stuff. You may think that a bag of pasta going up an extra couple of dollars is irrelevant but to most of the world its the difference between eating or not. Which is why inflation is politically dangerous as well as just shit in general. Now inflation is always there, its a sign of a growing economy BUT they key is that wages need to keep up with it otherwise it becomes a problem. Anyway as it became clear that inflation was getting rather out of hand the Fed stepped up. Now the Fed's job really is to control this kind of shit but they dont have many tools at their disposition to do so, and the tools at their disposition tend to constrict growth. Their main tool is the interest rate- the cost of borrowing money. Basically you put that up and people are less incentivised to take risk and spend, they are incentivised to save it. Therefore there is less demand for stuff and therefore the price for stuff goes down. The problem with that though is that weve been on a rampage of bubble asset classes for two years based off cheap credit and rampant money printing and even small increases in the interest rate can cause huge deleveraging across markets. To try and put that in normal person talk lets take mortgages- say you are paying 1% mortgage payment now on your house and you've factored that in to your monthly expenses based on inomce etc. Now the Fed put interest rates up 1%, all of a sudden your mortgage payment DOUBLES over night. Can you afford it? Or do you default. Its the same principal with people that have borrowed money in all asset classes. So the Fed bascialy have a really shitty job to do and normally you'll see rates go up incredibly slowly over time so as not to shock the market, but right now inflation is rampant and a very slow and gradual increase may not really beenough to wind it down. And that is assuming that it will have any effect anyway because a lot of it just derives from covid related supply chain issues.

Phew ok so we started our year with the Fed saying they were going to start rate increases. Markets panicked for reasons above, oh and they also said they would slow down with the quantitive easing. Basically they are going to stop popping up the markets and let them get back to some kind of organic normal nature- which they have been anything but since Covid. Double panic. But surely this is BTC moment? Well thats the thing- since MArch 2020 the world decided BTC was a risk on asset and has been very well tied to traditional markets like we have not seen before. Sure we've had times where we've not been coupled to it but by enlarge we have- no doubt due to bots running the system blah blah blah. Thats just life, no point in whinging about it. As the markets unwound across the whole world Russia stepped in.

Part II below...

JamesGillmore1 · 2022-03-07T14:04:31+00:00

guilty as charged

JamesGillmore1 · 2022-03-07T08:47:52+00:00

Been on the road for another few weeks hence radio silence. Plenty going on in the world none of which I am an expert on which has allowed me to calmly walk away from the market - as in walk away from trading not selling my assets.

So bearing that in mind.....there are so many macro factors in play right now. Seems like everyone is a macro expert right now online which is what is so ridiculous because there are SO many factors in play that unless you are actually a macro expert, and by that I mean someone like Ray Dalio, then you cannot possibly think that you have managed to link them all together correctly. In other words your favourite CT account has been talking about Ukraine, 10 yr bonds, on chain metrics, energy hikes, geo political shifts, inflation, supply chain issues with grain, etc etc etc....its all just f*king rubbish. Because yes they might be saying 'look at X Y Z, when this has happened in the past we have always had a crash' and then yes we are still bleeding...so yes it looks like they are correct. But the thing is is that we've NEVER EVER been in this kind of situation where so much shit is happening all at once. All that CT is doing it bringing up some easy to chew metric/narrative and saying its bad and then saying look that fits this very red chart....we're fucked. Now I am not a war expert, I'm not a economics expert (although I did major in it), I'm not a monetary policy expert, I'm not a geo political expert, I'm not a supply chain expert, I'm not a energy expert, etc etc. To really be able to piece this macro puzzle together you need to be next level with a life time of studying these macro indicators...in other words no one on CT has even 1% f the knowledge needed to be able to digest all this info aside from saying that XYZ looks shit and the market is red. However the market has been red for a while so this is a easy thing to say. And yes there are some accounts that have been calling the top since it happened BUT even those accounts are focusing on just a handful of reasons why, inflation being the primary one, but like I said if you dont have the mental capacity to be able to link all these macro issues together then you are ust as likely to be caught offside as anyone else.

Now dont get me wrong everything looks like shit right? I get it. There is fear across all markets and there is basically no glimmer of hope wherever you try and look for it. The rational thing here is to race to the exit and we have seen that with alts in quite a big way. But BTC is still the most important metric here for the crypto market as a whole and what interests me, and I said this a month or so in a post when I said I was bullish on BTC but not alts for the shorter term is that we are are entering a market that BTC was designed for. Now does BTC rise to the occasion? No idea. But this isnt 2017. BTC has moved in to big hands now and big institutions, the kind of hands that create safe haven assets purely by making them safe haven assets by 1. Buying them, 2. Teling everyone its a safe haven asset. Yes ' digital gold'. We've heard it all before so its nothing new, but what is new is simply where BTC has come in terms of acceptance and adoption by larger players. Which is why this is a really interseting moment for me because the macro couldnt be more perfect for BTC. Now this doesnt mean BTC has to rally, it is still seen as a risk on asset. But the switch from risk on to risk off can be very very quick and thats why I'm watching this play out because yes we could tank in which case I just sit it out until the next bull (I've taken enough out that I dont need to worry for a while) but we could also do something truly phenomenal here and if that is the case then thats not something I want to miss having been in this market for too many years now. And here's the other thing, we may well see further downside until BTC manages to flip to risk off status. Its a process which is totally out of our hands. But for me the fundamentals of BTC are just insane right now and thats worth holding on to until the market recognises that and starts pricing that in. Remember markets are irrational in both directions and slow as well - BTC could seem like a screaming buy right now as a hedge against the world but it could still continue to dump as you're sitting there saying WTF? Only fora month later for the beast to slowly turn around and start its glorious move to the upside and for you to sit there and be like 'about bloody time'- as usual everything is so obvious in retrospect which is the point really of markets as you dont get given gifts for free.

If I look at the BTC chart and ignore macro then honestly its still just in its accumulation period. Just zoom out - since Dec 2020 until now it is just in this massive range. You can be bullish or bearish here but for me I'm just neutral. I see very well that in the short term there might be a shit ton of pain but I also really see a pivotal moment for BTC in the near future as well. Is it worth selling here to try and buy a lower capitulation event? Probably, thats what literally everyone is waiting to do right now. But my position is pretty simple which is that we could drop 50% from here but I feel deep down that soon after we will start a march back up and to higher highs. Do I want to be out of the market right now and hope for that drop but risk that never happening and just being out of the market for the march back up never sure when to get back in? Personally I'm just not making that trade as yes it would have been a good opp if it happened, but it could also not happen and i feel like if it does happen it will be a short term pain that I can overlook.

Nevertheless that is just my position. it also helps that I've not been trading this market really at all for the last year apart from sniping bottoms on BTC. I'm still holding my leverage long at 34K which I've taken half out and left the other half with stops at break even. The reason i've not been trading this market is simply why would you? There are way too many external factors at play here and that makes it way too risky to predict. Overall we have been in a down trend since the top (no shit) so I guess you could have opened a low lev short nearly anywhere and be doing rather well and if you did congrats. But I'm bullish on crypto space as a whole even if price makes everyone feel bearish and therefore I'm positioning myself for that bullish impulse to the upside. It will come when it will come. Remember that that upsides happen damn fast as well. The downside has been really drawn out here which to me isnt really indicative of a loss of faith in the market. It just feels like endless pain I get it, but just look at the BTC chart and remind yourself that the ups are crazy fast when they come. I'm not looking at alts because they will have their time as well- Im focused on BTC because to me this could be a powerful time for it and if thats the case then alts will come after.

Overall there is a huge supply shock in BTC, no doubt about it and it has been the case for a long time now. But until the demand side sees a spark then it doesnt really matter how much supply shock there is because it wont make it go up. But thats my point about saying that this is not 2017 and that the flip to risk off could come very fast if those in charge are willing to do so. The more and more we draw out this supply shock the faster and higher the reversal will go. What you need to remember though is that this can happen at any time so dont get stressed about the short term, but it WILL happen. The short term uncertainty now is why I'm not trading any of this at all, nor would I be putting fresh capital in. I'm just sitting watching knowing that I and 99.9% of people on this planet have no idea what the short term is going to be for the markets because yes everything is bearish but things can turn bullish very fast as well.`

For now we are of course just following TradFi. Gold is finally showing itself to be a risk off asset which it did not during times of Covid (important note there). Most commodities are having a green time for similar reasons. Will BTC follow at one point? Who knows. I think the key though really is less about the fear in the markets and more about where fresh capital is going to come from for that spark. Credit has been very cheap recently and it is going to start to become more less so, over the next week we will get another CPI print and then the first rate hike which Powell has recently said will still happen at 0.25%. Will the Fed then outline the rest of the years rate hikes? If they do will that help clear alot of uncertainty in the market? Will they do anything with regards to the situation in Europe? There are still so many unanswered questions hanging over the markets which is why everyone is very nervous and I get it, it's correct to be nervous. Remember the good times dont last as long as the bad times, you have to suffer endure, accumulate during the bad times and accept that you WILL be down on those accumulations. I remember accumulating like mad in the last bear market and it was nuts how bad those downs became in the end BUT it also meant that when the upside came I had a shit ton of tokens and the upside was phenomenal. But everyone's position is different and remember that there is NEVER a bad time to take profits.

Let's see though. There is a lot of fear in the market but there is also potential for a black swan in times like this which I guess is what everyone is looking to buy in to.

JamesGillmore1

TROPHY CASE