Tracking Crypto Whales

A weekly news and trading piece by Scott “Shooter” Henderson covering crypto currencies.

Kirk & Shooter’s Crypto Thesis

The short story is that most cryptocurrencies are going to zero, but there will be survivors that rise to much higher price ranges. This is a journey of separating winners from losers.

We expect Bitcoin and Ethereum to be among the biggest, if not the biggest, winners. Along the way, we can trade the larger moves for added gains.

In the News

Here’s what caught our attention this week…

Bitcoin Whales Report

According to glassnode Bitcoin whales are continuing to hold aged Bitcoin which fundamentally support the above thesis. AKA, limited supply and those who continue to hold on or off chain determine the future path of the price of Bitcoin. Scarcity can be a powerful drive.

Historic Adoption Rate is on the Horizon

Adoption rates of cryptocurrencies and the internet. As we dig into methodology on estimating adoption rates all we need to do is look at history for some insight. Shooter feels the best way to calculate adoption rates is to use known internet users divided by the active crypto wallets. To date this seems to be the most accurate method to project future cryptocurrencies adoption rates. At the current rate future adoption rates should be at least 3x from here.

What is PTE?

PTE (or “pay-to-Earn”) The idea of earning money through video games’ in-game economies is not new. As long as game economies have existed, players have found ways to make money. 

What is Defi?

DeFi (or “decentralized finance”) is a sector term for financial services on the blockchains, primarily Ethereum. The idea of DeFi, is to create the ability to do most things that banks support and more — lend, borrow, earn interest, buy insurance, trade, etc. — it’s fast and doesn’t require paperwork to complete a transaction. Just like crypto as a whole, the DeFi concept is a global, operating on a peer-to-peer network, in an open to all decentralized concept.  

What are NFT’s?

NFT’s (or “non-fungible tokens”) are the latest crypto phenomenon that transform digital works of art and other collectibles into unique one-of-a-kind, verifiable assets that are easy to trade on the blockchain. Christie’s auction house sold the first-ever NFT artwork. Beeple sold a collage of images for a staggering $69.3 million and even Crypto Kitty has a collection.

What is the Metaverse?

The Metaverse is a digital world, where users interact with each other much like real life yet in a virtual environment. You use an avatar versus your person. One neat feature is that you get the best of both worlds, business, pleasure, social, and even gaming. Some Metaverse crypto and stocks are pure plays, that is, companies who do nothing but the metaverse. Others are hardware companies that already have successful businesses but we’ve found they will likely benefit from a new revenue stream. In many instances, the metaverse requires the use of augmented reality (AR) or virtual reality (VR) headsets. Software companies can also be metaverse stocks. Several growth stocks are poised to benefit from the metaverse trend, while other stocks are already members of the Tech universe with history and new technology. 

Note: We will be adding RBLX, FB, NVDA, U, MTTR, META, MSFT and AAPL to our list of stocks with Metaverse exposure as an update to this article either Monday or Wednesday this week. So, check back. 

Shooter’s Crypto Picks and sector Stocks

It time to seriously consider what percentage of your portfolio should be held in the Cryptoverse. Crypto is still very speculative. However, the risk rewards is unprecedented. Stay tuned as I jump into Defi, Pay-to-Earn gaming and others shinning stars in the new year.

Make sure to adhere to a rules based approach to trading using technical indicators. And, we highly recommend trailing stops and/or stops at preset technical levels.

Follow along in chat if you are going to swing trade a portion of your account. We recommend starting with trading 5% or less of your total portfolio and no more than 20% even as you gain experience.

USER GUIDE

Scale in small on all entries!

“Next Entry Window Long label” or “Set-up Long Label”.

Crypto Elliot Wave Counts / Set-ups / Next Entries Long or Short

XBT/USD Bitcoin closed the week at $43083.78. While we opened at $42311.21 and showed some relative strength vs. equities. The count has reset suggesting the drawdown will likely continue to maybe $34232.49. I’d trim and buy it back. Then we should get a decent bounce off that low back toward the 8 day support line ($47344) then continue down to maybe $33854 and bounce again toward $37038 and head to complete the primary wave (B) maybe down at $31923.09. So, from a technical perspective get these levels on your chart or site on the sideline here.

Bitcoin / US Dollar Pair Monthly Chart
Bitcoin / US Dollar Pair Weekly Chart
Bitcoin / US Dollar Pair Daily Chart

ETH/USD Kill that dead cat bounce idea. Though, until the minor wave (2) holds its is still a possible outcome. Counts says that $2931.53 was the floor which is why I was off $20 bucks off. We still have divergence in the time frame counts. We should take off as suggested last week. Still seeing divergent counts so both are in the same direction just different trajectories and time frames.

Ethereum / US Dollar Pair Monthly Chart
Ethereum / US Dollar Pair Weekly Chart
Ethereum / US Dollar Pair Daily Chart

CRV/USD Raised the Stop to $4 with that Minute wave II holding. Continue to cost average into your position. Outlook puts this in the teens into 2022 or soon after. Stay tuned for additional notes on staking.

Curve DAO Token / US Dollar Pair Monthly Chart
Curve DAO Token / US Dollar Pair Weekly Chart
Curve DAO Token / US Dollar Pair Daily Chart

AXS/USD Next Entry Long has been adjusted down to $55.37 wait to add anything until that manifest.

AXES US Dollar Pair Weekly Chart
AXES US Dollar Pair Daily Chart

SAND/USD We put in our first Primary Wave (2) this week with a target that measures to $17.65 range for Wave (3) 3rd to 4th quarter 2022. Sands adoption is multiplying with Metaverse players. We have a Primary Wave Set-up but do not have triggers. I will add another piece next week regardless. 

SANDBOX / US Dollar Pair Monthly Chart
SANDBOX / US Dollar Pair Weekly Chart
SANDBOX / US Dollar Pair Daily Chart

Good Reads

The Future if Crypto Banking

CTS Article Archive

Scott Henderson’s Risk Disclosure & Disclaimers

Follow Shooter on Twitter @swingtradenotes for his quick thoughts.

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