#6 | Coffee & Markets

Friends,

A few quick setups I’m looking at. With the bullishness still in place for the short-term, today is a great day for entries, I don’t want to catch a falling knife, so I’ll try to practice patience and confirmation.

Decentraland (MANA)

With a decent underlying bullishness I am willing to take a punt here. However, I must stress that this is not high-probability in my book, since both Ethereum and Bitcoin are facing some resistance (yet I remain bullish, personally), and if they drop, so does the rest. Thus I will be taking a high-risk approach here and percentually investing no more than 0.5–1% of my active portfolio.

The bitcoin-pair looks better than its counterpart in my opinion. However, I actively only trade the USD pairs, so I will use it for reference. I have outlined what I would do in the case of a confirmation, and I stress: confirmation! Especially in cases like this, I want to see confirmation / reclamation of a level after a sweep on the hourly. I’m less interested in nailing the entry than having my directional bias be correctly in the short-term.

So, on the dollar-pair chart I have marked some potential trajectories and the green arrow may be my entry. This is not a limit order set kind-of-cookie; I’ve set alerts and will decide at that time whether I have an appetite to execute this plan, since if I can’t get a tight-ish entry, the reward may not outweigh the risk to me.

Tezos (XTZ)

XTZBTC 1-week chart

It was Nik Patel who brought my attention to Tezos in his weekly Market Outlook (which Coffee & Markets is obviously my version of, full transparency).

Tezos is looking beyond strong in terms of R/R (Risk/Reward ratio). A clear invalidation to me is a weekly close below the all-time low and I’ve entered a position here. With potential and primary targets at 25k sats and 50k sats, but that may all depend on circumstances when we get near these targets. This is clearly a long-term hold but if it pays off the risk is well worth it. I’ve allocated 3% of my portfolio thus far, and will look to add an additional 2% if we find a confirmation of 13k sats being broken and holding firm. Risk-averse speculators may enter when the previous all-time low around 8.5k sats is reclaimed, or around when 13k sats is reclaimed and holds. Another option for those with more patient hands, is a sweep of the current all-time low with a swift reclamation. I’d like to stress that the closing of a weekly candle below and the continuation below the all-time-low is not a strong reversal signal and I would cut my losses at that point. Note that this is a large market cap coin, thus I allow myself to allocate up to 5% of my portfolio on it.

GEEQ

I was informed on GEEQ by Nik Patel’s blog as well, so credits go to him.

GEEQ has retraced about 96% from its all-time high, which is significant. If you invested $100 dollars at the top, you’d have $4 at current rates, if I’m correct. A good reminder for sanity’s sake.

Starting with the dollar-pair, it has recently reclaimed resistance around $0.60 and I’m looking to buy 1% (in terms of my spot portfolio) when we retrace back into that level. I naturally play Bitcoin charts, but I am using the USD chart as a reference for a change in direction. I expect to hold this position for a long while, targeting new all-time highs for the dollar-pair.

The bitcoin-pair is looking similar, having retraced and found a bottom, awaiting a break-out above the range resistance at 1700 sats. Risk-averse traders may wait for that confirmation of break-out > retracement back into 1700, but for me I’m happy to get in once I get that retracement on the dollar-pair, targeting primarily 4500 sats ± and beyond. My invalidation would be a weekly close below the all-time low.

Hathor (HTR)

This is a project I scouted on Twitter, but it looks promising. I am working on the fundamental research as we speak but I’ve entered a position today regardless (1% of my spot portfolio thus far).

Invalidation would be a weekly close back below 1000 satoshi’s, after which I’d look to re-buy a potential sweep of the all-time low. I’m looking for a new all-time highs and I expect I’ll be holding it for a while. For now both the USD and the BTC pair look quite good. Risk-averse investors may choose to wait for a solid confirmation above 1700 sats with a tighter invalidation or back below 900 sats into the depression range between 900 and the all-time low at 400 sats.

Brief note on my positions:

When position trading (meaning buying and holding for longer periods) I trade against BTC (or ETH). My goal is always to increase my portfolio’s BTC value, since I believe that in the (long-)long-term Bitcoin will outperform the dollar, regardless of bear markets. I might open long-term shorts to hedge bear-trend losses of equity but I personally never sell my full Bitcoin holdings into USD. This is how I do it, make your own strategy and plan. Thought y’all might want to know.

Hope it was a valuable read lads and lasses.

Best of luck,

Cyril

crypto trades — coffee & markets — risk management