December 17, 2021

Peak Fear and Wild Price Action

Dec 17, 2021

Introduction

Another day full of volatility and fear lies soon behind us, and again, stock and crypto markets have tumbled hand in hand, followed by a relatively strong bounce from the lows. It’s clear: Nervousness in the investor community is still sky-high – but “buy the dip” mentality as well.

At this point in time, the fate of crypto prices is – unfortunately – strongly linked to the health of equity markets. As you can see in the charts below, today’s price action of BTC and the S&P 500 has been almost identical.

One small comfort we find amid the strong correlation between crypto and stock markets is that Ethereum has been bleeding less than tech stocks…

light @lightcrypto

Out of this world relative strength, ETHUSD (blue) vs NASDAQ (white):

If you have been reading this newsletter for some time now, you have surely not been surprised by the increased volatility of the last weeks, as we indicated that the Fed’s hawkish pivot, combined with a slowing economy, could lead to a very shaky market.

Does that mean that everything will only go down from here? No, because despite the immense uncertainty all around, the chance of dip buyers stepping in and supporting the markets is still fairly high. We would likely need more cataclysmic events to send the stock markets down to tremendous new lows – which is, of course, always a possibility.

All in all, the current investing climate is certainly not for the faint-hearted, and you should be prepared for more rollercoaster rides in the weeks ahead!

Market Outlook

The last weeks’ market downturn has undoubtedly left some scars on crypto bulls. However, technically, the weekly uptrend and the hope for renewed bullish price action are not lost…

Pentoshi 🔺satsdarts lover @Pentosh1

GM nothings changed on $BTC Building Longs 42-47 Bears still in full control and marching forward. Leaving no survivors on each bull defense. They have the city surrounded. Losing 40.7-42k would signal the start of a new regime Only those that play offense + defense thrive https://t.co/wFzmlurSii

Pentoshi 🔺satsdarts lover @Pentosh1

$BTC 4hr, 1D + 1W Still a ton of work to do for any reversal Lot of diag resistance and Structural resistance Below EMA's on 1D Below 21 EMA on weekly Obviously been building long pos. Would still love one last flush Want to play alts heavy w/ strong Market struc (very few do https://t.co/RpT90btsRg

We continue to see a “battle” between – likely institutional – crypto sellers on Coinbase and accumulating crypto whales on Bitfinex.

Byzantine General @ByzGeneral

CB has been pretty aggro. I think 45k definitely isn't out of the question. $BTC

Byzantine General @ByzGeneral

I'm still of the opinion that this range is accumulation though. CB, Nancy and Finex all trying to catch a bid in low 40Ks and this looks real to me. Very similar behaviour as the May-July range.

Will institutional selling be exhausted soon, with today marking the last trading day for many funds?

IamNomad @IamNomad

OTC flows all this week have all been people tapering their positions. Today marks the final day of the year for many funds and corps. I dont have a feel if that means for the market. historically we've the gambit of price action during the holidays w/ Q1 setting a new trend.

IamNomad @IamNomad

ape translation : business people sell for tax man and santa. price has done all kinda of shit in between christmas and new years.

Wild Stories Only Crypto Can Produce

What a crazy day it has been – not just price-wise but also when it comes to other emerging stories. First, Justin Sun resigned as the CEO of the Tron foundation in order to become an ambassador to the Caribbean island nation Grenada... Then notorious crypto-hater Brad Sherman lauded the Mongoose community for donating to tornado victims… 🤯

lito @litocoen

this must be the weirdest thing that happened this year

H.E. Justin Sun @HEjustinsun

I have accepted the invitation and appointment of the Grenadian Gov. to officially serve as the Ambassador, Permanent Representative of #Grenada to the World Trade Organization in #Geneva. I will be working in full capacity to represent Grenada’s national interests, to the @WTO https://t.co/9Ke37rD7KQ

Rep. Brad Sherman @BradSherman

I may not agree with everyone in the crypto community, or the emerging mongoose community, on each aspect of financial services regulation. But all of us are united in our concern for the people of Kentucky. (1/2)

Mongoose Coin $mong 🏛 @mongoosecoineth

🏛 MONGRESS ANNOUNCEMENT 🏛 The Mongress is thinking of every family affected in the Kentucky Tornado. Our hearts are with you so we’ve made a donation to help with the Western Kentucky Relief Fund. 1/3 https://t.co/sOiXVK34CM

TRVL Airdrop

If you are currently holding Travala’s AVA token, you are eligible for a TRVL airdrop. Don’t forget to submit your wallet today!

Travala.com @travalacom

Attention $ava holders the time is near. First $TRVL airdrop snapshot will be in 72 hours. Smart members will share in 500,000 tokens

A Gaming Project to Have on Your Radar

Yes, gaming tokens have cooled down quite significantly after their huge run in autumn. While we don’t know if prices will come roaring back soon, it’s surely more interesting to look at new gaming projects when the overall hype has calmed down.
An interesting, brand-new project to look out for is Fancy Games DAO. Check out the thread below to learn more!

Disclaimer: With the $FNC token launching today and the overall market environment being rather uncertain, be aware of the risks involved with investing in new projects like these.