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October 26, 2021

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EllioTrades Daily Roundups

October 26, 2021

A BTC Dip for Ants and More Bullish L1 Action

Oliver Grah
Oct 26, 2021
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October 26, 2021

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Introduction

With a lot of anticipatory excitement and confidence on Crypto Twitter in the last 48 hours, it’s no surprise that we are seeing some mild dip action today. As Will Clemente points out, greed and overconfidence are still prevailing, making it more unlikely that prices will rise sustainably in the short term. Maybe we do need some more consolidation to make people nervous…

Twitter avatar for @WClementeIII
Will Clemente @WClementeIII
Can you guys stop leverage longing the dip? Thx
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1:43 PM ∙ Oct 26, 2021
648Likes42Retweets
Twitter avatar for @rektcapital
Rekt Capital @rektcapital
It would be natural price progression for #BTC to dip into ~$61600 (orange level) Holding there would be a sign of strength on the side of buyers $BTC #Crypto #Bitcoin
Image
9:54 AM ∙ Oct 26, 2021
304Likes30Retweets

The L1 Games Continue

  • What we are witnessing today in the markets is a trend that has been raging for several months now: Emerging L1s stealing Ethereum’s thunder by rolling out massive liquidity incentive programs which subsequently lead to adoption and massive pumps of the respective ecosystem projects.

  • After SOL and AVAX, it seems like this week it’s the turn of FTM, NEAR, (Harmony) ONE, MATIC, and COSMOS to catch the attention.

Source: CoinGecko
  • Two projects have recently announced massive ecosystem funds: Tron (yes, the once super-hyped L1 still exists), and NEAR Protocol. NEAR in fact more than doubled its previously announced $350 Mio fund.

Twitter avatar for @NEARProtocol
NEAR Protocol @NEARProtocol
📣 Early #NEARCON Announcement! 💥 Learn more about @NEARProtocol's $800M Global Ecosystem Fund. 🔽 near.org/blog/near-anno…
near.orgNEAR Announces $800 Million in Funding Initiatives To Support Ecosystem GrowthNEAR is the network for a world reimagined. Through simple, secure, and scalable technology, millions are empowered to invent and explore new experiences. Business, creativity, and community are being reimagined for a more sustainable and inclusive future
1:50 PM ∙ Oct 25, 2021
2,962Likes433Retweets
Twitter avatar for @justinsuntron
Justin Sun 🅣🌞 @justinsuntron
Our $1.1 billion fund will first support @danielesesta to build #occupydefi #peoplemaxi Frog Nation🐸 on #TRON and #BitTorrent chain!
Twitter avatar for @justinsuntron
Justin Sun 🅣🌞 @justinsuntron
Ok. For some reason everyone is suggesting $1.1 billion fund instead. How about we do $1,111,111,111 instead. https://t.co/xfrpfc3PfS
6:23 AM ∙ Oct 26, 2021
1,108Likes211Retweets
  • With massive incentive programs announced seemingly on a weekly basis, there is no doubt that L1 season will continue. The challenge for everyone who wants to bet on this trend is to identify the next likely mover in time and get out of the way of the unavoidable crashes which will follow the awe-inspiring L1 pumps.

  • As a general rule of thumb: When everyone on Crypto Twitter is talking about a specific project (in today’s case FTM), then it is likely not a favorable time to enter in the short term.

  • By the way, degen yield farmers on Avalanche, don’t miss out on the fresh pastures on Trader Joe. (No additional stablecoin farm incentives yet though 😏)

Twitter avatar for @traderjoe_xyz
Trader Joe (🎩,🔺) @traderjoe_xyz
Alright, it's time for the Rush 🔺 Joe Rush is live 🔺 Phase 1 Joe Rush Farms: $XAVA / $YAK / $JOE / $SPELL MIM: on Banker Joe (Double Rewards)
8:32 PM ∙ Oct 25, 2021
804Likes142Retweets

Be Ready for the Next Wave of FUD

  • When things are looking rosy, the markets have been green for many weeks in a row and everyone is feeling safe with their bull market predictions and altcoin picks, it is generally not the time to get carried away by the positive “vibes” in the crypto community.

  • In fact, these are the times when the market becomes more and more vulnerable to “disruptions” caused by unforeseen FUD storms – which always hit the crypto markets when everyone least expects it. Be mentally prepared for it and make a plan for how you will react.

Citing sources familiar with the matter, Bloomberg reports that developments surrounding SEC’s authority over stablecoin legislation will be announced formally this week by the Treasury Department.

Source: Crypto Potato

Identifying Macro Tops and Bottoms

  • With daily price action absorbing a lot of the attention of crypto traders and investors, it is critical to zoom out from time to time and look at where we find ourselves in the macro picture.

  • Most will already be familiar with Plan B’s Stock-to-Flow model (see below), which estimates the current fair value of BTC to be at around $110k.

Source: Plan B
  • There are other great data science models that can help create a mental framework for what is to come. It’s very important to never rely on one single model but instead to have different scenarios in the back of your head. Below are two models that are particularly impressive when it comes to predicting market tops and bottoms.

1. Bitcoin Price Temperature

  • This model developed by on-chain analyst @dilutionproof apparently has a great track record in predicting Bitcoin’s market tops and bottoms. If Bitcoin were to reach its hypothetical all-time high right now, the model estimates it to be somewhere between $111,000 and $143,000 – in the ballpark of Plan B’s Stock-to-Flow model. Feel free to study the model closer since it provides some striking insights.

The Bitcoin Price Temperature (BPT) is an oscillator that models the number of standard deviations that price has moved away from the 4-yr moving average. This seeks to establish a mean reversion model based on the cyclical nature of Bitcoin halving, and investment cycles. The BPT bands then establish price levels that coincide with specific standard deviation multiples to identify fair, and extreme valuations.

Source: Glassnode, created by DilutionProof

2. Top Cap Model

  • Developed by the arguably most famous on-chain analyst Willy Woo, the Top Cap Model appears to be super accurate when it comes to predicting macro market tops. Just look how nicely Bitcoin’s price has touched the red line during previous market tops…

The Bitcoin Top Cap model was developed by Willy Woo to identify market cycle tops. It is calculated by multiplying the Average Cap by a factor of 35. The Average Cap is calculated as the cumulative sum of daily Market Cap values divided by the age of the market in days.

Source: Glassnode, created by Willy Woo
  • All three models indicate that there is still ways to go until Bitcoin reaches its next macro top. At the same time, we are nowhere near the lower (aka “undervalued”) regions of the data science models, putting the current risk for new buyers into perspective…

Banks Entering Crypto #∞

  • One bank after the other is announcing plans to offer crypto services – probably nothing.

Twitter avatar for @Blockworks_
Blockworks @Blockworks_
JUST IN: Citibank is building infrastructure to accept crypto payments, CEO says. Latest by @LizBitCoyne
blockworks.coCiti CEO Fraser: ‘We’re Building the Infrastructure for Retail, Real-time Payments’ - BlockworksDespite Fraser’s certainty that digital assets will be part of the future of financial services, Citi is proceeding with caution in the space due to regulatory uncertainty.
3:59 PM ∙ Oct 25, 2021
827Likes236Retweets
  • Also, we see the trend of institutions and pension funds investing in crypto continue.

Twitter avatar for @iamjosephyoung
Joseph Young @iamjosephyoung
Absolutely huge. The Korea Teacher's Credit Union, which manages $47 billion, is investing in Bitcoin, as per local reports. The boom of institutional money into crypto.
1:31 PM ∙ Oct 25, 2021
4,624Likes745Retweets
Twitter avatar for @BitcoinMagazine
Bitcoin Magazine @BitcoinMagazine
NEW – German auction for millions in seized #Bitcoin sparks bidding 'frenzy' Demand is rising. 🌎
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2:24 PM ∙ Oct 26, 2021
181Likes39Retweets

Chainlink Coming to the Terra Ecosystem

  • The Terra ecosystem has been on a tear lately, shipping one crucial update after the other. Now, oracle heavyweight Chainlink is dipping its toes into the Terra ecosystem, bringing its invaluable oracle services to the fast-growing L1 .

Twitter avatar for @terra_money
Terra (UST) 🌍 Powered by LUNA 🌕 @terra_money
1/ Thrilled to announce that @chainlink has officially gone live with their integration of premium market data on the Terra testnet! #LUNAtics, please welcome DeFi’s most widely relied on, decentralized price oracle solution to the Terra ecosystem :)
medium.comChainlink Price Feeds Now Live on the Terra Testnet, Bringing Premium Market Data to its DeFi…Chainlink Price Feeds, the most widely relied on decentralized price oracle solution across DeFi, is now live on the Terra testnet! As the recommended oracle solution for the Terra ecosystem, smart…
3:59 PM ∙ Oct 25, 2021
2,617Likes547Retweets

GameStop Is Not Repeating Steam’s “Nokia Moment”

  • Was it the last months’ fast rise of NFTs and gaming projects (such as trailblazer Axie Infinity) or the obvious blunder of Steam – which “banned itself” from crypto and NFTs – that made GameStop jump onto the Web3 bandwagon? Maybe both, since GameStop must have realized that this is its chance to “rise from the ashes”.

Twitter avatar for @CoinDesk
CoinDesk @CoinDesk
JUST IN: @GameStop is looking to hire a “Head of Web3 Gaming” in the latest sign of the retailer’s crypto push. $GME @elitanjourno reports
trib.alGameStop Enters the Metaverse With ‘Web 3 Gaming’ Job PostThe video game store is hiring an Ethereum specialist after teasing an NFT marketplace in May.
1:33 PM ∙ Oct 26, 2021
317Likes64Retweets
Twitter avatar for @jacksondame
Dame.eth @jacksondame
steam: *bans crypto* gamestop: 😈
1:37 PM ∙ Oct 26, 2021
Twitter avatar for @ColeThereum
COLΞ @ColeThereum
NFTs are so incredibly easy to understand when you grew up playing video games… Super smash, Halo, Pokemon, Minecraft, Clash of Clans, World of Warcraft… It’s all digital characters and digital items in a virtual world. 10 year olds see the value easier than 50 year olds. 🤷🏼‍♂️
10:20 AM ∙ Oct 26, 2021
670Likes92Retweets

Sushiswap’s Highly-Anticipated NFT Marketplace Is Launching Next Week

  • We have talked several times about the need for a more decentralized NFT marketplace (ecosystem). Finally, Sushiswap’s Shoyu will take a chance at seizing the NFT marketplace crown from OpenSea starting with its launch next week. While a huge challenge, it’s going to be exciting to watch how the roll-out plays out.

Twitter avatar for @SHOYU_NFT
Shōyu @SHOYU_NFT
No more guessing wen.
Image
2:52 AM ∙ Oct 26, 2021
1,233Likes356Retweets
  • Another positive catalyst for SUSHI (and MOVR) will likely be the imminent deployment of Sushiswap on Moonriver.

Twitter avatar for @SushiSwap
SushiChef @SushiSwap
1/ Sushi is going to the moon with @MoonbeamNetwork, enjoy with an omakase 🌕
10:14 PM ∙ Oct 25, 2021
1,404Likes436Retweets

The NFT Bear Market Is on Fire

  • While we have certainly seen quite some corrective price action in NFT land as of late, there seems to be no lack of interest in “blue-chip” NFT projects.

Twitter avatar for @BoredApe1000
1K | 0001K.eth @BoredApe1000
The highest BAYC sale of 815 ETH just closed. Congrats @j1mmyeth
Twitter avatar for @ddev_
Dylan_ Ξ @ddev_
People call NFT bear market, meanwhile this gold fur bored ape sold for a record number of $3.4M (aprox. 815 ETH) @ $4160 @BoredApeYC https://t.co/t4m0MqV3nI https://t.co/0zeG4UPJGj
2:28 PM ∙ Oct 26, 2021
12Likes2Retweets
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October 26, 2021

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