Weekly Crypto Report

July 11, 2021

Good morning/evening/night guys. As every Monday, find here your weekly dose on market analysis, the most relevant industry stats, and our best tips to profit from this exciting market while learning from it!

Bitcoin

Great weekend for Bitcoin, bounced nicely on the confluence of horizontal support and wedge channel. Now pushing again looking for the breakout. But I would continue carefully until we have a bullish confirmation.

As commented last week, the bullish confirmation would be given buy breakout and consolidation on the $35,500 - $36,000 range. Which is the key horizontal resistance playing out for a month already.

Big Caps index

Taking a look into the Big Caps Index we can see how the drop is slowing down and we might fund a local bottom here, on the 28,000 sats support. Tiny breakout for now on the local downtrend resistance but it's a start. Let's see from here, no reasons to be super bullish, so remain cautious but is not looking either bearish.

A bounce from here would enable a new bullish wave with a target on the 33,000 sats range. An average increase of +20%. So don't sleep on it and let's keep an eye here.

Mid Caps index

Similar scenario for the Mid Caps Index, after the breakout on the main wedge it struggled to consolidate and it tested the key 4,700 sats support which is one of the most relevant supports.

What I'm mainly tracking here are the possible inverse Head and Shoulders. The structure is perfect so far. And If we close the daily candle as it's looking right now, with a dragonfly doji it will be primed for a bounce tomorrow.

Crypto Stats

Stablecoins supply on the rise

Stablecoins supply is on the rise since the launch of USDT. In the year 2020, stablecoins supply had exponential growth of 404% increase from $5.8 billion to $29.22 billion. In the current year, as of 11 June 2021, stablecoins supply has been increased to $109.50 billion.

One of the main reasons for this increase is the increasing demand from people as they like to trade with stablecoins more instead of Bitcoin now. And another major reason is the people transferring their profits from Bitcoin and other cryptocurrencies to stablecoins in the current year.

Bitcoin Historical Corrections

Despite being one of the world's best-performing assets, Bitcoin has suffered plenty of massive price drops. Government banning Bitcoin and hacks have caused many crashes.

After achieving a +$64k price three months ago, it has dropped around 55%. BTC experienced the biggest correction of 87% when it dropped from $1163 to $152 from Nov-2013 to Jan-2016. But the good part is it keeps pumping far higher than its corrections which keeps investor interested in it.

Recent fundraising by blockchain startups

Mintable: The Mark Cuban-backed non-fungible token (NFT) marketplace Mintable has raised $13 million in a Series A funding round to produce more NFT products to enhance user interaction.

Nansen: Nansen, an analytics platform for blockchain that unifies on-chain data with disparate market signals has raised $12 million in Series A funding led by Andreessen Horowitz (a16z).

Coincover: Cardiff-based crypto security startup Coincover has raised $9.2 million in a Series A funding round. The company is building the world's safety standards for cryptocurrencies.

Top 10 coins mentioned on Twitter in last week

BTC: Bitcoin which again remained sideways last is on the top of the list with almost 1.8 million mentions on Twitter.

DOGE: Doge again had a nice hype last week after several tweets from Elon Musk and was mentioned more than 495k times on Twitter.

CAKE: Continous new project listing on Pancakeswap is keeping it in 3rd place with more than 461k mentions on Twitter while token itself remains sideways.

Skin in the game

Behavioral Trading Biases

Behavioral biases affect your trading like your routine decisions. It is a natural phenomenon but you can train yourself to avoid them. In the presence of these biases, you usually trade on the basis of personal liking or disliking or based on false assumptions and you start making decisions on the basis of your instincts or gut feelings instead of technical or fundamental analysis of an asset.

Sometimes individuals even don't have an idea if they are affected by biases or not but here we will let you know various types of trading biases you need to avoid.

  • Overconfidence bias

Overconfident investors think that they are fully in control of their investments when actually they are not. They were unable to correctly analyze the technical and fundamental sides of an asset and indulged in its trading by overestimating or underestimating some aspects.

  • Self-attribution bias

Self-attribution bias makes you believe that your successful trade is the result of your great analysis and your losing trade is the result of some external market factors or manipulation.

  • Status quo bias

Crypto trading is dynamic in nature. There is no guarantee the strategy or trading plan that is working today will keep working always. Traders who keep using the same strategies go into status quo rather keep improving or changing the strategy and end up making losses.

  • Familiarity bias

Traders like to invest and trade the assets belonging to their country or related to their field. Like some crypto investors like to trade privacy coins only when they can make more profits by trading other coins.

  • Confirmation bias

Sometimes a trader develops a trading idea and for its confirmation starts giving higher weightage to some news related to that asset or increase in its volume. They only try to look for the positive side and disregard the information that rejects their idea.

  • Representativeness bias

A trader develops this bias when he or she makes a decision about a trade based on its past performance. It can be a setup that gave him positive results in the past and also it can be an asset that gave him good profit in the past and still it's moving up. You should evaluate every trade separate from the previous one.

  • Gambler’s fallacy

Gambler’s fallacy is also a kind of representativeness bias where traders do not see a bullish setup for an asset but will still take that trade because the same asset gave them the profit in recent trade.

  • Attention bias

Some traders tend to buy those coins more that came into their attention because of its news in the media or high trading volume or due to its higher return in a day.

  • Negativity bias

This happens when you start looking more into the negative sides of your trade. As a trader, you need to look on both sides and evaluate & adjust your strategy according to the situation.

Now you know all the biases that can affect your trading. You can easily evaluate yourself if your trading style is biased or not and can adjust it to increase your trading performance.

Have a nice day, see you soon!Rand