Weekly Crypto Report

October 31, 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

Checking into Bitcoin we can see how it broke up the local bull flag channel and despite the shakeouts and retest of the horizontal support it's recovering nicely, all the sales are being absorbed quickly printing strong daily candles. Now pushing on the horizontal resistance again at $62,500.

It continues looking really really strong and bullish. I don't see reasons to sell or short here. Really strong and bullish consolidation. The volume is also increasing during the last few days.

Attending to the Bitcoin dominance we can see how is revisiting the level we commented during the last week on the local uptrend support here at 44%.

A breakdown here would be ultra bullish for altcoins, let's see how it flows because Bitcoin is looking strong too. Anyway if bounces softly, we can have altcoins and Bitcoin rising together as happened last month few times:

Big Caps index

Meanwhile, the Big Caps Index is struggling with the horizontal resistance we mentioned on Friday but holding the key levels and keeping the bullish trend alive too. Looking really solid, we might have some corrections on small timeframes, but nothing to worry about. Remains full bullish:

Mid Caps index

The Mid Caps Index looking weak here but looking for the breakout of the main falling wedge still. For now not confident...mid caps need the bigger ones to lead the way first.

I see no point tracking the mids for now, too early:

Crypto Stats

Bitcoin On-Chain Monthly Volume in 2021

Bitcoin on-chain monthly volume reached an all-time high at $548.93 billion in October-2021 after making a bottom at $212.22 billion in June-2021.

The last highest on-chain monthly volume of $446.86 billion was recorded in April-2021 when BTC touched 65k and in Oct-21 Bitcoin again reached a new ATH of $67k while volume is $100 billion higher than the one recorded during last ATH.

This increase in BTC price and volume suggests an increasing adoption, not only from retail but also from institutions as well.

Ethereum Burning Fast

Token burning on Ethereum was introduced with the EIP-1559 upgrade on August 5 this year, with an aim to make ETH less inflationary than it was before.

Since activation, ETH 704,725 have been burned, making up more than half of the new tokens issued over the same period.

This is causing a negative supply rate a few days during the period on the Ethereum network which is a very bullish thing for a crypto asset.

Top fundraising by blockchain startups in last week

Alchemy:Alchemy, one of the leading infrastructure providers for blockchain and web3, has raised $250 million in its series C funding round led by z16z, giving it a valuation of $3.5 billion.

Sino Capital:Sino Global Capital, a crypto venture capital firm led by Matthew Graham, has launched a $200 million fund with backing from FTX in the last week.

Coinlist:CoinList, a token listing platform, and a crypto exchange has raised $100 million in a Series A funding round and attained unicorn status.

Top 10 coins mentioned on Twitter Last week

BTC:Bitcoin is on the top of the list with more than 10.9 million mentions on Twitter last week while it traded in the range of $63k to $57k during the week.

SHIB:SHIB is in 2nd place with more than 4.4 million mentions on Twitter while its price remains volatile and gained more than 700% during the week.

ETH:ETH is in the 3rd spot this week with 2.5 million mentions on Twitter while its price reached a new ATH of $4,460 during the last week.

Skin in the game

Five important psychological factors for a trader

Crypto trading at first glance looks too easy for a new person and he might manage to make profits in a few trades by chance or due to a bullish market but in the long run, he will have to learn the technical, fundamental, and psychological sides of the trading. The Technical and fundamentals sides are easy to learn but the psychological side of trade management is where most of the traders fail. There are various psychological factors that have a direct impact on trading and we are going to discuss some of the most important ones today.

  • Fear

Fear is the single most important factor that makes a trader successful or broke. Fear can affect trading in various ways like you might not open the trade at all due to fear of loss and on the other hand, you might book the profit too early due to fear of loss. The worst scenario is when you tend to book the losses too early and don’t let the setup play. You need to distinguish between conservatism and fearfulness. Being conservative in trading is good because a conservative trader is skeptical about everything he hears but he still takes action when the study confirms a good trading opportunity for him. The fearful trader, on the other hand, is doubtful about his own analysis but also of others' opinions.

  • Greed

Greed can be your worst enemy in trading which might result in turning a profitable trade into a losing one. Traders want to take advantage of every cent of price movement when they are already in profit but when the price reaches a high supply zone it can drop fast. Overcoming greed is not easy but using tools like Fibonacci price extension ratios can help you in determining the profit targets and you need to book those profits when the price reaches there. Greed, if not controlled can lead to frustration and might result in overtrading. Learn to control greed rather than let it control you.

  • Euphoria

Euphoria is a creature that promises unlimited wealth and limitless profits when a trader starts his crypto trading career. He has seen all over the internet people making millions in crypto trading and he enters into it with the same mindset. He might make some quick money from crypto trading at the start by chance but continuing with this mindset will ultimately burn him badly. The key here in trading is that if you want to stay profitable you should not expect anything good from the market and the only way to make money from it is through proper analysis and a positive mindset.

  • Panic

Panic is the opposite of euphoria. A panicked trader only sees losses in the market which decreases its ability to stay profitable. The volatile market tells a trader if he is panicked or not as a panic trader might close the trade due to sudden drop for some reason without considering the facts and the analysis he had done before entering the trade. On the other hand, he might book profit early when panicked. This only results in losing trading confidence and if it remained for too long it can ruin your trading career.

  • Regret

The regret of losing or missing a trade is also one of the factors that can affect a trader’s mindset. As it may result in overtrading which is always not a good thing for a trader. Regret can demotivate you and can also shatter your trading confidence which can make it difficult for you to stay profitable in the long run.

We have discussed various psychological factors above that have an adverse effect on a trader’s mindset but the question is how all these can be avoided or mitigated? The answer is simple “Plan the Trade and Trade the Plan”, as being disciplined in trading is the only way to sustain.

Rand