Bitcoin and Crypto Market Updates (May 22nd)
The final squeeze?
I also have some NFTs to add to your watchlist!
The Final Squeeze? So last week I talked about the horrific market breadth and the rally in stocks only being concentrated in a handful of names… mainly being driven by the AI narrative. Last week the ‘’technical breakout’’ across the indexes driven by these large caps really drove retail participation last week. See below the ‘’Top 5 retail buys’’ last week.
This comes as we hit massively overbought levels in chips + at the range high deviation on QQQ.
I AM YET TO SEE ANY BREADTH! And still, without seeing any rotation into these small caps I still don’t consider this a healthy move. See below EVERY TIME we hit these levels in tech vs S&P the market experienced declines.
As discussed in the last weekly update I’m happy to flip to a bull but we need to see our invalidation points being met on ARKK, TOTAL 3 etc.
NFT’s! There are only a handful of projects I’m really interested in acquiring in this NFT bear market and here are TWO of them.
1. Taproot wizards (Not yet released) — This is a Bitcoin NFT I’m expecting to be released this year. There’s a ton of history behind this project and the guys behind it are impressive. I won’t write a whole piece on it here but give them a search and review what the projects are all about and feel free to hit me up in Discord with any questions.
2. OCM Genesis — This is Metagoods first collection and is currently on ETH — Owning one of these ETH NFTs grants you a BTC ORDINAL so although the floor is high you do get the two NFTs on each chain. https://www.metagood.com/collections
I’m going to pick up some OCM soonish… I just want to wait for some further market confirmations listed above and I’ll update in the discord if I take the plunge.
New NFT Token Standard could be a Game Changer
ERC-6551 is set to revolutionize the NFT space. While ERC-721 established the concept of unique digital assets on the Ethereum blockchain, ERC-6551 takes it a step further by creating token-bound accounts for each NFT. This allows NFTs to own assets, interact with applications, and even represent real-world entities. With increased functionality, security, and interoperability, ERC-6551 opens up new possibilities in gaming, DeFi, identity verification, and more. While ERC-721 remains important, ERC-6551 offers exciting potential for the future of NFTs and the blockchain ecosystem as a whole.
Bitcoin Miami conference attendance down 50% this year
The world’s largest Bitcoin conference, Bitcoin 2023, took place last week in Miami Beach, but attendance is down by half compared to last year due to the ongoing “crypto winter.” Approximately 15,000 attendees are expected, compared to the 35,000 who attended in the previous year. The conference features notable speakers such as U.S. presidential candidate Robert F. Kennedy and author Michael Lewis as well as the crypto household name Michael Saylor. The decline in attendance is attributed to budget cuts and the impact of the cryptocurrency market downturn. Despite the lower turnout, the conference still offers a platform for networking and in-person interactions within the digital asset industry.
Ripple has new CBDC Play… which has no need for XRP
Ripple has unveiled a new platform dedicated to central bank digital currencies (CBDCs), offering a comprehensive solution for central banks, financial institutions, and governments to explore and issue CBDCs. The platform enables holistic management and customization of fiat-based CBDCs throughout their lifecycle, from issuance to transaction and distribution. Notably, Ripple’s CBDC platform and its previously announced private ledger for CBDCs are built on the XRP Ledger, but they do not require the use of XRP. The platform aims to address the needs of central banks and governments as they strategize and implement CBDC initiatives. Ripple’s move comes amid increasing global interest in CBDCs, with around 90% of countries reportedly exploring their own digital currencies. Alongside this development, Ripple has been active in mergers and acquisitions, recently acquiring Metaco for $250 million.
Apple allows Axie Infinity to launch on the App Store
Big move for the past Game-Fi giant! Axie Infinity’s Origins Card game, a blockchain-based gaming platform, has received approval from Apple to be available on the App Store in Latin America and Asia. Players in countries such as Argentina, Colombia, Mexico, Indonesia, and Vietnam can now download and play the game on their iOS devices. Additionally, users in these regions can utilize Axie Infinity NFTs within the game. Notably, new players will be provided with a non-NFT starter character, eliminating the need to purchase an NFT right away. This development follows Apple’s previous restrictions on the usage of externally purchased NFTs and its revenue-sharing policy for app developers. In related news, Sky Mavis, the developer of Axie Infinity, has also announced the launch of Mavis Market, an NFT marketplace.
Prosecutors look to reclaim FTX Money paid to US Lawmakers
The Department of Justice (DOJ) has directed lawmakers who received political donations from FTX, its subsidiaries, and employees to surrender the funds, and several Congressional campaigns have complied. Rep. Bob Latta of Ohio voluntarily transferred the $2,900 he received from former FTX executive Ryan Salame. A campaign supporting Lori Chavez-DeRemer, also from Ohio, surrendered the funds as well. The donated funds are intended to compensate individuals who were defrauded. Lawmakers had previously pledged to donate political contributions received from FTX and its founder Sam Bankman-Fried. The fate of the broader recovery efforts, including funds donated to charities and nonprofits, remains unclear.
Tips To Start Building Your Own Trading Algo
Last week we talked about Algo trading and the potential of implementing it. Today as promised I’m going to provide essential tips to help you embark on the journey of algo trading.
Building your own trading algorithm can be an exciting and rewarding endeavour. It allows you to tailor your strategies to meet your specific trading objectives and leverage the power of automation.
These are some tips to help you get started with it:
Define Your Objectives and Strategy:
Start by clearly defining your trading objectives and strategy. Determine the markets you want to trade, the timeframes you will focus on, and the types of trades you aim to capture (e.g., trend-following, mean reversion, breakout). Defining your objectives and strategy will serve as a foundation for developing your trading algorithm.
Acquire Programming Skills:
To build a trading algorithm, you need programming skills. If you are not already proficient in programming, consider learning popular languages like Python or R, which are commonly used in algorithmic trading. Alternatively, you can collaborate with a skilled developer who can translate your trading ideas into code.
Understand Market Dynamics and Data Sources:
Gain a deep understanding of the market you are trading. Study price patterns, market dynamics, and the factors that influence price movements. Familiarize yourself with various data sources, including historical price data, fundamental indicators, news feeds, and sentiment analysis. High-quality and timely data is crucial for accurate decision-making within your algorithm.
Design Your Algorithm and Develop Rules:
Based on your defined strategy, design the structure of your algorithm. Determine the indicators, signals, and rules that will drive your trading decisions. This may include technical indicators, moving averages, support and resistance levels, or other quantitative factors. Document your algorithm’s rules and logic to ensure clarity and ease of implementation.
Backtest and Validate Your Algorithm:
Backtesting is a critical step in the development process. Use historical data to simulate the performance of your algorithm and assess its profitability and risk management capabilities. Ensure that your backtesting methodology accurately reflects transaction costs, slippage, and other realistic trading conditions. Validate your algorithm’s performance by comparing it against benchmark indices or alternative strategies.
Implement Risk Management Mechanisms:
Effective risk management is vital to long-term success. Incorporate risk management mechanisms into your algorithm to control potential losses. This may involve setting stop-loss orders, implementing position-sizing strategies, or using dynamic risk-reward ratios. A robust risk management framework helps protect your capital and preserves the integrity of your trading strategy.
Continuously Monitor and Optimize:
Markets are dynamic, and your algorithm needs to adapt. Regularly monitor the performance of your algorithm in real-time trading and make necessary adjustments based on market feedback. Consider refining your algorithm by optimizing parameters, introducing new rules, or exploring additional data sources. Continuously learning and improving your algorithm is key to its long-term effectiveness.
Stay Informed and Evolve:
The financial markets and technology are continually evolving. Stay updated with the latest trends, industry news, and advancements in algorithmic trading. Engage in communities, forums, and educational resources to learn from experienced practitioners. Embrace a mindset of continuous learning and adaptability to stay ahead in the ever-changing trading landscape.
Building your own trading algorithm is going to test your commitment and requires effort, dedication, and a thirst for learning. However, the benefits of creating a well-designed and carefully tested algorithm are best.
By developing your own trading algorithm, you gain control over your trading decisions, leverage automation for speed and efficiency, and potentially unlock new opportunities for profitability.
So, I encourage you to roll up your sleeves, equip yourself with the necessary skills and knowledge, and embark on this exciting journey of building your own trading algorithm. The possibilities are boundless, and the potential for success awaits you. Start today and chart your path to algorithmic trading excellence.