¶ Intro
The interesting thing here, obviously, this chart has not fallen nearly as much as Bitcoin dominance had, and so as we think, what is the implication here, what is the discrepancy between these two charts actually telling us.
It's telling us.
That all of the outperformance, or let me say it this way, all of the decline in Bitcoin dominance is due to the outperformance of ETH and XRP.
This episode is brought to you by Treasure. Treasure makes beautifully crafted hardware wallets that make it easy for you to safely store your cryptocurrencies. I'm a big believer in self custody. I've been using hardware wallets for years and Treasure was the pioneer of hardware wallets and they started
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can hold your hand through the process. And if you use the code thinking Crypto all one word, you can get five percent off your purchase of a Treasure device. So to learn more about Treasure and all their great devices and services, visit the link in the description. Hey, folks, welcome into the Thinking Crypto podcast. I'm your host, Tony Edward, and joining me today is Caleb Franzen, who is the founder of Cubic Analytics. Caleb, great to have you back.
On Tony's been tradition.
Man, Every like four to six weeks we rip another one of these and they're always a blast.
So really looking forward to this absolutely. Man.
We've been talking since the beginning of the bitcoin bull market, like twenty twenty three, right, and we've ran up over the past couple of years, and it seems like this is the year of the.
Blow off top.
What are your thoughts on Bitcoin's recent move and do
¶ Bitcoin's move to new ATHs
you see a blow off top coming by the end of the year.
This move definitely happened a lot faster than I expected. I know, I was very defensive, if not leaning slightly bearish during March and April, but I laid out all the criteria right I said, if we get back above the twenty one, the fifty five, and the two hundred day moving average, then I'm gonna flip super bullish again.
And that was right around eighty five to eighty six thousand, so obviously getting to one hundred and twenty three k I think, you know, one of my superpowers as an investor, as an analyst is being able to change my mind based on objective facts, objective reality, so we can fight trends or we can align with them. And thankfully, we've broadly been in a super strong uptrend, at least for bitcoin for quite some time now, so it's been very easy to be bullish to have our upside price targets.
I've been talking basically since the second half of twenty twenty three saying that my cycle price target is one hundred and seventy five thousand for bitcoin, and it's been slow and steady. We've, you know, just keep making these higher highs and higher lows, but we're getting closer and closer month after month after month. Right, So look, I think this this latest breakout, you know, it's it's been exactly what we could have hoped for in a lot
of ways. I think the funny thing about it, oddly enough, is like a lot of investors don't seem too excited or too grateful, right, It's just like, yeah, like bitcoin's that, you know, one hundred and eighteen thousand, one hundred and nineteen thousand. You know, we're getting I'm still getting into debates on Twitter spaces people talking about how bitcoin is
a Ponzi scheme. It's just like they've lost a plot so much and they refuse to actually look at what's really taking place here in this ecosystem.
But that's their loss, not ours.
Yeah. Well, put and you know you mentioned you you reserve the right to change your mind, and we have to because the data can change, right, like for example, black Swan events happen. I would consider the tariff crash that took place in Q one into Q two eight blocks one event. No one saw that coming, right, and that kind of changed the whole dynamic, So you have to adjust your timelines and like you said, look at the moving averages and so forth.
Yeah, and you know, I think that's one of the things, right, I say it all the time. It's okay to be wrong, it's just not okay to stay wrong. So you have to have a rules based system to change and modify your perspectives based on actual reality. And so for me, using stuff like moving averages, the Williams percent are looking
at bullish, embarrassed, our side divergences. That's my bread and butter, right, and so I'm going to keep kind of looking at those data points and kind of letting things carry from there. I think one of the amazing things that we've actually been seeing in this market for the entire ecosystem is the fact that we continue to see stable coin market cap rising, rising, rising, but at the same time we're
actually seeing stable coin dominance falling really drastically. I brought some charts with me, but I just want to explain this and kind of set it up.
A little bit.
What that's telling us is that new stable coins are being issued and minted, but that investors are not keeping them in stable coins. They're being automatically deployed into let's call them speculative assets, basically banking on more upside in this market. So let's go ahead and talk about it, right. This is the chart right here. This is looking at
¶ USDT Stablecoin Dominance
US plus USDC in green, so that's total market cap, and then their respective dominance combined in blue. And so obviously, basically since that April level, which was basically the peak of the tariff scare, if you will, we've seen really good things take place. Let's go ahead and prove it if we look at that same exact chart and then
add on total crypto market cap excluding stable coins. Let's look at when that peak actually occurred, right, It was at the local lows in the total crypto market, and really good things have taken place. The other thing you'll notice here right is stable coin dominance is actually making lower lows right here right now. So that's telling us that this recent down trend in stable cooin dominance is
really intact. And obviously a down trend in stable coin dominance is exactly what we want to see here as investors.
So yeah, absolutely, you mentioned tether dominance falling right, staple
¶ Bitcoin ETH XRP Dominance
cooin dominance falling, but also bigcoin dominance has been falling, right, and that correlates with these rallies that we've seen historically.
It has.
So I actually brought two awesome charts just to talk about this exact topic, even though we didn't plan this ahead, Tony, But look, this is bitcoin dominance right, And so obviously one of the really interesting things about this recent acceleration to the upside in the overall crypto ecosystem is the fact that bitcoin dominance is falling here. And so I think, based on this kind of dynamic, my general target is we're probably going to return right back to the sixty
two percent level for bitcoin dominance. Can we fall lower than there? Absolutely, could we rebound on that level. That's actually my expectation, because we could see former resistance has already flipped into support. So again, if we're going to be objective, we need to recognize that this is valid potential support here, and that would generally be my expectation. The interesting thing that I wanted to show here, Tony is if we look at this chart, which is combining
the dominance of bitcoin ethereum and XRP. The interesting thing here, obviously this chart has not fallen nearly as much as bitcoin dominance had, and so we think, what is the implication here, what is the discrepancy between these two charts actually telling us. It's telling us that all of the outperformance, or let me say it this way, all of the decline in bitcoin dominance is due to the outperformance of Eth and XRP, and so for a lot of investors
that's actually really good news. But for a lot of investors who are really far out onto the risk curve and what we could consider small cap all coins, this decline in bitcoin dominance is not actually helping them, because what we're seeing is that almost all of the outperformance in the all coin ecosystem is really just coming from ethan XRP.
H Wow, that is interesting. I've never looked at the combined dominance like this, and that is very fascinating that those two assets are doing a lot of the damage, so to speak.
Well, look, I always try to come with some unique alpha here, Tony. So it's literally my job to find these crazy little correlations and market dynamics and try to bring them to as many people as possible.
So, you know, hopefully that's what we're doing here today.
Can we look at a bitcoin chart and if you
¶ Bitcoin analysis & Price Prediction
can tell us what you're looking at, you know, could this move right now lead us to a local top and then a continuation into a blow off top into Q four.
So perfect, let's do it.
Let's go ahead and talk about my actual targets here for bitcoin based on this recent breakout. First of all, I want to draw look, I use very simple methodologies here, right, We're basically just going to be using a Fibonacci extension
in logarithmic scale. I'm going to be taking that Fibonacci from the January of twenty twenty five highs, so those April seventh lows, and I'm going to make sure that I have my Fibonacci levels based on logarithmic scale, not linear, because Bitcoin is in a logarithmic uptrend, and so based on that alone, that one sixty one point eight percent extension gets us to one hundred and thirty eight thousand.
You'll also notice that that is also basically equivalent to the measured move of this bullflag breakout that we've just achieved. You might be saying, well, Caleb, this just looks like a lot of hindsight bias.
Guys.
I was talking about this regression bullflag in real time as we were forming it, before we even broke out. So this has been a very consistent message that I've been sharing both on x on substack with premium members of Cubic Analytics, on my live stream, so on and so forth. Now, let's just add one more target to the upside, and we'll look at the two hundred and sixty one pointy percent extension in logrewdthmic scale. That gets us to two hundred and two thousand, six hundred and
fifty roughly. And so you know, again the cycle target that I've been talking about has been at minimum one seventy five, and that's by basically doing that same exact stylistic approach, drawing a fibonacci from those twenty twenty one all time highs to the twenty twenty two bear market lows in log rewthmic scale, we get to.
One seventy four and change.
Right, So I've been saying, look, I'm willing to entertain higher upside price targets. Probably not too much higher, but it's definitely possible. And that's kind of how we get there, right, So we can look at one thirty eight to one thirty nine for the one sixty one point eight percent extension, we can look at that bullflag getting us to basically one forty seven, and then we can look at the two sixty one pointy percent that gets us to around
two hundred thousand. So we're getting a lot of confluence here in terms of how these different indicators are on different timeframes are all coming together and it's just fantastic.
Obviously we don't have a crystal ball. Obviously no one can call the exact top, but these are using it. You said, the Fibonacci model, And are you anticipating and this is a hard thing to answer. You know, a timeline wise that this end wraps up in Q four or it might bleed into like twenty twenty six Q.
One, like you said, we don't have an answer for that, right, so we can speculate. The funny thing about it is when I first came out and shared my one hundred and seventy five K cycle price target, I think that was in July or August of twenty twenty three, we're trading right around thirty thousand dollars per PTC and a lot of people are saying, is that your price target for the end of this year, which was twenty twenty three? Is that your target for twenty twenty four? And I
was like, guys, it's a cycle price target. I have no idea when the cycle is going to end. If anyone else has a crystal ball, please let me know I'd love to see it.
So look, I have absolutely no idea.
I think there's been this whole debate about whether or not we're actually going to follow kind of that four year cycle kind of dynamic, and I've always said, like, look, you know, the four year cycle has been the easiest, simplest, and arguably one of the most effective models that we
can actually use. But you know, this time really is different, and you know, we can point to a variety of different data points that show that this time is different and how last time was different than any time before.
That as well.
Right, so each cycle is always going to be a little bit different. The four year cycle is interesting. It gives us a really valid blueprint if you want to follow the four year cycle.
Though.
I think on average bitcoin peaks around sixteen to seventeen months after the having, so that basically puts us in August to September maybe October for the cycle peak.
I'm looking at all.
The economic data, I'm looking at the FED, who's probably going to be cutting rates in the back half of this year. I'm looking at everything taking place, and I'm saying, look, all I see are higher highs and high lows. All I see is corporate earnings on the rise. All I see is risk appetite in the stock market doing really well. All I see is bitcoin breaking out. Why am I going to try to put a limit on when the party is going to end?
Right?
If everyone's having a good time, hot girls are showing up, all the people are coming in with new bottles of tequila, Let's keep the party going, and let's keep make sure that that the neighbors are fine. Right, And so far we still kind of have that dynamic. So I have no idea when the cycle is going to end. I have no shame in admitting that. If anyone does know when it's gonna end, please let me know.
I'd love to hear it.
Yeah, for sure. That is such a hard thing to answer and to predict. And like you said, we don't have a crystal ball. And I often tell people if they do have a crystal ball, just tell me the winning lottery numbers next week. Yeah, I could become a.
Millionaire exactly exactly.
¶ Altcoin market analysis
How about you know, total all coin market? How what are you seeing on that front? Because a lot of people hold all coins, they don't necessarily hold bitcoin.
I think that you know it's been no secret that Bitcoin has been leading this breakout. We've been seeing bitcoin dominance pull back, but from a structural perspective, bitcoin itself is what's really leading the way here this cycle, right. And so what's really interesting about this chart is we're looking at total crypto market cap again excluding USDT plus USDC, right, so we're basically just looking at the actual uh cryptocurrency
ecosystem excluding stable coins. What's interesting about this is it has actually yet to make new cycle highs. And so when we're looking at Bitcoin's price structure, which again looks like this, when we achieve this breakout, really good things have happened. We've gone from one hundred and twenty three thousand, excuse me, from one hundred and twelve thousand to one hundred and twenty three thousand in a.
Matter of days.
Right, And so as we're looking at the total crypto ecosystem, now, if this is actually going to follow in the footsteps of bitcoin itself, then we should see this breakout. We should have it stick the landing, we should achieve that extension. Maybe we kind of produce one of those classic breakout retest rebound types of setups where we get some extension up into this range, we come back in, we retest this green level, and then we rebound again to new
cycle highs. I also want to highlight here we're looking at the twenty one, the fifty five, and the two hundred day exponential moving average. We have clear proof right here, right now that we have a full bullish formation where price is above the twenty one, the twenty one is above the fifty five, the fifty five is above the two hundred. All three of those emas have a positive and rising slope. That's very different than the dynamic that was occurring here when we were in a down trend.
That's very different than the dynamic that was taking place in the middle of last year as well. It's much more reminiscent of the dynamic that was taking place in Q four of last year. It's much more representative of the dynamic that was taking place at the end of twenty twenty three in the beginning of twenty twenty four. So what we have here statistically is an uptrend. And again, as investors, we now have a choice. We can acknowledge that this uptrend exists, it is intact, and we have
a choice. We can align with it or we can fight this uptrend, and I'm gonna choose to align with it every single time. And what this is telling me is that whether or not Bitcoin outperforms everything else, whether or not Ethereum keeps outperforming BPC, you know.
Let's see.
All I know though, is that good things should happen for the ecosystem as a whole. And we don't really need to overthink this too much. We just need to have the exposure.
That's it.
Absolutely, So we are certainly in bull market territory, and bitcoin of course leads to market, so we can expect to see that fallow Bitcoin as a continues to move.
Up exactly, Tony, I actually forgot. I have another chart on this as well, taking it kind of a step further. This is actually looking at total three excluding stable coins. So obviously total three is looking at total crypto market cap excluding Bitcoin and excluding ethereum, and then manually I'm taking.
Out USDT and USDC.
So obviously this is not back at those cycle highs yet, right, but we have this kind of intermediate term base here where we're also trying to achieve that structural breakout and basically make new six month highs guys. Objectively, there's nothing bearish whatsoever about making new six month highs, new six month highs.
In fact, new highs.
On any timeframe is representative of an uptrend during that timeframe. So if we're making new six month highs, that's telling us we're in a six month uptrend basically. So you know, again, really good things should take place here. And if we do achieve this breakout, if we stick this landing, then the assumption here, the bias should be that we should
return back to these cycle highs. So we should go from basically six excuse me, we should go from basically seven hundred and fifty billion to almost one trillion in total,
three minus stable coins. And I think, you know, for a lot of investors, that's great news, right, whether or not those all coins do outperform Bitcoin, whether or not they do outperform Ethereum or XRP, it's just telling us, look, we're in an environment where a rising tide is going to lift all boats, and things should go pretty well from.
Here, absolutely.
And I like to remind people just look at what happened in Q four of twenty twenty four, because you know, sometimes people they have short memories and it's almost like what have you done for me lately? And it's like when did you buy did you not buy the bloody bear market? And you've been riding to wave up right with bitcoin, but unfortunately some people don't. But it's like, hey, what we experience in Q four twenty twenty four, We're gonna see that plus more.
I hope, so you know, I mean, look what, I'm always going to reserve my right to change my mind if we see bitcoin or total minus USDT minus USDC fall below those moving averages very similar to what was occurring in February and March of this year. I'm gonna sound a lot more defensive when I'm on your podcast next time if everything.
Is kind of like up that way.
But so long as we have this dynamic right here right now, in my opinion, that's irresponsible to be bearish. I mean, I'm looking at the sign behind you. We're guys, we're trading at one hundred and nineteen thy two hundred and.
Five for bitcoin.
I mean, come on, let's be let's let's show some gratitude and excitement here, right.
I mean, this is what we've been hoping for for a long time.
Absolutely well, put, let's look at the individual all coins
¶ Ethereum analysis and price prediction
such as etherorem it's it's been pumping this morning. What are you seeing there?
So the message that I've been sharing with premium members of Cubic Analytics is this structure here for eth BTC. So you'll notice we are now making new multi month highs on ethereum relative to Bitcoin.
This is a massive, massive breakout here.
And am I going to interpret this as oh, Ethereum is now outperforming Bitcoin, so I'm gonna sell my bitcoin and rotate that into ethereum. I'm not going to do that because to me, this still looks like a much longer downtrend right But it does tell me that investors, if they're looking to reallocate new care apital into the market right here, right now, risk is more favorable towards
Ethereum than it is for Bitcoin. And as someone who leans towards being much more of a bitcoiner than a crypto guy, you know, I'm willing to admit that and acknowledge that. But here's why the strongest parts of the bull market occur when eth is outperforming Bitcoin. The strongest parts of a bull market occur when bitcoin dominance is falling. So just because the majority of my portfolio, seventy percent of my net worth and more is in bitcoin, I own zero ethereum, I own zero XRP, but I am
rooting for Eth to outperform bitcoin. I am rooting for XRP the outperform bitcoin because that tells me that my bitcoin is also going up tremendously.
Right.
And so look, now that we've achieved this breakout in ETH PTC, the message I've been sharing with premium members of Cubic Analytics, I'm happy to bring the off with your audience, Tony, is that we should probably go back to the year to date highs here from January of twenty twenty five. So you know, that's pretty juicy upside here on a relative basis, I think we're talking basically
about thirty five forty percent basically to the upside. And look, let's talk about Eth on an absolute basis relative to the US dollar.
I think if we want to look at.
The trajectory of ETH right here, right now, let's draw a Fibonacci from basically those December of twenty twenty four highs to the April seventh lows, and we're going to keep this actually in linear scale, because obviously this has not gone through some logarithmic function over the last four years, right, This has really just been this massive long term consolidation phase here.
But that one.
Sixty one point eight percent target is measured at basically five thousand, eight hundred on the price of ethereum. I don't know anybody in their right mind would be disappointed if ethereum was trading at five thy eight hundred. The really interesting thing about this, guys, if we add on one additional layer here and also put a Fibonacci on the twenty twenty one highs to the twenty twenty two lows, that one hundred and twenty three point six percent level is trading at the exact same price.
So what does that tell us?
It means we have a lot of confluence at fifty eight hundred as an actual price target. We don't just have one data point, we have two data points using two different timeframes, but the same indicator. And so look, you know, that's a really speculative bet that we're.
Going to get the fifty eight hundred on eath.
But if we keep seeing market dynamics like we've been seeing over the course of the past three months. I don't know how you could call that unreasonable? Is it?
Is it bold? Absolutely, I'm trying to be bold.
But I also think that based on actual objective data, it's a valid price target.
I'm an ETH holder, so I would be very happy with that. I'm curious, do you think there's potential now? And it may be a low probability of even going higher, touching higher levels on the Fiminacci.
Model, probably, But you know, maybe your audience has kind of gotten a flavor for how I do things. I like to really take things one step at a time, Right, So let's first get the fifty eight hundred if and when we get there, let's all pat ourselves on the back, let's pop a bottle of champagne, and then we'll start to look at new price targets. Right, But for right now,
all I'm comfortable to say is fifty eight hundred. It's also why I look, you know, it's also why I'm only saying let's get back to those year to date highs for e f BTC. You know that even still feels very bold in and of itself, right, So again, I just want to take these things one step at a time.
Yeah, absolutely, and great perspective you shared on you know, being primarily a Bitcoin holder, but rooting for the other all coins and looking at how the market is moving overall.
¶ XRP analysis and price prediction
What about XRP.
What do you got there, dude, I got some good stuff on XRP. Rather, I know, I know you and your audience are gonna are going.
To absolutely love this.
So the message that I've been sharing with premium members of Cubic Analytics is we were, you know, on the way towards producing this higher low here, which was very different than the series of lower lows, right, So objectively,
that's a trend change. And this overall price action, you know, I know, we basically did nothing for about seven months on the aggregate, but you know, this was a really strong consolidation when the rest of the all coin eco system was really bleeding out right, And so the fact that this really just had a lot of that sideways price action, sellers were really getting exhausted, right, And so not only did those sellers get exhausted, but then the
buyer started to really come back into control. The thing that we're looking at here is the anchored volume weighted average price from those year to date highs which were obviously new multi year highs. And look, I told premium members of Cubic Analytics, I'm not sure what's going to happen when we get to this level. We were trading back down here at the time. I acknowledge though that every time we've retested it, it's acted as resistance since.
Those all time highs.
So what I told them was if we break and stay above it, what is that telling us. It's telling us a clear character shift in XRP going from this consolidation phase to potentially the next leg of an uptrend.
And so what have we seen.
We got that breakout at basically two dollars and fifty cents, and we've already gotten to three very quickly, just in less than a week, right, So clearly that change of character has come back into the market now and is
showing us really good things for XRP. So, you know, I think one of the amazing things about this particular indicator and the strategy that we're using here is so long as we stay above this anchored volume weighted average price, which right now is trading at two dollars and fifty six cents, is if we stay above there you have to be bullish on XRP. If we fall below there, you can think about trimming or reducing some exposure, or getting stopped out, shifting into more of a defensive stance,
slowing down your DCA schedule, whatever the case is. Right, it's going to depend on your individual case.
But if we stay above.
That anchor volume weighted average price, which we are, then you have to be bullish, right And so I think that's again it's a way to have a bias, to recognize what the trend is, and to exercise that trend into your bias, and then be willing to change your mind if and when the trend itself does change. But right now it's telling us, hey, look we're in this really strong enuprend. You've got to stay long.
I think what's the saying to trend is your friend until it changes.
Yeah, or like until the end or something like that. Right, So that's basically it.
As far as price targets, let's say you do a Fibonacci model on it. What are you seeing as far as maybe a next local top.
That's a really good question that I was not prepared for, Tony. So this is why I love coming onto your podcast, because you'll ask me really challenging, good questions.
So what I would do on this?
Maybe I can actually even share my my trading view screen on this.
Sure, yeah, I can. Perfect.
So let's do this live, because there's also another XRP chart that I did want to go ahead and cover, but we'll do this live. We'll do a Fibonacci from the high to the low of this consolidation, looking at the one twenty three point six and the one sixty one percent. We're doing this in linear scale, that basically gets us to three dollars and eighty cents and four
dollars and fifty cents. I would argue though, that based on this massive acceleration, it does make some sense to also put these in logarithmic scale, and that modifies our price targets to four dollars and five cents and five dollars and thirty eight cents. So you know, first and foremost we're going to need to achieve a breakout out
above that range. I'd also be curious to see where that sixty one point eight percent level is, because we might actually have some pretty interesting confluence here, at least in linear scale.
Oh no, it's not so I don't know.
It's Look, I think if you want to if you don't want to manage risk around that anchored volume weighted average price, and you want to do it from a tighter level, do it around the sixty one pointy percent, because now that raises your stop loss from two dollars and fifty six cents to two dollars and seventy two cents. But look, these would be the upside price targets here based on that analysis.
Very nice.
I would be very happy with five bucks around that zone.
Sure, i'd be happy for you guys. Look, I own zero XRP, right, so drinks on you guys.
And you know I've I've been transferring to my audience, like I'm going to liquidate all my all coins, but there's some bigcoin I'm never selling, man, Like there's some bigcoin I'm selling, but some I've said, like I'm leaving for my daughter. It's on a hardware wall. That shit is locked up. So I'm using all coins to just get more liquidity, man, and buy more of than a coin for the long term.
Yeah, absolutely, I mean, look, I have my entire wroth Ira invested in BTCL and it's the you know, I'm not sponsored by them, I have no affiliation with them. I just like their product, and it's the two x leverage spot Bitcoin ETF and I've been hovering my finger over over the cell button on that to maybe reduce anywhere from ten to twenty percent of my exposure because
this has been a massive rally. And you know, I think my I think my wroth ira is up like almost three hundred percent year over year, so you know, the returns are coming in and it's our job now. As you know, look in a bull market, everyone feels smart, everyone sounds smart. Right, It's easy to make money in a bowl market.
That's not the challenge. The hard part is keeping the money right. So it's it's a lot of fun. We're having a great time.
It's really awesome to look at these upside price targets and imagine what our lives could look like if and when we get there. But I also think it's important to take some profits off the table. I mean, even just from a short term trading perspective, Like I was in Toshi over the last like twenty four to thirty six hours, and I was up like sixteen percent versus where I entered it yesterday, and so it's like, you know, I'm gonna take those profits, and hey it was sixteen percent,
then great. You know I paid for my airbnb for the next month or two. I'm gonna pay myself, right, That's part of the game here. So I hear you on that one hundred percent.
I think you had mentioned this before in previous interviews you've done. Are you a leverage trader? Are you a spot trader? Are you macro trader? How do you play this market?
I mean, if I'm doing any trades, it's always going to be based on price action, technical analysis. I'll be looking at those statistical indicators. I'll be looking at price structure itself. One hundred nineteen four hundred on your board there on the back by the way.
Awesome.
But look, you know, I think I never touch leverage. I don't trade options from a real trading standpoint. I'm exercising a cycle thesis here, which is why I own BTCL and the roth IRA. I'll tell you, though, I was feeling like an idiot during the decline from basically January through April, though, right, you know, I was sitting on huge props and I didn't take any of it. And just look how that fun performed during that consolidation, right,
because look it's a two x leverage fund. During a consolidation, you're obviously not going to do very well when bitcoin falls thirty one thirty two percent. So but look I held on, uh, and you know, I'm obviously very happy with that decision. But it's because I have a lot of conviction in bitcoin specifically, and kudos to everyone else who has a lot of conviction in other all coins.
I'm not one of those people. But look, I'm rooting for everybody to do well, you know, and if you guys outperform me, I'm not going to be bitter about that. And uh, like I said, it's just drinks on you guys.
Yeah, And to your point, like sometimes even it's like I tell people, like, if this is still all new to you, don't try to you know, how should I put it? Don't try to chase the shiny every shiny object you see. Right, if you're making money, that is a win. Like even if your coin doesn't gets outperformed, but you still made an incredible return. Hey man, you're winning a life, right, It's better than losing and and not having that money, so you got to be thankful as well.
Yeah, I completely agree, Tony. I brought another XRP chart. Do you mind if I shared with you guys?
Absolutely?
Okay, let's do it here.
You guys probably saw it when we were looking at the actual trading view chart. But I have another piece of analysis looking at the relationship between the twenty one, the thirty four, and the fifty five day EMA. So if you guys are looking at XRP and thinking, I want to get more exposure, how can I do that using technical analysis? How can I do that using statistical indicators?
I think these three emas are providing a really interesting opportunity because, as we can see, we're seeing a massive acceleration in those emas. We're seeing the price of XRP trading above all three of them. The twenty one is above the fifty five, the fifty excuse me, the twenty one is above the thirty four. The thirty four is above the fifty five. So this is a really good sign. The thing that I want to highlight here is look at the massive acceleration that occurred during that Q four thrust.
Right.
We basically went from forty cents all the way up to basically three dollars. Let's just pick with some round numbers. We came back and consolidated into the twenty one and the thirty four day EMA. That was dynamic support which produced new highs here. So basically, I'm telling you guys, you had an opportunity to get long basically around two dollars and ride this back up to three dollars and forty cents. Not a bad trade from a statistical perspective.
Without rushing to get the exposure. You were actually using a proven methodology. And so as we're seeing these emas slope and trends significantly higher here, it's telling us, look, we might not have that opportunity right now. It might not come next week, maybe it comes, you know, sometime in earlier mid August. But if and when we do retest the twenty one, the thirty four and the fifty five day EMA, we now have three levels where we can dca and get some exposure with very easy invalidation.
If we fall below those emas, you can trim that new exposure the same way that you would have gotten out right here and avoided this decline from basically two dollars and sixty cents all the way down to.
A dollar earned sixty cents, right.
So you know, obviously if you sat through that to today, you're still very happy with yourself. But maybe you weren't sleeping very well at night during this drawdown, right, I don't know. So this is where using these statistical indicators, these dynamic levels, is going to keep us on the right side. So what I would say is if and when we come back and retest those levels, I think it makes a lot of sense to get some exposure.
Again, rookie, question, which one of those moving averages you either think is the most important or you know, how would you list them? As far as order, it doesn't matter. They're all kind of significant.
It's going to depend on the timeframe that you're taking the trade, right, So you know, I think usually the shortest ema that I'll use is about thirteen days. And you might even be looking like Caleb, why are you using the twenty one to thirty four and the fifty five? I like to use Fibonacci numbers, so those are all, you know, within the sequence of the Fibonacci Fibonacci number range, right, So sometimes I'll use the thirteen and the twenty one
and the thirty four. Sometimes I'll really just use the twenty one, the fifty five and the two hundre. Obviously, two hundred is not a Fibonacci number, but it's probably one of the most important moving averages that I use.
But it really just depends on your range, right, But I think that's the beautiful thing here, right, is we're looking at those three levels twenty one, thirty four, and fifty five and saying, look, we can take marginal exposure every time we retest those levels to exercise a thesis or an outlook based on a short, medium, or longer term timeframe, right, And in this case, we're looking at really short short and not as short time frames because we're using the twenty one to the thirty four and
the fifty five. These are obviously very still very short term levels. But it's it's all gonna come down to your time frame.
Let's talk Solana and what you're seeing on that.
¶ Solana Bonk Analysis
Front, dude.
I actually did not bring a Solana chart with me, but here's what I will say. Let's go ahead and look at bank because I think bank is basically uh sole beta if you will, right, and it's obviously kind of led on this massive breakout move here.
We're using a very similar kind.
Of strategy as that XRP chart with the anchored volume weighted average price from those Q four highs of last year. We've achieved that breakout very similar to what XRP has been doing. We should probably expect good things to happen to Bonks so long as it stays above this range. I mean, we're already about twenty five percent above the anchored volume weighted average price since we broke above it.
This would not be happening if Solana was struggling, right because obviously this is probably one of the leading aut coins on the Solona ecosystem. I think it's the second largest after Trump and then fark coin is up there. So you know, I mean, these are these are the three Solana ecosystem tokens, and you can basically exercise your thesis on Solana right here.
In my opinion, Oh for sure, I'm not a big fan of meme coins, but you know, it is what it is. It's in the market, and unfortunately, you know, we just got to I don't know, deal with it.
Look, you know, I'm also not a fan of them. It's basically a massive game of how potato. And so for me, as someone who just trades based on technicals, I really have to put my pride, my ego aside and just look at this and say, hey, is there money to make here? And is the way to do Is there a way to do it while controlling and managing risk? And I think for all of the talk around utility and the tech objectively, we have really not seen those tokens perform very well.
The cycle.
What's happening to Avalanche, what's happening to Cardono, what's happening to light coin?
The list goes on and on and on and on. But when we look at a lot.
Of these Central Exchange listed meme coins, they're outperforming all of the tech, utility and DeFi tokens, you know, ninety five ninety eight percent of them.
And that's signal there, right.
So if we want to be in the fastest horse in the race from a trading perspective, and we can find attractive risk adjusted opportunities for us, then you have to take those swings. And so for me personally, I've actually been trading a lot of meme coins.
I think probably this.
Year alone, I've almost exclusively focused on trading meme when I am trading, and so obviously during during Q one, I gave back a lot of significant profits because I made a bunch in Q four and I've been riding the way back up again here over the last month or so and it's been a great time.
Yeah.
Absolutely, And I think there's a distinguished well we have to give the nuance there. You can trade it. I think if you know what you're doing, like you right, you obviously know what you're doing. But there's some people who come in and they buy this random meme coin that was started last week, right unpumped dot fun And
that's the part I don't like. But there's established meme coins like those like Pepe, Lake Bank and so forth, have a community, have been around for a while, weren't started last week or last month, and you know, those are the riskier ones that go out further into risk curve exactly.
I mean, you hit the nail on the head here. It's all about risk adjusted opportunities. And so when we're looking at these things that are you know, very likely rug pull opportunities that are being listed yesterday or two days ago, whatever the case is.
Yes, you can make a lot of.
Money on them, but I would definitely urge a lot of investors to stay away from those one hundred percent. And that's why even just for me, right, I'm I'm trading only the ones that are listed on coinbase, and you know they're going to be really high beata to the rest of the market. So when the market is doing well, they'll do really well. When the market is
doing poorly, they'll do really poorly. And I'm totally okay with taking that risk because I'm going to control and manage that risk and get stopped out.
At a certain point.
So you know, we're all going to have a different level and that's what it comes down to. But look, I mean, this market is just crushing it right now, Tony. I actually brought another exclusive study that I haven't shared
¶ Total Crypto Market cap
anywhere else.
I have to boce with you guys. Are you ready for this?
Yeah, let's see it, man.
Okay, So what we're looking at here is others.
This is total crypto market cap excluding the top ten coins.
Okay.
What I've done here is I've added on the one hundred and fifty day Williams percent are oscillator one hundred and fifty days. I'll typically use one twenty because it gets us to a third of the year. So you might be looking at one fifty and say it's a little bit arbitrary, but I still think it gives us a really effective signal here. If we're just going to focus from a statistical kind of blindness, right, if we're only focusing on statistics, what is this signal telling us?
How effective has it been in the past. So what I'm highlighting here is a signal that literally just flashed this weekend on Sunday, and we're obviously continuing to get really strong followed through since then. But what we're looking at is each time the one hundred and fifty excuse me, each time the one hundred and fifty day Williams percent our oscillator has gone from over sold, which is below the lower bound here, to overbought, which is above the
upper bound here. So we're getting this full oscillation from oversold to overbought. Essentially, what we're looking at here are really strong statistical momentum thrusts. When we're seeing a momentum thrust, what is that it's telling us that there is an overwhelming amount of demand coming into the market. Let's think about what that means, guys, Is it bearish if there's an overwhelming amount of demand?
Probably not.
That means a lot of investors are putting their money where their mouth is and speculating to the upside for writer, for wrong, but they are doing it. Investors are putting their money where their mouth is. And so what has actually taken place in others after this signal is flashed each time? If we look at the signal that occurred in the second half of twenty and twenty three, it was a little bit slow for about a few months, and then we really have this massive uptrend that took place.
If we look at the second signal that occurred in November of twenty twenty four, just after the election, we saw really fast and significant upside in a very short.
Term amount of time.
So I don't know if this current signal is going to be much more like Q four of last year or the second half of twenty twenty three. All I do know is that what this signal is telling us objectively from a statistical perspective, is that our bias should continue.
To be to the upside.
So I want to really kind of package everything that we've talked about on this podcast together. Right, We're seeing Bitcoin already achieving some price targets breaking out to new highs. We're seeing total minus staable coins on the verge of making new cycle highs. We're seeing really strong market dynamics occurring for XRP and ethereum. We're seeing BTC dominance plus E dominance plus XRP dominance show a lot of strength. We're seeing others try to make that momentum thru US.
We're seeing a lot of really great things coming into the market. We're seeing stable coin dominance declining. As we're looking at the preponderance of the evidence, it is telling us unequivocally, there's no question about this, guys, that our bias should be to the upside. And now the rest of the work is about managing downside. What is our risk that we're willing to take and where are we going to get stomped out? That's what the game becomes
about now. But we know, without a question of it, out beyond a shadow of it doubt, that our bias needs to be to the upside. We are in an up trend. If you're not long during an up trend. You are doing investing completely wrong if you are not long during an up trend. That is what we live for as traders and investors. We don't have a lot of access to these exotic instruments and securities and all this other stuff. We want to be on the left curve of this and say, look, we are in an
up trend. We have to participate, and that means we need to be long and then focus on managing.
Risk absolutely well. Put and I love that chart, by the way, the others excluding the top ten that I know a lot of people are going to be interested in that because they hold all coins that are you know, eleven to one hundred in that zone or eleven to fifty exactly. So that's definitely great to see. There's a lot of bullish signals here and the setup for the rally to continue.
Yeah, and look, you know, the economy continues to be resilient in dynamic. It's certainly not perfect. We had industrial production numbers that came in way stronger than expectations. Today PPI came in significantly lower than expectations.
CPI is a little bit of.
A mixed bag, but I would generally say that disinflation is still intact and the FED isn't looking the cut rates immediately, but rate cuts are probably coming in the second half of this year, at least three months down the line. And so from that standpoint, if we still see really strong corporate earnings in the United States, which is going to give us a bid in risk assets in the stock market, I mean, it's still very clear, right a lot of crypto is just a high beta
stock in a lot of ways. For right, if we're wrong, we could disagree with it. But if you look at the correlation between bitcoin and semiconductor stocks, I think it's eighty six percent over a trailing three month period. So clearly, if good things are happening fundamentally for corporate earnings and semiconductor stocks and semi conductor stocks keep going up, then probably bitcoin is going to keep doing really well also.
So we have all these things continuing to fall into place, rate cuts are eventually going to be coming back into the picture here. And look a lot of people were saying that, you know, in twenty twenty four, they're saying, oh, these rate cuts are going to be bearish. Look at how the SMP five one hundred and the Nasdaq one hundred have performed since those rate cuts happened in September. Look at how Bitcoin has performed since those rate cuts happened
starting last September. Obviously, they have not been bearish, but you know, when other people are making stupid decisions, it allows us to make money a lot easier. So let's keep rooting for those people to say that ray cuts are bearish.
Caleb always great Alpha, great insights, my friend and everyone. Check out Caleb's ex profile, follow him, sign up for his newsletter all great information.
Man.
Thank you so much.
Thank you, Tony. We'll do it again soon