The Wolf Of All Streets - Bitcoin Is Up 100% This Year, Will It Shoot Higher?

Episode Date: October 26, 2023

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Bitcoin is now up 100% on the year, making it the best performing asset on the planet. But is that true? No, because GBTC is up actually twice that much, up over 200% this year because of the price action of Bitcoin and the closing of the discount. But either way, as stocks seem to waver here, as the economy starts to wobble. Bitcoin still performing as an uncorrelated asset and booming to the upside. I guess what everyone now wants to know is will it shoot higher? Of course, I've got Dan from Chart Guys at the end. We're going to look at the charts and discuss that. But I've also got one of my favorite guests, Joshua Frank from The Tie, always here with

the data and the hot takes. And he just sent me a thread that absolutely exploded my very small lizard brain, claiming that there is evidence that Mark David Lamb, the co-founder of CoinFlex, alongside Zuzu, Zuzu, Zuzu, Zuzu Studio, and Kyle Davies of 3AC were using CoinFlex creditor money as a personal piggy bank when they started OpenX. Wow. We're going to dig into that right now and everything else. This is going to be epic. Let's go. those days where we make a plan and we've got a title and there's a thumbnail and it's got faces on it. And then something happens that nobody's talking about yet. I was lucky enough to have Josh who always gets me the hottest new information on the streets in real time hits. And I don't even

have time to process it. So we just do it in real time. I'm just going to go ahead and bring Josh on right now. We're going to talk about this. Josh, here's the thread that you sent me. I'm just going to read the first part. We've uncovered evidence to show how CoinFlex.com founder Mark David Lamb with Zuzu and Kyle Davies of 3AC use creditor assets as their own, as their personal piggy bank. We owe it to the industry to take out the trash. Fight starts today. Here's the full story. Now, to be clear, Mark used to be CoinFlex. So I don't even know who's technically tweeting from the CoinFlex account right now. This is not CoinFlex account. This is an account that was created either today or yesterday or something like that.

Oh, God. Okay, guys, we're going to go out and say this is speculation and we're going to dig into what we know. Okay, yes, go ahead. Yeah, I mean, I think this is all speculation, obviously. There are definitely, I mean, there are emails here that are timestamped. There are bills with people's name on it. You know, it is a small account,

but I will note that it's being, it's only followed by a few people, and those are large CT accounts. So I have a feeling that somebody knows something if this is true. But basically saying that CoinFlex lost $160 million of customer deposits, primarily because Roger Ver didn't pay back a loan that he owed to CoinFlex. And I don't know what happened to that. $70 million or $40 million of it. I don't want to quote the number wrong. Something like that was a single loan just to him. And that buried the entire exchange. Yeah. I mean, I thought it was over 100 just to him. Maybe it was by the end. Yeah, you're right. Either way, it was a huge, basically unsecured loan to one guy. Who just decided, yeah, I'm not going to pay back. And

by the way, no one has given him shit about that. I mean, that just kind of fought off. I mean, what's $100 million lost in crypto, right? I mean, we're talking billions. Happened while we were talking. All right. Yeah, exactly. Exactly. Yeah. And so apparently, you know, they proposed a restructuring proposal of CoinFlex, which

was going to give basically the creditors, you know, some board seats on the exchange, ownership of the exchange. That got like 98% approval among creditors. I think it passed in Seychelles. And then apparently, somehow, Mark, who is the founder of CoinFlex, according to this thread, this is not according to us, this is according to this thread that's been shared. And you guys can find it. It's at CoinFlexReal. That's where the thread is coming from. You can see it here. Apparently, Mark basically partnered with Suzu and Kyle on OpenX and basically merged the two companies together without approval from creditors, without approval

from the court in Seychelles, and has been using the remaining creditor money to pay for things at OpenX. There's pictures there of them doing a $30,000 photo shoot, $31,500 photo shoot. That's an expensive photo shoot. Dude, but look at this. But, but, but, I mean, they look great. They do look great. I really like the construction in the background.

I mean, they didn't even use lighting. I'm just being honest. This is literally a picture from an Android. But go ahead. Yeah, I mean, there's... Yeah, like this is crazy. This is crazy. So this is an email thread where it says...

Here, check this out. If you can share your screen too. Yeah. And then we can add this easier. Hi, whatever and whatever. This is from Mark. Sue, Kyle and Leslie and I have received some fines each for 200,000 AED. I don't, I don't, is that Dubai's currency? Yeah, that's a United Arab Emirates currency. Can we please expense these and have them paid to us in USDT? You can use the address below for Leslie and my reimbursement.

I will then settle. Leslie's his wife. By the way, for anyone who's wondering, Leslie is Mark's wife. I mean, this is pretty damning. I mean, this is not even that old. This is from June 19th. I mean, either that or somebody has spent a lot of time faking all of this. Yes. And the claim here then is that, so VARA was the regulator in Dubai, I believe. I can't remember if it was Singapore or Dubai, so I don't want to get it wrong with seemingly Dubai, if this is here. Yeah, Dubai. And they went on sort of a wild fining spree and making all these accusations. This is the regulator against these guys and they're paying the fines with coin flex creditor money. I mean,

that, that, that's, that's what this is. And we know that Sue actually got picked up in Singapore is currently, I don't know if he's currently sitting in jail or got out on bail, but had like a couple months sentence in jail in, in Singapore.

So like, this is already on the radar of Dubai. But I mean, there's some just damning stuff here. Look at this one. Influences were paid with creditor assets to continue pumping AUX. By the way, OX was like FlexTurk token you didn't exchange for OX. And then the founders took proceeds from the sale of credit assets to pump up the same tokens that they had just sold OTC. And I told you guys, I was in Dubai in February and Kyle and Sue were on a roadshow selling OTC Flex tokens. Because I was there for the Satoshi roundtable. It's a bunch of big, heavy hitters in crypto.

And everyone was taking their personal meetings, I didn't buy any flex token because fuck those guys. Even if I thought I was going to go up 100x, I just don't roll like that. But this is insane. This is insane, I read just read the thread. I mean, I, you know, look, it's coming from an account that was created a couple of days ago with 100 and something followers, but it's pretty damning. And look, it's Sue and Kyle. It's not like they're going after, you know, somebody who has not been proven to be a bad actor in the past. They're going after, you know, people who covered up their balance sheet and lost billions of dollars of other people's money. So yeah, I mean, I, you know, yeah, it's... I even get a little egg on my face here, apparently, because as you pointed out, there's a tweet here. In my defense, I don't feel like I had anything to do with this. But this is an audio recording, which I'll just let you guys look at the blips instead of playing it because it hurts my heart. But this was on a July 3rd Twitter spaces, also known as Crypto Town Hall, which is the Twitter spaces that I host alongside Mario and Ran, where we had Kyle on there to discuss all of this. Apparently I was

on that show too. Honestly though, this is just where he stated, Kyle, openly that CoinFlex had now become OpenX. And everyone at CoinFlex is like, how do Kyle and Suzu now own all the creditor assets as two-thirds partners in a new exchange where everything was sent over? This is just crazy, man. But it is. I think you made the best points. The most crypto thing ever. Yeah. I mean, look, I wouldn wouldn't be surprised this was the case i mean you know um you know you let a fraud continue to abuse and steal people's money and take advantage of people and they'll do it right so um the other thing you know in this thread in may 2023 zero exit

governance token for openx was deployed this was in, just flex bridge on a one to 100 basis. They just, they've now converted the token like multiple times. Yeah. It's great. It's great. All, all, all your funds are belong to us, right? All your base are belong to us to use an old video gaming meme. We're going to dig into this more, I guess nobody should be surprised, but the interesting thing is, you know, you said,

when you let guys who were gratuitous frauds in the past, give them a window, they open the window, start a new business, which by the way, has failed. But the thing is that until this point, everyone had assumed fraud in the past, but there'd never been proof. Kyle's whole argument when he was sitting with everyone in Dubai was there's no suits against me, man. Like, he's like, there's no fraud accusations.

We blew up. We were a shitty hedge fund. We exploded. Sorry. Like we never, we were only facing institutions, which we all know, like if you're a voyage,

you would think if they got away with it, which they did, or they at least have so far, obviously they, you know, I think was it Sue who went to jail for a couple of months or was supposed to? I think he's currently in jail for a couple of months. I just don't know if he's still there or not. I don't want to misquote it, but it was within a couple of months ago that he was going for a couple of months.

He went to jail for apparently running away from, I think, or- From the bankruptcy. Yeah. Yeah. He was not answering any of the questions. And Kyle still has an open case then in Singapore. So if Kyle lands in Singapore, he's gonna go to jail. But the implication there is's Mark who's the one that's using creditor assets from OpenNet, from CoinFlex, not them. I mean, you know, Mark seems to be the one making the decisions here. At least the emails, you know, while they allude to Sue and Kyle, they are Mark making those decisions, if you read them. Yeah. And since I guess we're going full YOLO on this stream and just changing it up, let's talk about Hamas. But not the political side of Hamas. The article from the Wall Street Journal that said that Hamas had received, what was the number? $82 million of terror financing via crypto. This was an article, everybody knows that Elizabeth Warren and others have jumped all over, 105 senators and congressmen wrote a note

to national security and the White House, et cetera, because of this report from the Wall Street Journal saying we need to immediately stop the terrorist funding of terrorists doing terrorism by these crypto people doing crypto shit that want to fund terrorists because all crypto people are terrorists it didn't say that but that was sort of the implication and this was from data coming from elliptic and everyone pushed back chain analysis to for the quick broad strokes chain analysis dug in we're like whoa whoa whoa. You're basically using every transaction by this exchange to count it as the volume. It's the equivalent of, I don't know, Hezbollah having an account with JP Morgan with $500 in it and then saying every single transaction that JP Morgan did is fraudulent. I mean, that's the

equivalent. That's the equivalent. Basically, they're counting all the transactions for a particular exchange. And the crazy thing is, so yeah, so this comes out. Wall Street Journal publishes this bullshit story citing Elliptic. And look, maybe they thought they were citing Elliptic correctly.

But then- Oh, I think this is more likely not like some paid conspiracy. I think it's an idiot who didn't understand. No, no. But then Elliptic came out with a blog post yesterday setting the record straight. And the reporter at The Wall Street Journal refuses to correct it. And he is getting absolutely destroyed on Twitter right now.

It's fun to watch. Nick Carter had some tweet yesterday that I didn't even know the context. And he was like showing the guy, uh, sending like inspirational quotes. And he was like, this guy has devolved into, I mean, to turn my Twitter account into other people's inspirational quotes,

since I won't respond to any of this stuff, but yeah, the wall street journal has not retracted this elliptic says completely fake. And if you dig into it, it was $450,000, not 82 million, which at one point they said was 93 million.

Yeah. I mean, and what Elliptic has said is that since the war broke out on October 7th, Gaza has only received $21,000 or Hamas rather has only received $21,000 in donations to their address. And in, I believe it was April or March or something of this year, they came out and said, stop sending us crypto. One, it's traceable. And two, you're going to get caught if you're sending us crypto and you're going to get in trouble with your regulator or sent to jail. I mean, 21 grand is like a really good bar mitzvah cleanup for a kid at this point who's 13. I think it was a good bar mitzvah cleanup. I don at this point. And, you know, who's 13. I think it was a good bar mitzvah cleanup. I don't know, with inflation, maybe not anymore.

But I mean, $21,000. Don't send us this money. You're going to get us in trouble. You're going to get yourself in trouble. But now we have senators and congresspeople writing letters. So, I mean, I wonder if Elizabeth Warren will retract. Probably not.

We all know Elizabeth Warren isn Warren will retract. Probably not. We all know Elizabeth Warren isn't retracting. I know. She's looking for, she is the one, from everything I hear, she is the one behind the scenes pulling the strings with the Biden administration and Gensler on crypto, or is a huge part of it, or is working alongside Gensler. Yeah, the claim is that it was actually her mandate for allowing Gensler to be yeah, the claim is that it was actually her mandate for allowing Gensler to be

appointed the chair of the SEC was that effectively he would do as she said, and that was her deal with the White House was that she got to control sort of the SEC, but also crypto policy. And then her new like the new one of the new chiefs of staff is from her, like her, like, you know, inner circle now being replaced. So it's probably just going to get worse there unless uh this administration obviously has voted out it's crazy crazy crazy but okay do you have any more any more on terrorism hamas permits for presidents and fake news no well there's always crypto so we only have fake news you know no one's tweeting uh no tweets this week about uh the getting approved, though, from an intern.

But you heard it here first, guys. 17 ETFs were just approved tomorrow. Yeah, exactly. Anyways. Yeah. So let's let's move on to Bitcoin's recent outperformance fueled by institutional demand, JP Morgan says. Now, there's been a lot of sort of back and forth as to where this buying came from and why we've shot so quickly up to the 35,000 area. I do think when you look,

and this is what they're looking at, and I did a show on it yesterday, when you look at the CME, 100,000 Bitcoin open interest, it's the highest that it's ever been. So there clearly is some sort of institutional demand for this, although those are futures contracts. But you actually sent me, once again, a great thread not long ago that showed that a lot of this was in Asia and it was a gamma squeeze, a short squeeze, effectively, right? That people were covering shorts or having to buy the underlying and that's what sort of drove price up. Yeah. I mean, I don't want to take, I'll take credit for sending you the thread, but Alex Thorne, right? Yeah. Alex Thorne, who's the head of research at Galaxy was the one who wrote it before the move, basically saying that market makers in Asia, in order to make sure that they were market neutral, would have to basically go long spot Bitcoin because of a gamma squeeze. So he wrote the thread. I mean, you can pull it up if you want, or you can just, everyone can just check it out. His name's Alex Thorne. Speaking of the fact that,

you know, this was going to happen. And from the conversations that I've had with folks, it was, well, first of all, 50% of the original buying activity happened. This was before the move happened. Alex tweeted this. So give him credit. This was before the move happened. Alex tweeted this. So give him credit. This was before the move happened. More than 50% of the buying activity happened on OKEx. And from everything I heard, it was a bunch of market makers in Asia basically covering. Right. But that still sends us to 35,000 and now we get to ride the narrative. Right. But interestingly, I had James Butterfill on yesterday from CoinShares and he's an encyclopedia of data on institutional involvement. And he said that there has been an increase, but largely actually, it seems like the big money is still

on the sidelines, which makes sense because why would you buy any of these institutional products now if you think an ETF is coming? I think that's partly it. I was speaking to the head of consulting at a big four firm yesterday who does advisory work for clients, including helping corporate treasuries with deciding their strategies. An example of that, obviously, they don't work with micro strategy, but micro strategy is an example. They're a crazy example of somebody who over leverages their corporate treasury to buy Bitcoin. But other corporate treasuries are looking into Bitcoin. And what he mentioned was that a lot of them are actually just in a wait and see mode until the ETF gets approved because they don't want to have to deal with the risks of holding spot crypto. So that's the first time I've heard it from somebody. And this is a

person in a relatively senior position at a big four firm. Okay. So we're talking about this increase in institutional adoption of crypto, obviously, the Bitcoin spot ETF driving that narrative. But there's a flip side to this that you've shared with me, and I know we can't get into any specifics, but it seems that there's some, what's the opposite of adoption? I don't know. Retraction? There's some institutional retraction the opposite of adoption? I don't know. Retraction?

There's some institutional retraction happening at the hedge fund level. This has been going on for a long time, right? You know, post FTX collapse, you know, institutional sentiment towards crypto has collapsed effectively. And a lot of the large traditional hedge funds were trading what's called GP or partner capital. In other words, the folks that run the firm's capital, as opposed to LP capital, which is limited partners or outside capital that they're managing. And the idea was, if you think about a $50 billion hedge fund, the way that hedge funds generally work is they take a two and 20 model, 2% management fee, 20% performance fee. So on $50

billion, they're making a billion dollars a year just in managing that money, plus 20% of the performance. So if the $50 billion goes to 60, they're making another $2 billion on that performance, right? So $3 billion effectively. And so what they were doing was they were trading that money, the money that they were making, the profit that they had, or their personal capital. But their idea was that eventually they would go out and they would raise LP or dedicated capital to crypto. Unfortunately, a lot of the big firms that were trading crypto with the idea that they would start trading outside capital even shut down internal capital.

So even got concerned about their own money and managing the risk of their own money. The reason they were doing that first is they wanted to just put systems in place. They wanted to get comfortable with crypto from a counterparty risk perspective, who they're doing business with, where they're costing their money, who they're trading with. And what we've increasingly seen is a lot of the folks that were trading spot crypto, including some of the people that were most publicly pro-crypto in 2020, 2021, hedge fund managers are no longer trading crypto at all. And what they're doing is they're just trading CME Bitcoin. But with that said, there are a couple of funds that did get to the point that they were trading LP Capital. And one of those funds stopped trading last week. I'm sure

that news is going to come out at some point. I'm not going to say who that fund is. Name names. I'm just kidding. Yeah, I'm not naming names. It will come out. It will come out. But the reason that they stopped, if you think about it, let's just say a fund, for example, is $20 billion, as an example, right? And their crypto strategy is $50 million. The opportunity cost of not having that same team focused on their other strategies is humongous. There's reputational risk associated with trading crypto. And let's say you turned 50 million into $100 million. You're earning 20% on that. What are you going to make? 10 million bucks? It's a fraction of the management fees that these firms are earning. And the reason that they can't

grow those strategies bigger is because of the lack of liquidity in this market. Because post FTX collapse, we've seen it. I mean, go look at volumes. Volumes have dried up in the space. And so for an institution, if you're managing $50 billion, it's not worth it unless you can put $500 million, a billion dollars to work, which is, by the way, a billion dollars is 2% of your assets, right? If you can't even put 2% of your assets to work, what's the point? And so, you know, unfortunately from the hedge fund world, among large traditional hedge funds, you know, things are really starting to dry up. And that doesn't mean that they're not interested in crypto. It doesn't mean that they don't like crypto. It just means that there's, you know, there's no liquidity. There's no volume. And it's also a counterparty risk problem.

They're like, who do I want to do business with? Who do I feel comfortable? You think about it, right? If you're managing a sovereign wealth fund or a pensions assets, right? And then you put those assets on an exchange and that exchange gets hacked, right? And let's say you even lose 1% of their assets. They're going to reevaluate the other 99% of the money that they have in your fund to trade fixed income or equities or credit or anything else that's not related. And so it's not great.

It's not great. Yeah. But one final story about institutions, and this one really actually was a wow factor to me. JP Morgan says JPM coin now handles $1 billion in transactions daily. JPM coin allows blockchain-based payments by wholesale clients. Token is a rare instance of live blockchain use by a big bank. To be clear, guys, this is not like on Ethereum or Solana. This isn't built on near, right? This is a private blockchain built by JP Morgan, but this is massive adoption of the actual technology. This was a number I did not expect at all. A day, a billion in transactions. What do you make of this?

They're not lying. It was JP Morgan. No, I mean, look, there's a... Is JP Morgan's... Is it a fork? Is it like their own private instance of Ethereum? I forgot what it actually runs on. Well, first, I know that the original iteration

of JP Morgan coin, they left and became Cadena. I don't know if you remember that, but like Stuart Popejoy, whatever his name is, he left JP Morgan, took basically the original JP Morgan coin and formed Cadena. Yeah, so it's an enterprise-focused version of Ethereum. So it is a fork of Ethereum,

but that doesn't mean that any value is going to accrue Ethereum. Look, I think we're at the point in the market that I really feel like this is 2019 all over again, 2018, 2019 all over again, where back then it was security tokens, not crypto, or blockchain, not crypto. And now we're saying tokenization, not crypto, which is the same thing with a different word. And so look, it's not just JP Morgan. I spoke to one of the five largest asset managers a couple of weeks ago. They're also running their own private version of Ethereum and they're running a Polygon supernet and test net. I've talked to other large asset managers that are running Avalanche subnets. Some of these things have been announced, but that doesn't necessarily mean any value is

going to accrue to the tokens. The reason that they like blockchain is because they think it's going to help them save time with settlement and save money. And I think at the end of the day, a lot of the users of these applications don't even know that they've abstracted it away where they don't even know they're using blockchain. I think the question becomes, does some of this happen on public networks? Does that use block space and make price go up? Or does it increase demand for coins? For example, to run an Avalanche SuperNet, you need to stake a certain number of Vox tokens. And so it's not a huge number, but if there are thousands of these SuperNets, that becomes interesting. Or do you have an instance in which these different networks that are all separate need to communicate with one another and you have bridging protocols or other layer ones in the middle that are actually facilitating the transactions that are occurring across these various blockchains. I know, for example, a digital asset.

They're a company that has a programming language called DAML. It's very public, but Goldman is building on them. Broadridge is building on them, and a bunch of others are building on them. They've spoken about launching a public network, which is going to enable communication across the various private blockchains that are operating. And that's a public network that presumably could or would have a token. So it is, you know, but as of now, I don't believe this accrues value to crypto other than it's getting people talking about crypto.

It's getting these tokens in front of them and it's starting conversations. And if the regulatory environment changes, if liquidity changes, right, potentially that's going to drive demand. I mean, I don't think it's a bad thing. I just don't think it's a massive thing. No, it's proof of concept. I mean, it's proof of concept for the technology. It's all proof of, they're all technical. I mean, it works and for JP Morgan, clearly it's cheaper and faster, which is the promise of crypto in the first place, whether it's accruing or not. So as you said, I don't see it as a possible negative. I mean, once people see that it works, they're going to, I think, find a way. But yeah, it's just funny.

It's funny in context of JP Morgan and Jamie Dimon's comments about the space in general, and you're seeing them actually utilize this and this much adoption of it on their end. And the bigger point there is the one that you made, which is that nobody knows that it's blockchain when they're doing it. Nobody's calling JP Morgan and being like, how did we settle this, right? What technology did you use?

But they're just happy that the settlement is faster and cheaper. That's what we need for any meaningful mainstream adoption anywhere in crypto. Yes. Like if we're still talking about whether it was settled on Solana and Ethereum and stuff, then we're still just talking to crypto nerds in the echo chamber. And we're not talking to your average person who would never ask that question. Correct.

Anything left? I mean, we talked about Elizabeth Warren, Kyle, Suzu, its greatest hits. Do we need to just have a quick mention of Doquan or should we talk about SBF? He's testifying today, right? I was where I was about to go there. SBF is testifying today. So if you're in New York City and you want to go stop by the courthouse and, you know, tell them what you really think, go for it.

I want the real alpha then, since you get me all the inside information. Did he get his Adderall or not? I don't know if he got his well he said he couldn't testify or think or do uh basically anything functional without uh that 12-hour release 30 milligram guys you need to get a psychiatrist on here to refute that that's even like a thing that doesn't even make any sense dude imagine sitting there and being like you you know, I could fight for my life, but also not without my pills. Yeah. I need,

I need, please drug me first. Yeah. I mean, that role is cool at all, but, uh, you know,

you think you could get your shit together to maybe, uh, keep yourself out of jail for the rest of your life, which is where he's going, by the way, Josh, man, thank you guys.

Obviously check out the tie, check out Josh, uh, link down in Twitter. Once upon a time, a few years ago, Josh and I both had Cointelegraph create really cool busts of us because we were in the top 100 most influential or something people in crypto. I haven't seen myself on that list anymore.

It's weird. Yeah, I don't know. I think I'm one of the top 100 least influential people at this point. Thanks for having me on, Scott. Always a pleasure on scott thanks man i'll talk to you soon man that was uh you know you make a plan and then all of a sudden it's kyle davies is apparently a member of hamas or something that people are going to cut together and be like i was watching a live stream and they told me that kyle davies and suzu are funding terrorists with OpenX funds and partnership with Elizabeth Warren. We know how that goes. But now we do have this title, Bitcoin's up 100% this year. We talked about that. I told you that GBTC is up twice as much. But what is on everyone's minds, obviously, is what are the charts telling us as to where it's

likely to head next? This is a pretty big move. I've got everyone's favorite, Dan, from the chart guys here to discuss. You're surprised that Bitcoin's hanging out here around 34,000 today? I was surprised at the follow through over 31.8. Everybody knows 31.8 is the top, the key level. And we were already fairly extended on some of the shorter term or midterm RSI levels and a bit overheated. I would have anticipated you break it, you spike over 32, and then you kind of chill out a little bit. But to go 10% over, that was surprising in terms of the amount to follow through. And it certainly surprised the bears and it surprised the bulls with cash on the sidelines. And to be hanging out near the range high is a good thing. Sideways consolidation, establishing new support levels, and new price acceptance is always a good thing if you're a bull.

Yeah, I mean, gun to my head, I would have thought that 31.8 was going to be the high for the year. Well, I guess there's only two months left. Well, just if I was sitting here in October and we were at like 28, it would be pretty awesome if we went up 10% more this year. Right. And we're testing those highs and there we go. Yeah. Yeah. And a lot of people, you know, took some profit right at that resistance level. And now we're like, well, wait a second. I want that Bitcoin back.

Yeah, exactly. And we've seen a real struggle actually at 35. Obviously, we tested it sort of that first time. We tested that sort of first time and made a potential, I'll call it. We never called it a double top, but this is just on a four-hour chart. But the first initial push pushed exactly up to 35, 157. And then yesterday, we saw sort of this battle there again at that area. And it topped exactly there. By the way, for anyone listening, this would not be a double top unless it breaks below 33, because to me, that's the swing low between the two highs. So when people start calling things double tops and not saying potential double top, they're technically wrong there. So I just like to point that out. But now you can see that you have pretty, I think, clearly defined levels right now. Actually, if you're short-term trading it, I would say you either want to buy here or above here, right? We get above it and do it there. I don't know if that aligns with what you're thinking. Maybe you can pull up your screen. Yeah. And as you mentioned, I was using that level yesterday. When we were getting to $35,000, I was shorting MARA, the crypto stock, just in terms of expecting we wouldn't see a whole lot

of follow-through. But as you mentioned, if we break above it, just in terms of expecting we wouldn't see a whole lot of follow through. But as you mentioned, if we break above it, just got to be short term. We're not looking for any swing trade entries up over 35,000, in my opinion. Need to see a clear pullback. We've gone up almost, I guess, more than 20% without daily consolidation. So in terms of risk reward of swing entries, there's a lot of cash on the sidelines right now patiently waiting for that daily consolidation. And one of the big clues for us that things were shifting, and last weekend, I was able to say, the crypto market right now over the past week is different than it's been in the past three months, because we were seeing these characteristics of a bull market. And one of them is when Bitcoin trades sideways, which it did last weekend, altcoins get their turn. And so Bitcoin was sideways on

the weekend. The dominance chart saw daily consolidation and we got LINK and SOL making a big move up. And again, that's always a positive for the market when you're seeing those profits rotate around and you're seeing traders and we're going to this coin and focusing on this one and then take some profit and we're going to this coin and focusing on this one and then take some profit and we're going to this one that hasn't run yet. And you get that kind of musical chairs action. And so we're watching for the same thing. Right now, Bitcoin is sideways right around 35,000. And we can see that there's some altcoins making some moves today. And again, that's always a good sign. If Bitcoin is sideways, dominance dropping and altcoins playing

some catch up is a beneficial sign. And from here, the next clue for me will be the response to hourly oversold conditions. Because we're seeing first 15 minute oversold conditions lead to a bounce and then first 30 minutes lead to a bounce. And that's just showing me number one, bears aren't getting a lot of follow through. And number two, cash on the sideline is still buying those dips. So the next timeframe is first hourly oversold conditions. When we see that, if that marks a daily higher low, that will show that we are still very strong at this point. Yeah, that's great alpha. And you can see there even just on the volume that it was increased all the way up on buying. And then if you go to lower timeframes, the volume has now decreased on this selling. So it does look more like consolidation than any

defined downtrend where you would see increased volume on any level of selling. And I love your point about RSI. I was talking about it on higher timeframes yesterday. Obviously, the daily here topped about 87. I mean, we go higher than that in the peak, peak, peak of some of these bull runs, but we don't get higher than that very often, right? That's maybe less than 10 times since 2017. And those are at the peak, peak, peaks, right? And so I'm not saying that that's necessarily problematic. I just think exactly what you do, which is that we need daily consolidation. And another push higher is going to give you a bear div probably all the way up here to overbought. So you'll get a higher price, but then you'll get kind of a lower high probably on RSI. And that might be the signal that we're getting it. But I do still love that weekly RSI

is just, just touching overbought here. And that's what happened at 12,000 before going up to 65. So in my opinion, on these higher timeframes, overbought is actually the power zone. This is when the party's actually starting, right? But on lower timeframes, not the case at all. Yeah. A lot of people misuse RSI. And it's the kind of thing where I can use RSI right now in the daily timeframe and say, I'm not comfortable making a swing entry long, but I'm not saying I'm shorting, you know, and we have a clear 35,000 level. Some aggressive bears could try and, you know, top fish that level and have low risk. That's fine. But I don't look at the RSI and say, well, you know, I need to start aggressively

shorting because again, we can look at, I always talk about the character of the chart and, you know, when something's in a clear downtrend and rejecting from this EMA for three months, and then it finally gets over, we say the character of the chart is changing. And again, last weekend, we could say the character of the crypto space is changing this past week from what it's been in the last three months. And so that means we have to adjust with it. Because again, if we do the same thing that we've been doing over the last three months, when the character of the chart changes, it's going to lead to losses. Yeah, I agree. I tweeted something to that effect. There's these moments when it's a true shift in the market. And you really,

in my opinion, you could be wrong, but you get really a rotation of how everything should be viewed. Breaking above that 31.8 to me said, it's time to buy dips, not try to short, and that most people are going to have bear market PTSD, and they're going to sell too early. I mean, I could be wrong, but to me, that was the same. And I was saying it, and listen, it was way down, but I think it was when we lost 50 and then 42, certainly on the way down, but it was around 50. I said, listen, I wasn't early on calling this a bear market. I missed 69 to 50, but when we broke whatever that level was, it was a 52 or 50. I said, listen, I wasn't early on calling this a bear market. I missed 69 to 50. But when we broke whatever that level was, it was a 52 or 50. I said, it's a bear market. We made a lower

low. It's not time to look for... I bought some Bitcoin-like investment as I usually do, but it's time now to look for shorts for a very long time until otherwise proven. And now I think it's time to look for longs above that sort of 31.8 level. And I would make the argument that it was time to look for longs once we broke 25, because that made that higher high. Yeah. And I was actually the same back then. Whenever I talk to friends or family, I want to be really sure and have really high conviction. And so I wasn't telling them to take profit in the 60s, but same thing as you. Once we got down into the upper 40s and in that range, I was like, now it's time. We're probably topping out here. It's time to take some profits. So again, yeah,

on the flip side now, and those same people that I said that to are now talking about wanting to add more. And so again, it's just a paradigm shift. I want to talk a little bit, you mentioned GBTC and how it is doing what it should be doing in terms of up to 200% on the year. And so I grouped together these crypto stocks. I look at MARA and Riot, which are on the miner's side. They've got their little subsector. We got GBTC. As we know, it's the trust. And let's see, Coin.

Coin is also in there as well. And so if you look at where these names are, so in July, Bitcoin's hitting 31.8. We're 10%, we'll just call it 10% over that level right now. And you look at names like Coin and MARA, where are they compared to their July high? Coin's down 30 whatever percent. MARA is down 50% from that high. Why is that? Why are they not participating? And the answer is IWM as your gauge. IWM, the Russell 2000 is growth names, low cap stocks. This is where IWM was in July when everything was hunky dory for crypto and those stocks. And it's been doing nothing but going down for three months since then. And it is dragging these stocks down with it. GBTC only cares about maybe the ETF headlines, but Bitcoin's price. But these stocks are factoring in the price of Bitcoin, as well as the indices that they're traded on. And there's correlation.

There's automated trading systems that if IWM is dropping, they're going to be short in these names. And we could see that yesterday as there was a lot of relative weakness. And so I just want to tell everybody, you have to be aware, you can't just make the assumption that Bitcoin's going up, these names are going to go up. And you also got to be aware of dilution. MARA has had dilution come out twice in the last three months. And dilution just means you're increasing your share count. That would be like if you're making Bitcoin out of thin air and selling it into the market. And so that's going to add downward pressure. And it's going to be a lot harder to get back to the levels you came from if the supply of shares is increased. Marathon is using the central bank policy. Just print more out of thin air. It's fine.

And you see exactly what happens. But that's a great, great, great alpha and point. It's hard sometimes to remember that these are stocks. So you have to not only be worried about the correlation of the underlying Bitcoin and the asset, but the correlation to the stock market, which clearly has been struggling here. I mean, I want to talk about that a bit. Obviously, QQQ, maybe these things are starting to bottom. But yesterday, QQQ made a lower low. And we're now way below the 50 MA. It gapped down. So maybe we'll get sort of one of these abandoned baby,

like, you know, morning stars at the bottom. But it doesn't look great to me, man. You know, like a lot of key supports have just been broken on SPY, QQQ, everywhere. Most of them, not QQQ, are below their 200-day. And tech is getting abused. I mean, Google was down 10% yesterday. Yeah, it's rotation where the NASDAQ names are holding up really well. And now we're going through earnings season and they're getting chopped down a bit.

Meta with a bearish reaction, Google. And so it's the kind of thing where the statistic we talked about, I think last week was for the NASDAQ, if you look at the October low and the close of the year, we're green October low to the close of the year, 88% of the time, the last 52 years, extremely high probability. And so I'm almost wondering, drive it down as much as you can in October. And that statistic could still play out. But I'm on the monthly time frame. You know, I look at this chart and say, all right, we just went up all summer. I am anticipating a monthly higher low is most likely.

So I'm, you know, looking forward and I don't do a whole lot of predicting with my technical analysis. But I'm going to be open to the possibility that, you know, we do get a little bit of a year end rally. But the question will be, is that enough? You know, does that just form a lower high? And then we confirm a downtrend. If we look at SPY, there's more space for, you know, maybe we do get a little bit of rally into the year, but then that might just confirm a monthly downtrend. And again, the long-term three months, I mean, it's shaping up a long-term tightening range, all time high, 2020 too low. And now, you And now we just might do this all 2024. And I'm absolutely open to that possibility. Yeah. I mean, if you look at SPY, this is the

daily, right? I'm just drawing this quickly, but you get the idea that we could get some bullish divergence here coming out of that oversold condition. So maybe that is starting to show that we could get a rally up into here by the end of the year before heading back down, sort of as you said. But I mean, you look at this, it's high, low, lower, high, lower, low, lower, high, and now lower, low, below the 200 MA and below those sort of early 2023 highs. So it's the kind of thing where, again, I'm open to a monthly high or low eventually, but I just got to be really skeptical of bulls and just ensure that I don't get this bias. I have to remain burden on proof for the bulls. Prove it, bulls, because the bears have the weekly, the daily, the hourly statement for me is we just topped out this little bear flag bounce. And the simple statement is if we're not over that level, the bulls aren't proving anything.

And, you know, if I'm a bear, I don't worry about anything if that level is resistant. So, uh, it's definitely, you know, a bear bear trends right now and open to the possibility that things shift, but I have to see the proof. I have to see bulls impress me. And they obviously haven't been doing that. Does that mean that you're sort of mentally your base case now is looking for shorts as opposed to looking for longs? Yeah, definitely. I mean, we knew that last bounce, the weekly lower high was the most likely scenario. And, you know, it did a nice job forming where if you look on the futures chart, we double topped. And so it wasn't, you know, it did a nice job forming where if you look on the futures chart, we double topped. And

so it wasn't, you know, a huge surprise to set the weekly lower high at that level where we had the nice bounce, bull flag attempt, but we double topped. And as soon as we break that low, that's a big win for the Bears. And again, it was, you know, not surprising because the weekly lower high was always the most likely result of that bounce. And it was just, you know, do we form it that week or is it one more week? But the bears, again, they just convincingly knocked the price down. The next one for me is, you know, Nvidia has got this range here and we know it's been the star of 2023. And if we break this sideways range bear and lose 400 support, that's going to be further weight on the NASDAQ and further of a hit to sentiment. And so I'm watching that closely over the next couple of days, because again, we're hovering just over that $400 level. And here we are heading down to test it again right now.

Looks like we might be rolling over a little bit. The NASDAQ started a bit strong on the GDP reaction, but giving it back. So again, bears just have confidence. And it's the kind of thing where I'll see a day like yesterday, which was a lot of bear control, and it's just completely writing off the bullseye. I am not going to look long on any trades today. And that can help. If you can compartmentalize your brain and just eliminate one side of the equation, it can make things a lot easier and ensure that you're not fighting the trend. Yeah. I mean, seeing the few stocks that have been holding up the entire market, NVIDIA included, start to roll over. I've been wrong many times before,

but it's hard to imagine what could reverse that trend if they're heading down. Yeah. It's bear rotation. And I got my first real dose of education in sector bear rotation in 2022, where it was a real bear market. And this sector would fall, this sector is holding on well, and then the bears go hunt that one, and then that one dumps after it. And so that's taking place to a certain degree over the last month or two. And that is the question now. Again, I talked about the three-month timeframe and we had Netflix set a three-month lower high just recently and Tesla just set a three-month lower high. And so now the question is, or Amazon just set a three-month lower high. And so now the question is, do the stronger names like Google, it's trying to shape up a three-month lower high and Meta on its earnings reaction, trying to shape up the three-month lower high.

So again, there's just the path forward is becoming a bit more clear for the bears where, again, we're just watching for 2024 to potentially be a long-term tightening range and it might get boring. But the best thing about that is if we do get this long-term tightening range, it's going to be nice and crystal clear when it breaks, whenever it happens, 2025 or whatever. Oh, I feel good about getting dunked on when I sold my meta at 314 very publicly around here. It went down and I was feeling good. Then it was back above. But look at the meta chart right now. Oh, wow.

Yeah. I mean, this is today. And look at the volume yesterday, right? I mean, this is real selling below the 50 a man down. If you guys are wondering about Google, look at that gap between, I guess it was Tuesday and Wednesday. Look at the volume on that selling and look at the follow through today. I mean, this is disgusting. The bears are going hunting and Google and Meta were holding on better. You know, they were hitting 52 week highs when nobody, when none of the other big names

were. They catch up. They always catch up. They're going after those names now. And another one I'm watching for is the energy sector, which has been extremely strong. And I'm looking for that one to roll over. I'm looking at a monthly rising wedge here. And, you know, we just double topped at the all-time high. And if you

look back on, again, the long-term timeframes, XLE four-month chart, it's the only sector that has a stair-step pattern, which is a higher low every single candle. That's still going on for three years now. And so it's time to see that roll over and join in as well. So I'm watching to see if, if the energy sector is going to be next in terms of a place where bears go hunting. Man, I think it's all going down. I don't know. It's been starting to feel that way and, uh, just very, very shaky, but I do hope we at least get a rally into the end of the year, the classic Santa Claus, anything else you're watching before I let you go? Uh, that's about it. Again,

gold and Bitcoin holding on well right now. Commodities, uranium still hanging out. CCJ, uranium still hanging on pretty well, all things considered. So there are places that aren't down nearly as much as others. But again, it's a time to be a bit protective. And I'm not trying to catch any bottoms. Again, I need the bulls to prove to me that things are shifting if I'm going to start getting interested on the long side again. Love it, man. Well, thank you very much. Always a pleasure to have you.

And I will see you next week, guys. Follow Chart Guys on X. Also, check out his YouTube. As always, get a whole lot more than just 23 minutes of Dan. It's better over there, man. Thanks again. Thanks a lot, Scott. Wow, guys, that was a lot to unpack today. Market's looking shaky, but nice to see that

Bitcoin is hanging out in the middle of there. Christopher Walker asked, why is ARK selling? They sold some Coinbase and some GBTC because they're traders and it's a fund and they have to take profit and have a fiduciary duty. When something goes up 20%, 30%, you sell something. They didn't sell it all. And that's what you do. There's the trading side and there's the investment thesis side and they got to sell when things are way up, at least a bit. That's all I got. All right, guys, I will be back tomorrow, of course, with the Friday Five. Nathaniel Whittemore has been my favorite. It's been really amazing every single week. And of course, heading over to Twitter spaces now. I will see you guys later.

Bye.