← The Wolf Of All Streets
The Wolf Of All Streets
Bitcoin Whales Dump $45B While The Fed Pumps In $50B To Save Markets!
00:55:41
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- [00:01]
A
Bitcoin whales continue to dump their Bitcoin. 400,000 coins last month and another $45 billion worth on this correction. Obviously, as we discussed on macro Monday, we also have the Fed injecting a ton of liquidity at least through the reverse repo. $50 billion one day, over 20 billion another. There's a lot going on under the surface leading many to think that we are in the depths of a bear market. It's all over, I think. We're so back. But I'm going to discuss all that with one of my all time favorites, Mr. Mark Yusko. Let's go. Let's dope. Good morning everybody and welcome to the depths of hell. We are in a bear market. Bitcoin had the audacity to temporarily drop below a hundred thousand dollars. Unimaginable levels of lows. I can't believe it could possibly go that low. Mark, of course I'm being sarcastic. I'm old enough to remember earlier this year when I was euphoric when bitcoin broke above $100,000. $100,000 bitcoin, yeah.
- [01:17]
B
I mean let's, let's zoom out a little bit, even just a little bit. I mean a year ago, right. One year ago we were 56% lower. Right now people say oh, but, but if you fast forward, you know, a month, which it, which is true, you fast forward a month, you know, we're coming up on the, the period where from December, you know, mid teens last year, we're flat like, okay, but to your point, it's still $100,000 per coin. And we're having a interesting period here in that we run a venture fund, Morton Creek Digital. And our first fund we invested in 2018. And long story short, 80% of that goes into equity, 20% goes into digital assets. We got a meaningful amount of bitcoin in there. And you know, we have to return the capital to shareholders, not our money.
- [02:28]
A
Right.
- [02:30]
B
And you know, most of us who are invested in it are going to take it in kind, but there are some that they can't do that for, for institutional reasons. So now, for the first time ever, will, we will sell some. Now we haven't done anything this moment, but that is no reflection on price. But the point of telling the story, their cost basis, $5,000, which is not that long ago, I mean we're talking 7, 8ish year, you know, years, it's just not that long ago.
- [03:05]
A
Is if SBF had been running your fund, he would not be returning that money to investors. Just for the record.
- [03:11]
B
Just for the record. And hey, there's one, one quick thing, you know, you, you opened it up talking about, about the whales. It is interesting. You know, we were on kismet that, you know, the prep. So I'll, I'll see if I can do it. But I did wear the, the bitcoin whale sock game today.
- [03:29]
A
Wow.
- [03:30]
B
Which is kind of funny. I mean I didn't, I did not plan that we would be talking about the whales. But, but I did wear it today.
- [03:39]
A
But I mean, tis the season to be talking about the whales because that has been the story, Right. That's been the offsetting supply that has, I guess, sold into all of this institutional demand that we see there. All the inflows from the ETFs. I mean, it's indisputable fact at this point, these guys are selling not all of them, but they have a lot more coins than people seem to imagine. When these guys can just send 10,000 coins here, 50,000 coins, there's 30,000. I guess we can debate endlessly why they would be doing that. I think there's a lot of obvious reasons, but it never ceases to amaze me just how much money these guys have in bitcoin.
- [04:18]
B
Well, I mean, for sure. Again, because if your cost basis is pennies or fractions of a penny, in some cases, the sign right behind me.
- [04:31]
A
Right.
- [04:31]
B
Is not the real one. It's, it's, it's a, you know, Christian made it for me, so it's, it's kind of a semi original, but it's not the original one from the Yellen Conference. And I kind of wanted the original. And I asked him if he'd sell it to me. He's like, no, I think I'm gonna put it in a museum. Like it will be in a museum, my museum. And I would share it with people. Anyway, so he decided to put it on auction last year. And you know, I decided, okay, I'll bid for it. But I knew this would happen. There are lots of people, like, lots of people who have way lower cost basis than I do.
- [05:07]
A
Yeah, like bitcoin cents.
- [05:10]
B
Well, this guy was single digit pennies. And you know he's, and it's a funny story, right? He was sitting at Pub Key and the rumor is now I don't know if this is true or if it's an embellishment. Someone said, hey, is this some random homeless guy off the street? Because he, he, he looked a little scraggy and he, you know, he wasn't Dressed in a suit and had, you know, kind of rough beard. And then he bid way more than anybody else. And it was not real money. And I, I, it's not, it's not that it's not real money. It's to him, the cost basis is zero. So he can buy something he wants.
- [05:50]
A
Which is kind of incidentally infinitely. And so these guys obviously would sell for, for that reason. It's just too much money. They got 10, 15 years older, they had families, they want a yacht instead of driving a Corolla from 85. Like Government and Blackrock. They've seen Blackrock and the Government come in and start, you know, maybe violating some of their libertarian ideals and they're like, eff it. And the funny thing is that some of these guys could be selling $10 billion worth of it and still have 90 billion more.
- [06:20]
B
Oh, no, no, exactly, exactly. The one, one thing that bothers me, we talked a little bit about this before we went on air. The relatively small amount that can cause meaningful moves in price is still bugging me. And you know, this is one of my personal pet peeves about market cap. Generally. You have all these, you know, I'll call the altcoins, right, that claim to have these big market caps. Like you're taking the last like 10 tokens traded at some price, multiplying that by billions of tokens and getting a market cap. If, if the person who formed that token were to sell one, not, not like five or ten, one, like if Elon sold one dogecoin, what happens to the price of dogecoin? It goes down a lot. But bitcoin shouldn't in my mind be quite like that because yes, we do the same silly thing. We create the market cap by saying, oh, if Scott and Mark exchange a Bitcoin for $102,946 and there are 18 million ish Bitcoin, then the market cap is, you know, 2.1 trillion. Okay, but we sold one Bitcoin. You can't price a whole market based on one transaction. But that's, that's the way we do it in, in all assets.
- [07:49]
A
Yeah. I mean, if the Satoshi wallet started moving coins around, but I don't think that's going to happen. It might, it might shake the trust and might move different than its market cap would imply, for example.
- [08:00]
B
Yeah, no, exactly. And, and look, the, I think the other thing is I, you know, I, I'm on record that we are in crypto winter. Now, I didn't say exactly the date, but in In February, I said that, look, the four year cycle's not dead. Humans are going to human and we will, we humans will push the price above fair value. I mean, you know, Tim Peterson, where.
- [08:30]
A
Do you, yeah, we've talked about this a lot. Where do you see fair value now?
- [08:33]
B
Just as I just talked to Tim, I talked to Tim for a long time on Friday, I had a long car ride and we just, we just chatted. 91,92k is fair value. And I say you can't determine, like he's been doing it for eight years. And it's pretty damn accurate. And the idea of Metcalfe's law applying to networks, and Bitcoin is clearly a network and we can gather all of the inputs into that network and we can calculate a number. And if that number tends to correlate to the price over a long period of time, one might say that the model has some value. So, and what's crazy to me, you know, you guys, you and I have been doing these kind of things for a long time. So back in 2017, the fair value was 10 and we hit 10 within. Actually, this is crazy. Within four days of the model, the model said November 6th, it hit November 10th, and a month later we were 20. Well, if you're two times fair value, what is likely to happen? Now, interestingly, it happened precisely on the day. And you knew I would go down the sinister pattern path here, but precisely December 18th to the day that the CME released futures contracts.
- [09:55]
A
Yep.
- [09:57]
B
And that goes to about six months earlier when Leo Melamed, the chairman of the CME, said, Look, we will tame bitcoin. Like, that's a weird word that, that, that's a, that's a, that's a confrontational word. So what does that mean? Well, that means that if I can. In the old days, if I wanted to sell you a bitcoin, I actually had to have a bitcoin. Just like if in the old days of oil, if I wanted to sell you a barrel of oil, I had to have ownership of said oil. But in the futures market, no, no, no, no, no. I can create something out of thin air in paper and I can just execute a sale. So the price collapsed from, you know, 20 to 10 to 6. And I, this is the one thing I am nervous about, Scott and I, I don't think it's going to happen, but I am nervous about it. If you remember November 6th, back in 2018, we were sitting at 6K and everybody's like, okay, that's it.
- [11:03]
A
The bottom man, that 6K floor.
- [11:06]
B
And holy crap, I mean, it was.
- [11:10]
A
Half gone in 12 hours.
- [11:12]
B
Yeah, 24 hours. It might have been 36 hours, I don't remember, but it was super fast. And we were at 3400 and everybody's like that that can't happen. Well, it just did. And so then, okay, we start going back up. So then we get to the 21 cycle and we get to, you know, fair value had crept up to about 32, 33K. And we went all the way to 69 and again to the day, November 21st or something like that. CME releases more futures, more weapons of mass destruction, and we top at 69 and go all the way down to 15. And now at 15, if fair value is 40, what happens? Investors start to accumulate. But then we go back. So now here we are and what's interesting is every halving we add a 0, meaning we 10x the market cap. And that's kind of the parabolic Metcalfe's law kind of model is went from 10 to 100, 100 to 1,000, 1,000 to 10,000, 10,000. This time 100,000, which means the next halving we go to a million. And we're like, that can never happen. I'm like, no, it can and it, it actually will. Yeah, but, but, but I don't know, it's not gonna be a straight line. So my point is, in February I said, look, contrary to popular belief, four year cycle's not dead and we will enter fourth quarter and we will have a peak, a speculative blow off peak, just like the last ones. And depending on how high we get above fair value will have, you know, that type of correction. I didn't think we'd get as high as 2x. Right. We were 2x and 17, 2x and 21. I thought this time we'd hit 1 5170, which would have been, you know, 50 to 70% above fair value. A fair value is ticking around 100. Long story short, I, I also, and I didn't get too specific on this, but I did change my view a couple of weeks ago when I saw that the tweet from the guy from two years ago who said October 6th was going to be like, yeah, and, and there's a reason for that, is it's not a four year cycle, it's a number of blocks cycle. And the number of blocks is one month less than four years. So December 18, then November 21, October.
- [13:48]
A
6 was, I think the top is in. You think the Top is in.
- [13:52]
B
No. So I, I, I, I'm not saying it is, but what I'm saying is it's possible.
- [14:00]
C
Right?
- [14:00]
A
Sure.
- [14:01]
B
That the difference, the difference is. But Mark, things have changed. There's more institutional demand. Yes, there is, Mark. Things have changed. The ETFs.
- [14:11]
C
Yep.
- [14:12]
B
But what hasn't changed is human nature to lever up. You said million dollar idea don't get liquidated, right?
- [14:22]
A
I know, it's crazy. Crazy. It might be a million dollar idea just for one person, but, but here.
- [14:28]
B
It'S, it's a crazy, crazy phenomenon. And I, I shouldn't rat out my family member. I won't say which one, but I shouldn't rat him out.
- [14:36]
A
Your brother.
- [14:37]
B
But I told the story before. I know in the last cycle he calls me and said they stole my bitcoin. Like what are you talking about? Well, I was on Bitfinex, I'm like, stop. No, no one stole your bitcoin. Now some might argue that that is their business model. Lure people in with the promise of riches and then when they can't make the margin call, you confiscate their bitcoins. And maybe you could call that theft. But, but the reality is you chose to lever up your Bitcoin 50 to 1. You don't lever an 80 volume asset 50 to 1. And unless you plan on being less rich.
- [15:14]
A
Yeah, I don't. Personally, I think it's going to just be boring. Between 100 and 125, I have no idea. But that's what, at 126 I was like, we'll probably range down to 100. And here we are and people are in shame.
- [15:27]
B
And that point, Scott, is important in that if 126 was kind of all the juice we had in terms of the over leveraged because there's less leverage in the system and, and so much spoofing going on. I mean the amount of spoofing going on by JP Morgan, I shouldn't name names, but, but by the big dogs, right? That we can name names. But, but we know this is happening, right? They do it. See, commodities are an interesting thing. There's a reason I believe that bitcoin was, was called a commodity, not a security. And everybody's like, oh no, that's great. We didn't want to be a security. Be careful what you ask for. I believe it was intentional to call it a commodity so that Leo Melamed and his buddies and the big dogs could use paper to manipulate the price. And so that little thing that everybody thinks was an Afterthought. Oh, they didn't.
- [16:32]
C
They did.
- [16:32]
B
They couldn't figure out what it was, so they just called it a commodity. No, no, no. It was intentional to make it a commodity because commodities can be controlled.
- [16:41]
C
And so.
- [16:42]
B
But my point is, if fair value is 91, and let's say it's somewhere between 91 and 100, because you don't have perfect accuracy and we only got to 26. 126. A 26% kind of premium to fair value doesn't need an 84 correction or a 75%.
- [17:02]
A
That's right. So it only means we're just becoming more boring. Yeah, yeah. And so, you know, we just got to 99. Maybe that's just one of those close enough things.
- [17:12]
B
Yeah. And I, Look, I, I am worried, you know, a little bit.
- [17:18]
C
A little bit.
- [17:19]
B
And I talk for, with Tim a lot about this, that there is this kind of super cleansing that has to happen in these periods where you basically got to wipe out all of the leverage.
- [17:36]
A
Have you looked at altcoins and the $19.2 billion leverage unwind on Binance and Friends a few weeks ago? We've had some pretty brutal times. Like, it's easy to look at Bitcoin and say it's pretty good, you know, 100k, I'm happy. But meanwhile, like, your altcoins are in the dumpster for a lot of people.
- [17:55]
C
Oh, no, no.
- [17:56]
B
Look, I promised, I promised you I wouldn't pick on the XRP army this morning.
- [18:01]
A
Did you see this? Wait. Yeah, Wait just in. Ripple raises 500 million at a $40 billion valuation. Did you see that?
- [18:12]
B
No, I did not.
- [18:12]
A
Wow. See it now. It was like Citadel securities and I mean, some huge names obviously in this round here just happened while we were talking. I saw it.
- [18:23]
B
I mean, now, again, Ripple is not xrp, but, but bravo to Brad. I, I, I can only give him golf clap on that. I mean, that, I mean, Citadel securities are real people. Yeah, they are super real people. I assume Paradigm is probably in there too. They tend to do a lot of stuff together. I don't, I don't really understand Fortress.
- [18:49]
A
And Citadel securities for. I don't know who else is in there, but probably Paradigm, I'm sure.
- [18:54]
B
Yeah, yeah, I, Bravo. I mean, that's, that's a stunning development in my mind. Really good, actually. Really good for me now that, now I think about it, because I invested with Dan Moorhead, who was one of the earliest investors in Pantera. So the value of our Pantera investment probably just went up by A lot, actually.
- [19:14]
A
Yeah, you were starting by saying you weren't going to pick on anyone. Then I interrupted you. Maybe you were going to. I don't think. No, no, no, I wasn't picking anyone. But I think we have a fair value problem across the crypto ecosystem is maybe where you were going.
- [19:26]
B
Yeah.
- [19:27]
A
As you can watch altcoins literally go to like zero and back in a day. This is non specific to xrp, like all of it. Right. So what's the value of any of these? If the networks are like, maybe if.
- [19:39]
B
You'Re a meme coin, you have to understand, like when Janet Yellen or Christine Lagarde, the evil women of the world, when they say these things have no value, no intrinsic value. Like, you mean different from the euro or the dollar which has no intrinsic value. I can't exchange a dollar for anything. I don't get gold, I don't get silver, I don't get tax receipts, I don't get war reparations, I don't get anything. It's just belief in custom. But belief in custom is different in the sense of, if there's belief and custom broadly, then an asset can be used as a medium exchange or a store of value. A meme coin monetization of attention. I mean, for a moment it can go to crazy numbers, but unless you sell it and convert it into something where belief and customers like, you can't go anywhere and buy anything with dogecoin or you know, fart coin or. But if, if, if you sell.
- [20:50]
A
I remember when you could buy Maverick. I remember when you could buy Dallas Mavericks gear with dogecoin, apparently.
- [20:54]
B
Ah, okay, all right, I stand corrected. I stand corrected.
- [20:58]
A
For five minutes maybe. No, go ahead. Sorry. All right.
- [21:01]
B
No, no, and look, I, if I were Mark Cuban, I, I would try to create something, you know, but moment.
- [21:08]
A
In time that was, Those were all top signals, by the way.
- [21:11]
B
Of course they were. Because look, I, there are thousands and thousands of tokens. Because creating a token is, is not that, that challenging. I mean, I, you know, it's not something I do every day, but there are people who can do it in, you know, five seconds. So that, and then promoting it and getting people to believe in it is, is a whole nother thing. And as I say, the XRP army or the, you know, Cardano Army, I mean, these are rabid believers. And you know, the, again, if you do the market cap, they look like very big assets. But I will contend that if anyone tried to sell any amount of that asset, the market cap would vaporize I.
- [22:00]
A
Think we're going to eventually prove all of those theories right with most of these tokens obviously. And there's something I know that you think is sinister and like to talk about. So I actually happen to randomly have three stories about CBDCs today.
- [22:14]
C
Awesome.
- [22:15]
A
Bond will settle with wholesale CBDC. Here comes Hong Kong CBDC with stablecoin mechanics. Indonesia is digital rupiah to be backed by government bonds. And of course Christine Lagarde digital Euro. CBDC is a symbol of trust in our common destiny of eating bugs and liking it.
- [22:34]
B
Yeah, look, I mean there is not a human. Well actually there's one other. She's the second worst face of evil on the planet. Augustine Karstens or whatever her name is the worst. But Christine has always been the face of evil. I mean she's been doing bad stuff for a long time and it's not shocking at all that people are moving to governments are embracing CBDCs. Why? Well, and I give full credit to Pippa Malmgren. So Pippa's dad was Department of State guy for years. Passed away, Rest in peace. But Pippa has been talking about this for a while in that.
- [23:27]
C
When a.
- [23:27]
B
Government gets overly indebted, right, they basically have four choices. You can pay off the debt. Well, they can't do that, right, because they just don't have enough wealth or capital to do it. So then you can restructure the debt. Well, no one will take the other side, right? If I own a treasury, you can't say I'll give you 60 cents on the dollar because I expect a dollar. You can default. But then you get kicked out of power, right? You know, AKA Argentina or Venezuela or whatever. So that, that's bad. Politicians don't like to default. So what do they do? They devalue. Well, devaluation is why currencies all go to zero, which is why bitcoin goes up. Because bitcoin doesn't change. One bitcoin will always be one bitcoin. Like one ounce of gold is one ounce of gold. What changes is the number of dollars or rupiah or euros that you need to acquire. Said one. But the, the real problem here is back in the 1830s the UK, right, which was the. Remember the UK was the center of the universe, world reserve currency, most powerful nation in the world. Sun never set in the British Empire. They owned pretty much everything and everyone. Not, not so nice actually. But they got super indebted. You know, they financed a bunch of foreign wars that they couldn't cover and, and Back then, the way they kept records. This is crazy. Is using pieces of wood called tally sticks. Like I would lend you money and I would make a notch on my stick. And I'd make a notch on your stick and I gave you, wait for it, the short end of the stick. Yeah, which is where that phrase comes from, Right? You got the short end of the stick. So you were the debtor. Because remember, if you were a debtor in ancient times, you were a bad person. Like you could go to debtors prison. And it wasn't like today. Oh, I have a big credit line. I'm a big man or a big woman. You know, I got this big credit card, but it's debt. How much would you use your little plastic thing called a debt card instead of a credit card? I don't know, probably less. But long story is, I had the long end stick, you had the short end, the stick. And if I were a big financier, I'd have a bunch of these tally sticks. Right. Well, the government says, you know what, we're going to get rid of all that. We owe you guys a bunch of money, but we're not going to pay it back. So. So we're going to collect all the tally sticks and we're going to burn them and we're just going to start over. We're going to adopt dual entry accounting. You know, Medici kind of dual entry, green eye shade, ledger pads. And the funny part of the story is they burned Parliament down while they were burning the tally sticks because the furnace caught on fire. But they did, they reset. Now, who won, who lost? Well, obviously the government won because they stayed in power and they didn't have to pay back any of their debts, but they had to adopt a new monetary system. So let's think about this. Governments all around the world, too much in debt, can never pay it back. We owe 38 trillion. No way we're going to pay it back. So what if you created this new accounting system, this new monetary system, and you flush the old system. Okay, that, that's, that's totally logical. So this is our tally stick moment. Oh, but wait, it's better. Like in, in the green eyeshade, you know, to, to ledger system. You actually need a bank. Okay, the Medici's to be the referee, right? Because you write down a number, I write down a number, I could change my number, but the bank, you know, is the arbiter and got accountants and auditors and $7 trillion of, of slippage, which everybody loves. Well, now we got this Programmable thing. Well, wait a second. Like, if you listen to Augustin Carsten, it's like, well, of course we should determine when and if you can actually use your money. Like you get paid. And the CBDC can say, well, unless you spend your money by Friday, it goes away. And hey, you know what? Target just made a little contribution to the party, so your money doesn't work at Walmart anymore. So, I mean, you're like, that could never happen. Bullshit. All of that can happen. And worse, way, way worse because now we got digital id. Oh, you want to go on vacation in the uk? I'm sorry, you said something bad about the Prime Minister. You can't come in. I mean, it is a dystopian nightmare. And if you want to get me really started, let's talk about the digital gulags that are being built by Sam Altman and friends under the guise of AI. No, it is. It is. It is not intelligence in any way, shape or form. It is completely artificial. But more importantly, it ain't about anything other than control manipulation and, and slavery. Like, let's think about this. You go into the open AI, you know, product now, and it won't give you health advice, it won't give you financial advice, it won't give you legal advice. Who made that decision?
- [29:08]
A
Oh, it was going to give us health advice. It was giving us all health advice till, like, last week.
- [29:12]
B
No, that's what I'm saying. But, but, but here's the thing. They. So. So someone. I mean, the idea of the Internet is all of mankind's information is open and available to anyone who wants it. The name open AI implies, if you ask me, you know, I'm not a linguist, but it implies that this is an open system, not a closed system. That. Look, if I ask Google a question, I know that the answer is mostly paid for. Like, they're giving me back ads and stuff. And like, if I asked for, you know, what's the best stroller for my grandkids? I actually don't get Consumer Reports anymore or, or strollers dot com. I get someone trying to sell me a stroller. So I. I get how that model works, and I can ignore it and I can kind of search through and find the place where I could find about strollers. But in this new world, this digital gulag, they're like, I don't like the fact that you asked a question. You're not supposed to be talking about strollers. And let's make it real. Okay, forget strollers. How do you make A bomb. Okay, maybe it's a science project for my kid, but you can't say that. And, and now the, the AI will say, well, that information is not available to you. Oh, and by the way, we've notified the proper authorities and they'll be at your, you know, home to pick you up. Like, but it's a science project. I mean, and, and I get it that there are delicate things and there are things, but I'm probably in trouble for even using the word on, on the Internet.
- [30:59]
A
So they're listening.
- [31:02]
B
Well, actually to that point there was a time here in Chapel Hill during the whole 911 stuff that this student rented a van and drove into the main square of the campus. It was a Middle Eastern student. And so someone emailed me and said, hey, what's this jihad stuff going on? And I said, dude, do not use that word in my email because yeah, the GMAN are listening so well, the.
- [31:31]
A
CBDC people are definitely coming for parts of the world. I think that's very, very clear. There's a billion more things I want to talk about, but we've reached our.
- [31:40]
B
Time, Mark, you know that is always the way it goes with you and me. Scott is part of it. As my wife says, Mark, you talk too much. And like. Yeah, I do.
- [31:50]
A
I like to talk, but I get that from my wife too. What are you going to do? Well, thank you to. I guess if you're Marky Mark, I'm the Funky Bunch.
- [31:58]
B
Absolutely. And, and give. And give your better 90% to me.
- [32:03]
A
I will.
- [32:04]
B
You know, I, I like. Yeah, yeah, you're good. You know, you have great presence on the end but you know, Emmy, Emmy ups the game every now and then and, and does a good job.
- [32:12]
A
So it's, it's not easy being me sometimes. I gotta say, same for you, buddy. Thank you so much, Mark. We'll see you very, very soon.
- [32:19]
B
All right, see you, Scooter.
- [32:22]
A
All right guys, obviously got Christopher Inks coming on next to discuss how it's all over again. Because that's what we're talking about. But first, obviously, since it is Wednesday and we've got a year of doing this, check out all the incredible things that Aptos did in October. Major partnerships, record breaking performance milestones, exciting ecosystem developments and events. From Token 2049 to Aptos Experience. NYC Global Trading Engine is taking over and Alpha Team Aptos recorded it all. You can check out that thread right here at Alpha Team Aptos. Check them out, support them, they support us. And now Chris, it's all over New York City is now a communist country. New York's over. In 48 hours it'll be done. Bitcoin now has hit $100,000, which means global markets are officially in shambles. We are in a great depression. We have the fourth turning.
- [33:16]
C
Yes.
- [33:17]
A
Did I miss anything else? Is there anything else that happened that is a symbol of the end of the world that I might have missed?
- [33:23]
C
I don't know, probably the great rapture or something like that is coming. I think it's all tied into Bitcoin breaking 100,000 downside.
- [33:32]
A
Can I show you something?
- [33:33]
C
Go for it. No.
- [33:34]
A
While Mark was going, because I have ADD and whatever, and I definitely have heard him tell me about his brother in law before. I brought up this chart of bitcoin corrections that I had that I forgot and I just wanted to check in on it. This is just this cycle.
- [33:50]
C
Yeah.
- [33:50]
A
Since the lows. Okay. Since the 22 lows. 22%, 20%, 22%, 21%, 33%, 32%. Right now we're at 21.7% and price is above a hundred thousand dollars.
- [34:04]
C
But it's the end of the world.
- [34:06]
A
I think it feels worse than a lot of these. Like, even when we went from 100 back to 74 here, I don't think there was this much anger and depression. I do remember this range from 31 to 25 that happened for. Oh my God. From April to September.
- [34:21]
C
First experience of that long extended side.
- [34:24]
A
Two corrections. That's why when I joked like we could range between 125 and 100, people are like, no, well, here's, you know, the five, six, seven months of that kind of thing after hitting a high. But dude, why are people.
- [34:36]
C
There's out. There is actually a reason for this. You know, we've talked about it multiple times before, right? That it seems like, you know, all the major gurus on here have been calling tops. Every time, right? Like 20,000. Every time we pause for a bit, they'd be like, oh, the top's in. Right? And this has been one of the most, I think, emotionally difficult bull runs that bitcoin has had. And I think a lot of that has to do with the. A lot has to do with FTX and what happened that last time. You know, people haven't really gotten over that. And so basically what we're doing here is climbing this wall of worry. I mean, we've been doing that for pretty much this entire dang bull cycle, which is weird. And what that means is psychologically, structurally, psychologically we're in a bear market, right, in our heads, but financially we're, we're in a bull market, right? Things are still going up and, and this, this happens at times with human beings, right? And you have this really tough time of it. And at this point, you know, people are so worn out, so just completely dragged down and let's face it, you know, everybody keeps coming up here. Oh, it's not, you know, it's, it's, it's the same cycle as last time, whatever, but it's really not, you know, again, we have those long periods of sideways, which we haven't had before, especially after institutions came in with the ETFs there in January of, of 24. And so you kind of get this thing right. Was waiting for this big blow off, he's waiting for this big run. Everybody's thinking 2017. You and I were trading that 2017 together there, especially, you know, the last couple of quarters, especially that last quarter, man, it was crazy. But, you know, and everybody's still looking for that and they're not getting that. And so, you know, it's, it's a lot of, you know, as I often say, the only real thing that you're fighting in the market, the only person, the only thing you're fighting is yourself. You're not fighting Wall street, you're not fighting crypto whales, you're not following anybody else. The only thing, the only person you are fighting is you in your own emotions, your own psychology, the way in which you're having to deal with this stuff. And, and that's, you know, again, that that's the big part of trading that most people don't understand. They're all out there thinking, yeah, everybody tells them, oh, it's a zero sum game, it's this and that. But at the end of the day, it really is just you're fighting yourself, right? So as I always say, trading is simple, right? We're just moving via liquidity. But it's not easy. And it's not easy because we're dealing with all that emotion and all that stuff that actually makes us human.
- [37:07]
A
So can I show you something else? Because there's people in the comments saying that nobody's freaking out. So I just, I just want, before we show Chris's charts, this is the S and P currently, I mean, actually from right now, if I pull this over, it'll be a little better. So we're down 2.17% off the highs all time high of, I don't know, five days ago. The fear and greed index for the stock market is extreme fear. People are literally losing their minds. 2% off all time high. I don't think I've ever seen that. By the way, there's more fear by this index in the stock market than in crypto, which is at 23. Yeah, we had extreme fear for both the markets we track.
- [37:50]
C
Even though we continue to make new.
- [37:52]
A
All time highs, people are freaking out.
- [37:56]
B
Right.
- [37:56]
C
And so it's just that, you know, again, it's that, it's that whole what we call climbing the wall of worry, right. And it, it hurts a lot of traders and, and people want to invest because they're too scared to get in. So you get a lot of dry powder sitting on the sidelines. I mean, We've got what, seven point, almost $8 trillion money markets. Yeah, I mean, it's just sitting there. Why you got, you got Warren Buffett who's been out in cash for what, two years now, something like that. And right now he's got this record stupid level of cash just sitting. I mean, just absolutely insane how much cash he's got just sitting there. But you know, this, this is what happens. And so, you know, until something structurally breaks, you know, on the charts, you know, we just keep trading it with the bias to the upside. And so, you know, when we're looking at Bitcoin here, yeah, we got a little dip further. Right. So what we talked about previously, we've been talking about is okay, we had the move down here and we needed, you know, a quickish move back up above here. We got the thump and then we got the pullback. And I was like, listen, we got to do this here in a couple of days or else, you know, we're probably coming down. And as I told you know, our students there, if we were losing this, our target was going to be this, this monthly S1 pivot here and which just so basically happens to align. This is that 50 EMA on the weekly that everybody's talking about sitting right there. And so they kind of align the same area. The other thing that aligns here is something I've been talking about for a while, you might remember is this red line here. Every time we did a major pullback this cycle, it's been right here to this, this kind of 44ish area on the RSI. And here we are kind of sitting right above it there right now. So, you know, everything's kind of coming in. You know, we took the liquidity there, we kind of took some liquidity right Here, you know, to me, this is a really good area to watch right here because you have this wick up here at about 97, 921 on this chart. And then you have the wick down to 98, 330. So basically that same area right there. And that's always something that you should watch when you have wicks coming up and coming down and hitting the same area that. Just a little quick tip there. Always watch that. It's a strong area there. But anyway, we're right there above that, but we're hitting these levels where we always, you know, this cycle anyway has provided support. So again, nothing's breaking down on the macro right now at this point, even as far as pivots go.
- [40:24]
A
Extreme fear.
- [40:25]
C
Yeah, yeah, we're still above the yearly pivot here.
- [40:28]
A
Have you ever seen like, not that that's an indicator I watch so often, but have you ever like just glanced at something, been like, we're at an all time high. We should be, that should be literally extreme gear, greed, euphoria. If you think the top is it.
- [40:40]
C
Yeah, yeah, exactly. But again, very hard to have a.
- [40:42]
A
Top when there's extreme fear. For the stock market. I'm talking about right there.
- [40:45]
C
I mean. Right. But you know, this is what, when, when they say climbing the wall of worry, this is what they're talking about, right? This exact situation where structurally, psychologically, we're basically in a bare market, you know, in our heads. But the, the, the financial itself, the markets are actually in a bull market, right. And that's that thing, right? Because everybody's always worried and it wears you out a lot worse. That's why people are probably feeling like this is so much more difficult than it's ever been. Even though it, you know, if you look at the chart, it really hasn't been. But for them it has been emotionally. And not just here, but also again with, with stocks. Right. I mean, everything keeps going up. The, the freaking dow's almost at 50, 000. I remember, I remember when it was below a thousand back, you know, before 2000 there. It's absolutely insane. But. And things will continue to go up here. Now here's the thing. Because of that, that dichotomy, because of that, that twist between what people are feeling and what the market's actually doing. Your point about euphoria is really important because if we don't get that euphoric feeling popping out with it, then when the market does roll over, it can be really rough, it can be really tough because you don't have anybody to sell into because everybody's sitting on the sidelines, everybody's out, nobody's really buying. And that's the big kind of. The big kind of concern with it, you know, as we continue higher. But right now, structurally, you know, again, I think we're still looking all right here. Nothing's broken down yet. For me personally, I mean, I could see us potentially taking another push down. But right now I. We've got a real good look at those tweezers.
- [42:23]
A
If we can hold like this and rise. Look at that candle.
- [42:26]
C
That's support. Beautiful. Not even just tweezer bottoms. It's at support, which is huge. It's huge, right?
- [42:31]
A
These are bottoms at support. With a nice hammer, like, I can zoom in on mine just to give the idea. I mean, day. Day ain't over. We got, you know, nine hours and 13 more minutes. Anything can happen. I don't want to, like, go full Leon let and celebrate at the one yard line and fumble, but. Yeah, I mean, come on.
- [42:50]
C
Yeah, I mean, you know, you should at least be looking for possibly to get up here around 106 or so. I think we probably. There's a good chance we could do that even today. But here's the thing. Big picture for everybody watching here. Here's the thing. If this holds where we're at, or even if we dip a slightly lower there and we break out with a daily candle, impulsive breakout and close above this 113, 150 area, that's going to signal the low is most likely in and we're going to new all time highs. Now, based on this one, two count here, as I've adjusted it, I've got a wave three up here at around 180,000. So we get 180,000, Tom, pull back to around 150,000 and then rally up to right around 200,000. And those are just generally projected targets that we use every time with Elliott wave. It can overextend. You can get higher movements or shorter pullbacks, but generally speaking, that's what we'd be looking at. And for me, personally, I like those numbers. You know, the fact that we break through 150, pull back to 150 and then hit 200. These are psychological strong levels that you would normally look for as. As support and resistance and whatnot. So I. I like the setup here. I'll be honest with you. So. But we'll see what happens. You know, again, it's like everything else that I talk about. You know, there's levels you want to see broken out. So for me, you know, if you look, if, if this is going to be correct here, this is three waves down. So really just a breakout above this swing high here around 111 2, 111,000, 200 or so. That should indicate that the law is. If my count's correct, that would indicate that the low is in breakout a little bit before your 113, 150. You know, if you're doing Elliott wave, you've got to break out above the wave X here, which is the all time high unfortunately in this case at 126. But those are the levels I would be watching there. But you know, again, if you're sitting here and you're worried, you're whatever. First of all, understand we're at a great place through all the support levels I talked about and everything we're looking here. If we can just impulsive breakout and close above the 113, 150, we should be good to go overall, you know, I mean, we're get pullbacks along the way but overall we should be breaking out there. And I'm looking up toward 180 is the next kind of target on that.
- [45:03]
A
I mean, listen, I was never like the biggest MA guy but I think it gives you some at least guidance about where mean reversion will happen. It's been tested three times on the weekly 50 since breaking above in 23. I mean, and I kept saying, even yesterday before it was happening, I was like, we're good. I want to see it tested and I want the week to close above it with a big wick below. Not as big of a wick as I was hoping for yet, but sitting right on it today after the flush with a wick below. So listen, if it ain't broke, don't try to fix it. If we start closing a bunch of candles below that, if that's your thing, I get it. But like you can't know something is support unless you test it. So I don't know why people freak out until you have proof that it's broken.
- [45:44]
C
Well, you know, it's because, you know, for a lot of people, you know, people take offense when I say this, but the reality of is most retail market participants don't know what they're doing. And so they get in and they hope that it's going to go. Maybe they listen to somebody online and they hope, maybe even listen to me. Right. Had no idea how to apply. This is the biggest thing we have is people don't know how to apply the information and that they can get online, right? So even if the information is correct, if you don't really understand proper risk management, how to apply that and what's going on, you can still mess it up, right? But people buy in and if price doesn't go up and continue to go up, you know, it negative because you don't really know what you're doing. It's very traumatic emotionally because every time it pulls back you're like, oh my God, should I take my profit or should I let it run? Right? And that's that big thing. And if they've been in a few times, maybe they've taken their profit a little early because they got scared and it continued going up where they thought it would. And so then that plays back in their head as well. And so, you know, again, it comes down to the whole idea that the thing that you're fighting in the markets is yourself. I mean that's, that's what it is. So I think, you know, right now we're looking good. We just need follow through. We'll see if we can get that Ethereum. Everybody's freaking out about Ethereum, right? But again, same idea. We've got a, you know, WXY here, a double zigzag correction again, support at the S1 pivot monthly. S1 pivot. We kind of swept all this, you know, right here and here, all this liquidity getting into this. So again, we want to see it hold here. Based on the structure here, we just have to get above this triangle resistance of wave X here at about 39.16 to indicate the low is in and we're going to break out higher. But like Bitcoin, if you can get a daily candle impulsive breakout and close above this 4009 area, that, that should indicate that you're good to go for a new all time high with, with, with Ethereum here. Now the big thing on, on Ethereum and you know, in Bitcoin itself is if you look at this move down, so you've got your initial volume on that October 10th drop there, right? But coming from there, volume just continues to stay off, continues to drop off. You're not getting like, as this is coming down, you're not getting volume expansion. Like you see right here, the market's joining in right here. That's why you have that volume expansion.
- [48:06]
A
You just got a spike at the bottom, which is usually capitulation. So you get the one spike.
- [48:11]
C
Yeah, and enlarge lower wick with that. And in this case it's happening right on support. I mean, you know, again, when these things happen by themselves, it's a good enough thing usually. But when it happens on support, it makes it that much more likely. Now, again, there are no guarantees in trading, blah, blah, blah. You know how this goes, right? But what you're doing as a trader is you're saying, okay, what are the probabilities like when certain things happen? And the more of those probabilities you can get together at the same point, then the more likely you are to be correct. And, and that's how you, that's how you should be trading and of course, with the proper risk management set in there. But Ethereum looking good here, I think, at the moment. So again, we just need to see follow through. Same thing with Bitcoin. Real quick, here's some charts. Last week I talked about one of the charts I had was ZK here.
- [48:59]
A
I said go long, never goes down.
- [49:02]
C
Did absolutely great here, rallied up. I think we're at five waves. Are just about five waves. It's popped up a little bit more here since I did this this morning. We're right around the R1 pivot here on the, the weekly R1 pivot. We've got 1, 2, 3, 4. It looks like five waves. So I'm looking, I'm watching for a rejection around here. You can see it hit our two targets and then went up higher here. But if we can get a rejection around here, I'm looking for a pullback to around this, about five cents to five and a half cent area. And I'm looking for that to be in three waves to come on down here. And if we can get that and start reversing, that should get us, you know, again with this being a 1 and a 2 to a 50 pullback here. Re heading out. But it depends, you know, we could still push up a little bit higher here, which would pull this closer toward that pivot. But ultimately the idea is we get a pullback down toward this pivot area and then that sets us up for the next move up. So that's what I'm watching for now. This was great. Trade worked out well. The other two didn't break out. You know, where I said we were looking for it to go long. This one did though. And like I said, really great return on there. So I think there's more work here once we can get this pullback. Other than that, I've got whiff here. Remember when, remember everything was whiff back.
- [50:17]
A
I love that you're looking at Meme coins, like in the. In the depths. So good.
- [50:22]
C
Well, you know, we'll see, right? We'll see. And this looks like we've got five waves up here. Looks like we've got five, you know, three waves back down. It looks like a flat correction. And then we've got this move up. And when I look at this, this appears to be a triangle, so, you know, an A, B. And then we get our C down here. Our initial support was right here at this same line that I drew way back in the day. And then this one right here, this support level here, working the support here. So if we were to continue to break down, you know, that would end up invalidating the count because I think we'd get down here to the S1 pivot and about. Almost. About 28 and a half cents and. And I'd still look again like. Like we were talking about the other ones. I'd look for a rally up, impulsive breakout and close above the daily. I'm sorry, daily Monthly pivot is here on the daily time frame to indicate that that low is in. We're going up. But right now, the way it sits, if we can rally from here. And again, daily candle impulsive breakout and close above this 55 cent level, we should be good to go locally. With this being a one and a two, that gives us a minimum expected wave three target at just about 85 cents. Wave five, just about 96 cents on that.
- [51:35]
A
I know we gotta go, but there's a bunch of people asking about Solana. Well, you can bring up whatever you got too, but I don't know if you have a Solana chart because I see a whole lot of requests for it and hey, we're men of the people.
- [51:44]
C
Yeah, yeah, I can pull up a Solana chart here real quick. This is Sui again, same idea. Looks like we've probably got five up and then kind of a flat correction here. 1, 2, 3, 4 and 5. If we continue to break down, we should. What it'll probably do is print a spring on this large range here, targeting this $1.67 area, maybe wicking down a bit further, but right now we're looking pretty decent. Again, Daily candle, impulsive breakout and close above 269 would signal that that low is likely in and we're going to break out higher here. So, you know, everything kind of looking the same way at the moment. And let me see, we got on Solana here. Give me a minute to pull up. Come on. There we go. There we go. Do it.
- [52:37]
A
They all look the same.
- [52:38]
C
Yeah, yeah, exactly. You know, so with Solana here, I've got this as a leading diagonal and then this is a pullback here. So I think we had an A B and then a, you know, a 1, 2, 3, 4 is a triangle 5. And so if that counts correct, we should definitely come back up here. Because a triangle, when you do it, per Elliott Wave rules, it is the last consolidation before the last push in the direction you're going. So, you know, directions down. The last one should get up there almost tweezer bottoms here. You know, again, volume looking good down there toward that low 50 pullback. S1 pivot here, monthly S1 pivot. So once again, you know, impulsive daily candle breakout and close above 1, basically 198 here should indicate that the low is in real quick. I'll get you guys a target here. Actually. Let me see. With that being a 1 and a 2 likely, that would give us a minimum expect wave 3 target about 400 and wave 5 about 461. Again, these are general targets that we look at. They can overextend. But right now, I mean, I don't think too many people complaining. You get any 200 and goes to 400, right?
- [53:58]
A
Yeah.
- [54:01]
C
So, yeah, basically, you know, everything's kind of looking the same. You know, we're on those monthly S1 pivot areas for the most part. So if that pullback holds and we're breaking out through those monthly pivots, there's little reason to think that we should be heading lower. There are no guarantees, of course, but generally speaking, the way that Price works with pivots, as you get that, you know, if you coming in sideways between the Pivot and the R1 or the S1, you drop the S1, find support there. If you then break out above the pivot, you. It runs up usually R4 or R5 pivot on that that you're looking at at least. So, you know, and. And it aligns with counts. But, you know, again, we can't guarantee that anything's going to happen. We're looking at saying, okay, based on structure. This is what we're looking at. We've got alignment with a few different ways. Whether you're looking at woff and Elliott wave and price action and volume and pivots. And so you got a confluence of factors, you know, even MAs, you know, all happening at that same area, which gives it a greater likelihood of being a low. But you still need the follow through to prove it. Right? So, yeah, that's that's where we're kind of sitting.
- [55:11]
A
All right, man, we made it all the way to 10 o', clock, so we gotta go, everybody. Give TX West Capital a follow. Of course. Check out everything he's got going on. And I really gotta run, man. Thank you very much. See you guys soon. Later.
- [55:24]
B
Let's dope.