Narratives of the week : October 6
SOL strength, AVAX and Stars Arena, CANTO comeback
Welcome to this weekly recap, I am Viktor and you can find me here on Twitter and here on Telegram. Enjoy your reading !
$BTC and the market overall :
BTC has been very slowly going up (on average) during the last 30 days. The current price is $27800 and the $BTC chart looks good on low timeframes. We’ve seen a massive spot buy of BTC this week that generated an almost +1K move on the price, and squeeze some shorts. That move up ended up being retraced (as most moves in recent times), but the overall trend looks bullish.
I don’t have any strong opinion on the market moves on low timeframes, though. I like to follow DonAlt for short timeframes on BTC, since he’s covering it almost everyday, in a very agnostic and profit-driven way. He has almost been profitable on every of his trades this year, and he is currently long $BTC.
I think we might have a last dump in Q4, that could go below $24k, maybe to $22k (but we probably won’t see BTC price under $20k), and this will be the last dip to buy before we go to $35K territories and hopefully up only.
As for ETH, it is slightly down this week : the current price is $1640 while ETHBTC keeps trending down steadily (0.059 now). The ETH futures ETF launch of VanEck has been very disappointing in terms of volumes, with something like a few millions in volume.
The ETH underperformance is not a big concern for me (even if I hold way more ETH than BTC) because I think that ETH will outperform BTC anyway in the bull run, and I also think that BTC dominance has to go up to ignite the start of the next bull run. In the end of 2020, BTC and BTC.D had a run together, and that was the beginning of the bull run (even if there was DeFi summer before that). I expect this situation to happen again. In short, altcoins have to underperform $BTC while $BTC goes up, for altcoins to be able to outperform BTC.
Read this ETH long-term thesis if you need some hopium :
Solana short squeeze :
One of the strongest major altcoins this week is $SOL, it is up +16%. The reason for the outperformance is that there has been 2 clear short squeezes : people probably overestimated the potential bearish impact of FTX selling its bag of liquid $SOL tokens. We don’t have very transparent information about the selling but a lot of traders probably were trapped into their SOL short while the market went up, so the short squeeze happened. Anyway, $SOL proved to be very strong this year, it basically outperformed $BTC massively during every market pump. $SOL is my biggest bag behind ETH and BTC, and I remain confident that SOL will outperform ETH in the bull (read my article about the narratives for the next bull run).
$AVAX and Stars Arena :
Another alt L1 of 2021 is having a very good week : $AVAX is up 2-digit gains this week, and is among the best-performers, this is something we haven’t seen in a long time. AVAX has been bleeding non stop versus BTC since the echo bubble top in February, and it’s the type of coin that went from being a blue-chip in 2021 to being a coin that you’re not so sure about holding anymore. But the pump of this week doesn’t come out of nowhere : the catalyst is the new “friendtech of Avax”, which is called Stars Arena. Stars Arena is probably the Friendtech competitor with the biggest success yet, since it has growing TVL of more than $1.6M right now. The most likely outcome though is that it will top soon and fade slowly into irrelevance, but that’s my fadooor spirit talking : being very early on forks can be a rewarding strategy, so don’t hesitate to try new things in crypto as soon as they get out, like this platform.
CANTO in the spotlight again :
Another alt L1 is showing high double-digit gains this week : $CANTO is up +63%. CANTO is a Cosmos EVM-compatible chain that has been a bit of a mystery to me. When you look at its chart, you see that it’s basically a never-ending succession of pump-and-dump cycles, with significant gains when it goes up. For example, CANTO was among the best performers of the 2023 echo bubble, with more than 10X gains. It’s currently up 3X from its bottom one month ago, and I wouldn’t be surprised to see this pump continue. One of the catalyst could be the Polygon announcement that Canto would be migrating to a zk-L2 on Ethereum powered by the Polygon CDK, as it plans to build a blockchain dedicated to RWA. It looks like. a lot of buzzwords, but it could be a great idea. Maybe we can now consider that CANTO is part of the whole RWA narrative ?
Other altcoin news :
As I’ve mentioned in previous weekly recaps, Chainlink hosted its Smartcon conference this week. $LINK has been performing very well (from bottom to top of its more than one year long range) in the weeks prior to this event. Did people sell the news ? Well, a bit, but not that much, there has been a -10% dump from the top, which is not that significant, but you could have made rather easy profits off this move.
$WLD ended up dumping from its $1.9 top. I wanted it to go above $2 so that I could add to my short, but this never happened. WLD is currently right above $1.5, and I am close to breakeven on my trade but I will probably add again to the short if it bounces significantly from $1.5. I think we will see $1 on WLD before we’ll see $2.
$CHSB, the token of the Swissborg CEX, is up more than 30% this week. The catalyst for this move is the migration from $CHSB to a new $BORG token, that is set to start on October 17. After ICE → WAGMI, and MC → BEAM, we are seeing that token migration tend to be a very bullish catalyst.
Here are other midcaps that have been performing well this week : $SRM (+38%), $VRA (+35%), $OGN (+25%), $LQTY (+24%). In the cartel pump lands, $LEVER seems to have topped this week, after a +150% move in 3 weeks.
$ATOR managed to get very close to its ATH price this week again. This coin is one of the coin that has been going up steadily since its launch, without interruption. Will it run once it is in price discovery again ? A similar coin is $KAS, but this one is way larger and the upside seems limited, but it’s also very close to its ATH price.
$HERA is another coin that reached a new all-time high this week : $HERA is a DEX aggregator that was initially launched on Metis but it has been expanding into a multichain aggregator, and it is supposed to be “AI-powered” (good marketing to benefit from the AI trend). $HERA will become an omni-chain token that will use the LayerZero technology. The “fake Su Zhu” wallet (0x51eb4521ac4c354447a699ffcfb827dd941da04b) has been scaling into $HERA and currently owns $200K $HERA.
Friendtech has finally seen a (small) dump in its TVL. Besides a normal loss of impetus after 2 months, the first reason for this is that some users got sim-swapped and their funds have been drained, which raises concerns about the security of funds on FT. CL207 wrote a great (bullish) article about Friendtech by the way, you can read it here.
Su Zhu, the 3AC co-founder, has been arrested in Singapore one week ago. He is also the co-founder of OPNX, a CEX exchange, with Kyle Davies, and OPNX has a native token $OX. $OX was among the best performers during the “onchain summer” frenzy, but it has dumped a lot from its ATH, and took an even bigger hit after the Su Zhu arrest news. It is currently at $35M market cap, $90M FDV, down almost -90% from ATH. At the current price, I think the risk-reward is okay for buying $OX, since the downside looks limited, but it’s still a dangerous play.
Between all the onchain summer winners, $RLB is the one that resisted the best from the dump. It pumped +25% this week and is currently standing around $0.15 after a solid rebound from $0.10. Rollbit is a cash generating machine, and this week they announced that buy and burns are now verifiable on-chain.
Some (mostly “shitcoin”) tickers I’ve seen a few times on Twitter this week : $KREST, $FTX, $KIZUNA, $OPOS (Solana shitcoin). Most of them will probably go to zero but if you like shitcoining, that list could be useful.
Some good tweets / threads :
Tips for maximizing easy trading conditions :
DonAlt view on BTC :
Stars aligning for a strong Q4 :
Crypto-Equities correlation is now noise :
SOL bullish tweet :
Uptober ?
The RWA thesis :
Reasons to be bullish for the coming quarter :
Andrew Kang is bullish :
Thank you for reading this article,
Cheers,
Viktor.
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