View profile

Bitcoin Fear and Green Index Newsletter. Block 29

Bitcoin Fear and Green Index Newsletter. Block 29
By Bitcoin Fear And Greed Index • Issue #29 • View online
Welcome to this week’s issue of Bitcoin Fear and Green Index Newsletter. It is a community-driven effort, and we all hope to see this newsletter grow with quality insight and analytics from community contributors like yourself. Read till the end to learn how you can participate.

Current Bitcoin Fear and Greed Index
This week’s Technical Analysis
This past week, Bitcoin ebbed and flowed in price around the $40,000 mark. In today’s newsletter, I will detail Bitcoin’s macro momentum and the potentiality of a reversal into bullish territory.
Momentum Shifts:
When looking for signals that corroborate a potentially shifting trend, the Momentum indicator proves its worth.
The chart above shows Bitcoin’s price on the daily chart, extending back to January of 2021. More importantly, it illustrates the Momentum indicator. This indicator can be tricky to read if you don’t know exactly what you’re looking at, but once a decent level of comprehension is achieved, Momentum becomes a crucial tool if you’re looking to spot a reversal in a particular trend.
I’ll start first by explaining the different values shown on the chart. LL stands for lower lows, HH stands for higher highs, the two backgrounds on the Momentum indicator (blue and red) signify when the momentum is either in a positive trend (blue), or a negative trend (red). Most important is that when the momentum is in red, I’m referring to the drops as -ve highs and the lower drops as higher -ve highs. Essentially, you’re looking at irregular oscillations around a 0-level that separates positive from negative.
Now that the values are behind us, let’s get to the good stuff. The vertical blue lines on the chart indicate the different phases in Momentum:
The First Phase: Momentum was recording a series of lower highs on the +ve and higher highs on the -ve. While this didn’t mean that the price wouldn’t form higher highs, it indicated that the general trend was getting weaker and that a reversal was on the horizon. One way to identify an imminent reversal would be to spot an outlier in the oscillation. In this case, it would be the highest high recorded on the -ve. Notice how the -ve highs preceding it were significantly less pronounced, even with the second peak being higher than the first. The final high on the -ve signified that trend was undergoing a great deal of pressure to reverse.
A short-term trader who spotted this irregularity would’ve had the opportunity to exit the market at $59,000 before the May crash.
The Second Phase: Enter the May crash. The very first peak in this phase (-ve) ended up being the highest spike recorded, compared to both the +ve and -ve, since the start of 2021. Moreover, notice how the second high on the -ve was significantly lower than the first high, even though the price formed a lower low on the second -ve peak (~$28,700). That’s a bullish divergence; Another great indicator of a potential reversal. To put it in perspective, the first -ve high was approximately 2.6x larger than the second. The second -ve high was 2x larger than the third. When I go over the fourth phase, it’ll become much clearer why this irregularity in -ve spikes is so significant. Essentially, this signified that the bearish trend was coming to an end.
A trader who opened a long position with 10x leverage around the second -ve peak ($32,000) could have closed his position with a 1000% gain at $62,000 ($69,000 being the ATH).
The Third Phase: To clarify, I did not consider the +ve peaks in the first half of this phase worth noting as there was no oscillation around the 0-level between each peak (first four peaks). Even the first crossover into the -ve was so minuscule and short-lived, providing us with close to no value when assessing the momentum in this phase. Moving on to the lower highs on the +ve and higher highs on the -ve, one key indicator to take note of would be the irregularity in peaks. The lower high on the +ve (post -ve oscillation) was significantly less pronounced than the first. The second -ve high (into 4th phase) was 2.65x larger than the first. This is another example of how a significant irregularity in oscillation can be an indicator of a shifting trend.
A short-term trader who sold at any point around the second -ve peak would’ve saved himself approximately -40% of downward price action.
The Fourth Phase: Notice how the lower -ve highs in this phase are much closer in size than the lower -ve highs in the second phase. In hindsight, what does this tell us? It tells us that the bearish trend was not receiving any significant pushback or resistance, indicating that it would extend further than generally expected. That said, notice how the Momentum recently crossed below the 0-level. By tracking the successively decreasing highs on the -ve, it becomes clear that the bearish momentum is getting weaker even though the price was forming lower lows.
While this could be a positive sign looking forward, I’m not expecting an imminent reversal to the upside; on the contrary, I expect the upcoming -ve Momentum peak to coincide with a capitulation in price, just before a true reversal to the upside takes place.
With that said, have a bullish week, until we meet again.
TA review by @CryptoSultan21
Bitcoin Adoption News This Week
This Week In Bitcoin Adoption
  • Lugano, Switzerland will make Bitcoin legal tender
  • NonProfit ‘Bitcoin For Fairness’ announces travel to Zimbabwe
  • Shake Shack starts testing Bitcoin rewards with CashApp
  • Virginia Senate passes Bitcoin Bill
Lugano, Switzerland Will Make Bitcoin Legal Tender
The city of Lugano, Switzerland, will make bitcoin legal tender and allow citizens to pay for public service fees or taxes in bitcoin, city director Pietro Poretti co-announced in an event live-streamed alongside mayor Michele Foletti and CTO of Tether Paolo Ardoino. The city has already worked with over 200 merchants to propel the adoption of bitcoin and Lightning payments. “This is probably the most important thing of this project,” Ardoino said, referring to “Plan ₿,” a city initiative being sketched and worked in collaboration with Tether to attract wealth, smart minds, and opportunities. Tether’s stablecoin USDT will also become a legal tender in the city. Plan ₿ involves the creation of a physical venue in the heart of the city to function as a hub for Bitcoin and blockchain startups interested in making the city their new home, as well as the go-to place for networking events and hosting Bitcoin meetups and workshops. “El Salvador’s GDP increased by 10% and its tourism by 30% after declaring bitcoin a legal tender,” Ardoino said. “Imagine what we can do in a city at the center of Europe.” Poretti said the city would “roll the red carpet” for Bitcoin businesses and enthusiasts, welcoming visitors and prospect relocators with a business-friendly environment featuring minimized bureaucracy and the ideal conditions for a company to thrive. Plan ₿ also provisions the creation of two investment funds. The first will allocate up to $3.26 million to foster the adoption of bitcoin, USDT, and LVGA, the city’s stablecoin worth one-hundredth of a Swiss franc which will also be legal tender in Lugano. The second represents the formation of a pool of funds of up to $108.6 million for Bitcoin and blockchain startups that wish to relocate and set up their headquarters in the city as well as bring personnel to the Switzerland town.
Nonprofit ‘Bitcoin For Fairness’ Announces Travel to Zimbabwe
Nonprofit organization Bitcoin For Fairness (BFF), founded in January by Bitcoin educator and author Anita Posch with the intention of furthering Bitcoin awareness and education worldwide, shared a breakdown of its upcoming plans with Bitcoin Magazine. Posch’s advocacy work in 2022 will include traveling to the Southern African Development Community (SADC), Nigeria, and Latin America to work with educators and activists on the ground to shed light on and teach people about the unique opportunities enabled by Bitcoin. This month, she will travel to Zimbabwe’s capital Harare and to Zambia’s capital Lusaka to help bridge the gap between those with lesser opportunities and their rights to privacy and freedom. “Bitcoin might be our only tool to secure the human right to privacy and freedom of transaction,” Posch said in a statement sent to Bitcoin Magazine. “It’s a medium of liberation for billions of people and a defense mechanism for privacy in our ever more digital lives.” BFF will teach people how to spend, save, earn, and cash out their bitcoin, be it for long-term wealth or daily purchasing of goods, through workshops offered in grass-roots campaigns with entrepreneurs, developers, activists, and other Bitcoin enthusiasts. The organization said it will report from the ground through videos, podcasts, a newsletter, and its website. With their stated plan of action for Zimbabwe, Anita and the BFF plan to give a talk and a hands-on workshop at The Impact Hub in Harare; meet with Bitcoin users, communities, and human rights activists in the area; and visit St. Anne’s school, which reopened in 2020 after international bitcoin donations facilitated by Posch helped stage its revival. The organization will also visit Nhimbe Fresh in Marondera, a Sun Exchange solar power crowdfunding project that pays out earnings in BTC. During its stay in Zambia, BFF plans to hold a speech at the University of Zambia in Lusaka, speak at the Crypto Tamanga community event, meet with activists and Bitcoiners, and attend a few media appearances on radio and television.
Shake Shack Is Testing Bitcoin Rewards With CashApp
Shake Shack is providing bitcoin rewards to customers who utilize Cash Card, a debit card linked to Cash App accounts, to make purchases during a trial period, according to a report by The Wall Street Journal. As a cashback-style system, 15% of purchases will be paid back to Cash App users in bitcoin through mid-March. Shake Shack reportedly intends to test its ability to reach a younger audience as Block Inc, the parent company of Cash App, Spiral, and Square has a large customer base of millennials and Gen Z groups. “If we just started taking Bitcoin right now at our kiosk, it would have very low adoption,” Jay Livingston, chief marketing officer at Shake Shack, told the WSJ. “But through someone like Cash App, who’s been promoting it, you will get some more people that want it and that also want to learn.“ The utilization of Cash App as a marketing partner who has already thrust themselves into the Bitcoin ecosystem allows Shake Shack quick access to a growing user base of bitcoiners, without investing into the infrastructure or diluting any future attempts to adopt bitcoin. Livingston reiterated the need of partnering with those already successful in the space as a way to guarantee their own success.
Virginia Senate Passes Bill Allowing State Banks To Offer Bitcoin Services
Delegate Christopher T. Head, Senate member for the state of Virginia, introduced House Bill 263 in early January 2022 to allow traditional banks operating in the Commonwealth of Virginia to offer custodial services for bitcoin. “A bank may provide its customers with virtual currency custody services so long as the bank has 26 adequate protocols in place to effectively manage risks and comply with applicable laws,” the bill outlines. In order for banks to offer custodial services, they must go through a “methodical” process of self-assessment, which requires it to “carefully examine the risks involved in offering such services,” the bill provisions. The bill continues to explain the assessment criteria, stating that expectations of the banks include implementation of effective risk management, controls for the measurement and control of relevant risk associated with the banks holding custody of Bitcoin, confirmation of proper insurances in place, and the maintenance of a service provider oversight programs designed to curtail risks to service providers. The bill seeks to allow banking infrastructure to participate in either a fiduciary, or non-fiduciary capacity. Should a bank want to operate in a fiduciary manner: “Acting in a fiduciary capacity, the bank shall require customers to transfer their virtual currencies to the control of the bank by creating new private keys to be held by the bank.” With a total sweep of 39-0, the bill heads for Governor Glenn Youngkin’s desk to be signed into law.
The best and most beautiful things in the world cannot be seen or even touched - they must be felt with the heart.“ - Helen Keller on Bitcoin.
Stay Safe & Stack Sats!
Bitcoin Adoption News by @CuredSausage
This week’s issue is supported by Crypto Jobs List - the largest source of web3 jobs. There are hundreds of remote jobs that let your earn Bitcoin and other cryptocurrencies as a part of your marketingwriting or engineering job in this industry.
Participate in the next newsletter block!
We release this newsletter weekly and would love to feature the best contributors. Three sections are up for grabs:
  • This week’s chart, TA
  • This week’s regulation news
  • Major adoption news. Who’s accepting BTC/crypto?
To participate, submit your write up via this form. Best content will be featured and authors credited. ✌️
Did you enjoy this issue?
Bitcoin Fear And Greed Index

Join our community-driven newsletter, where we cover Technical Analysis, Adoption and Regulatory news. Read till the end to learn how you can participate!

In order to unsubscribe, click here.
If you were forwarded this newsletter and you like it, you can subscribe here.
Powered by Revue