The Market Hides Himself

The best victory is to win without fighting (Sun Tzu).

For many years, an ancient book has been very much in vogue among executives and leaders, due to the teachings it brings to the management and direction of groups. It is ‘The Art of War by Sun Tzu). Sun Tzu was a Chinese general, philosopher, and military strategist who lived around 426 BC.

His culminating work is this treatise on military strategies and tactics, which in modern times has been used as a management method and business strategy.

In one of his quotes, the author describes how the best victory can be: the one that is achieved without any combat. Because you have to be clear that whenever you enter a conflict, you will have casualties.

No… you have not made the wrong profile… here we are still talking about financial markets and crypto assets, and I assure you that these principles have a direct application as I am going to show you

The art of silence and camouflage

Following these principles I have mentioned, we have different trader profiles in the market. Some like to enter in the heat of the battle… but deep down, in the depths of the market, others stealthily take decisions and positions at the right time, the one in which nobody expects this to happen. Thus, there is a victory without a battle

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This early morning there has been one of these stealthy movements, an important movement in which we have seen how the price of bitcoin reached 21,000 USD, and also, a movement theoretically executed by strong hands, it seems. These are the moments when these traders decide to trade, and these are the moments we should look for.

When we invest for the long term (holdl), the search for the best entry price becomes a priority.

We continue with the scenario of weakness

Although this situation can be taken advantage of, we must be aware of the context from a technical point of view, and that is that we continue to see a weak and weak market, awaiting events. It seems that there is nothing to disturb the sluggishness we are seeing.

  • The increasingly insistent story of the preparation of a stable coins regulation by the US administration.
  • The closure of the final MiCA text in Europe.
  • The SEC’s new no to MicroStrategy’s ETF
  • Michael Saylor’s company’s purchase of Bitcoin at minimums….

And so we could go on with a host of significant events that at another time would have moved the market in a major way and now go unnoticed. We as market specialists must accept this fact, but we must also keep in mind that these events are occurring, and that they represent an advance and an improvement for the entire ecosystem

We must be clearly aware that the cryptoasset industry is moving and advancing, despite the bearish market situation

One of our tasks will be to evaluate to what extent this potential increase in value produced by the macro situation is not correctly transferred to prices at the moment, because theory tells us that it will do so sooner or later, and therefore, we have here an interesting window of opportunity in the medium and long term.

Market sentiment

Leaving aside other types of methodologies, equally or more valid, to examine market sentiment, the derivatives market positioning always gives us useful information in this sense.

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And in this case, we can see how the uncertainty and the bearish context continues at maximums with a PutCall ratio spread between bitcoin and Ethereum of more than 30bp, something unheard of.

Replica in ETH

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This context that we have seen in bitcoin, we see it reproduced exactly in Ethereum, where we can appreciate a movement of the same characteristics.

Think of your strategy

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A big component of our trading must be reflection. The decisions you make should never be hasty and have to be well founded, so now is surely a good time to design how we are going to work in the market in the coming months by designing scenarios in both directions

Design scenarios with relevant operating levels, both upward and downward, have a predetermined plan, thinking not to enter into a battle with the market

Diagnosis

Are we facing a market floor? The truth is that we do not have the certainty, but we must have the ability to objectively analyze the facts, without getting carried away either by panic or euphoria, which are our greatest enemies.

The euphoria of believing that we will quickly see new highs will lead us to a dangerous precipitation, and the panic produced by the story that all cryptoassets will go to zero will make us lose what could be a historic market opportunity, so in these moments, it is good to remember phrases like this one

Esto es lo único que importa en la buena propaganda. Se trata de crear un eslogan que no pueda recibir ninguna oposición, bien al contrario, que todo el mundo esté a favor. (Noam Chomsky)

DYOR

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