Not much of an analysis but rather a meditation about the question: Is there any reason to buy Iota now besides an acute fomo attack?
Pros:
- Well, it was much higher some years ago and altcoins are again exploding left and right.
- It's a serious project with a real usecase = it can produce convincing news and tweets to lure in the next generation of bagholders.
Cons:
- Iota's movements since 2017 could be described as: If Bitcoin rises, Iota falls. If Bitcoin falls, Iota falls. It got better the last months, but still. Bitcoin is at 50k, which in the community is rather a target than a barrier. It's unclear what will happen in times of Elon Musk and Grayscale. From crash to moon everything is on table, with a slight bias towards a mild crash/stronger correction. History tends to imitate itself.
- Many of the larger altcoins already poppped. We could see some serious market correction soon. The stupid money for this run already went into Doge. Not many people left who'll sell their farm to play the "buy high to get rich quick, get disappointed, hodl to get rich slow, get disappointed again, sell low" game.
- Iota was trading below 10 cents just a few months ago. The last days it went from strong uptrend into euphoria stage. Parabolic moves almost always lead into a crash, extreme greed often turns into extreme fear.
- The most likely reason that it popped is because it's that time of the year. Everything is popping. That chrysalis stuff... come on, it's crypto. Probably impressive technology but the technology doesn't have too much to do with the price, exept for being the creator of news and tweets that can create hype when the market is in the mood for another hype cycle.
- Fundamentally, Iota is different. It does not need to have a value to secure its network, and it's about transfer and storage of data, not of value. The most likely long term future for this coin is that of being a very stable boring "currency" used by fridges, teslas and toasters, not by amateur swingtraders. Not a good situation once summer ends and we go into altcoin winter.
- And short term there are some triangles on the chart that don't look healthy. It tried to break out, next logical target probably around $1.55, but failed and now is forming some pretty bearish patterns.
- If you stand on the top of the chart and look down, you'll have a hard time to see anything except a big void to fall into. I can't even remember how it is when a candle touches the 1d ema 200.
- And if you are into these things: macd and rsi on the higher timeframes are saying "we need to talk".
Conclusion:
It could climb even further, but convential wisdom points downwards, possibly into the $0.90s or even $0.70s. There is not much of a solid market structure that could provide confidence to the not so smart money that bought into this currency above $0.49.
It wouldn't be too much of a surprise if it makes a jump, but at the moment I don't see any good reason to buy except for the fear of missing out. And we don't do that anymore.
It looks more like a sell opportunity, but with Bitcoin in that important make or break area ... why? There is always another trade.
Pros:
- Well, it was much higher some years ago and altcoins are again exploding left and right.
- It's a serious project with a real usecase = it can produce convincing news and tweets to lure in the next generation of bagholders.
Cons:
- Iota's movements since 2017 could be described as: If Bitcoin rises, Iota falls. If Bitcoin falls, Iota falls. It got better the last months, but still. Bitcoin is at 50k, which in the community is rather a target than a barrier. It's unclear what will happen in times of Elon Musk and Grayscale. From crash to moon everything is on table, with a slight bias towards a mild crash/stronger correction. History tends to imitate itself.
- Many of the larger altcoins already poppped. We could see some serious market correction soon. The stupid money for this run already went into Doge. Not many people left who'll sell their farm to play the "buy high to get rich quick, get disappointed, hodl to get rich slow, get disappointed again, sell low" game.
- Iota was trading below 10 cents just a few months ago. The last days it went from strong uptrend into euphoria stage. Parabolic moves almost always lead into a crash, extreme greed often turns into extreme fear.
- The most likely reason that it popped is because it's that time of the year. Everything is popping. That chrysalis stuff... come on, it's crypto. Probably impressive technology but the technology doesn't have too much to do with the price, exept for being the creator of news and tweets that can create hype when the market is in the mood for another hype cycle.
- Fundamentally, Iota is different. It does not need to have a value to secure its network, and it's about transfer and storage of data, not of value. The most likely long term future for this coin is that of being a very stable boring "currency" used by fridges, teslas and toasters, not by amateur swingtraders. Not a good situation once summer ends and we go into altcoin winter.
- And short term there are some triangles on the chart that don't look healthy. It tried to break out, next logical target probably around $1.55, but failed and now is forming some pretty bearish patterns.
- If you stand on the top of the chart and look down, you'll have a hard time to see anything except a big void to fall into. I can't even remember how it is when a candle touches the 1d ema 200.
- And if you are into these things: macd and rsi on the higher timeframes are saying "we need to talk".
Conclusion:
It could climb even further, but convential wisdom points downwards, possibly into the $0.90s or even $0.70s. There is not much of a solid market structure that could provide confidence to the not so smart money that bought into this currency above $0.49.
It wouldn't be too much of a surprise if it makes a jump, but at the moment I don't see any good reason to buy except for the fear of missing out. And we don't do that anymore.
It looks more like a sell opportunity, but with Bitcoin in that important make or break area ... why? There is always another trade.
Now the task is to not fomo into trying to swing trade the pullbacks. Some people can do it. Most can't. The volatility and appearance of predictability is tempting but you need to be fast and you only can be fast if you really know what you are doing.
Wisest decision for low to intermediate skilled traders like myself is to just smoke some herbs, lean back and wait what Bitcoin is doing. We trade the higher timeframes. Below 1 hour is a minefield for the less experienced. If Bitcoin can move over 51.2k and establish a calmer structure that says "wait, there is more", we can talk again about Iota.