Espresso 2.0 : The Ink is Still Wet

by Ben Lilly

The Ink is Still Wet

The clown picked a green one.
We’d been going sideways for almost a month. And now here I am at a birthday party.
Classic timing I thought as I swiped my phone’s face and instinctually tapped the app in the bottom right-hand corner.
I already knew what I’d see… Bitcoin pumping.
A few meters away my friend was unable to contain his excitement. Meanwhile, the clown went ahead with what was probably his 87th routine of the day.
As the green balloon began to resemble a baseball bat I was instantly placed in a separate reality. One of the green towering candles.
Sure, my friend could have just told me to check bitcoin… But no, he chose a more poetic approach.
I hope the Encore comes soon…
This story from several years ago reminds me of what yesterday brought us, which is a signal that pops up when you’re nowhere near a computer. What’s more, it’s a signal that demands your attention.
(that story also hints at why Jarvis does 95% of my trading now… You’re rarely at the helm when action strikes)

The Short and the Long

Jerome Powell isn’t the only one that can pump markets. Tether got its shipment of the proverbial ink cartridge and minted 200 million USDT. Before the ink dried the market was already reacting.
The fact is, this new print sets the tone in the near. Tether is literally driving the markets. But what you need to know is 120 million of it is headed to another exchange where altcoins tend to get some love.
That means you can expect to see activity on ETH and altcoins in the coming days. If it unfolds you can send thank you letters to wherever Tether’s office is.

As for the long-term, nothing has really changed. Long-term here is more like one to two months…
Risk levels are elevated, whales are shuffling, and even the on-chain OG analyst, Willy Woo added some thoughts on the market. For those of you who don’t know Willy, he’s one of those guys that can silence a room full of crypto on-chain researchers by walking in the room.
He recently sent a tweet out on a metric called SOPR. It stands for Spent Output Profit Ratio. He describes it as a lie-proof survey of investors to determine their profit or loss.

As for me, I like to call it Selling Out Pre-Retail.
It’s a metric that is helpful on wider timeframes to determine when the market has cooled down. Or said another way, it helps traders know when we’re ready for another leg higher in a bull market.
Here’s the eSOPR below. The “e” portion of the metric is just an updated version of it. Glassnode added “entities” to the measure because they tagged some wallets that might belong to the same person.




The orange line in the chart below is eSOPR. The white line is the bitcoin price. The horizontal line is eSOPR’s value of 1. As you can see eSOPR tends to hover around this white horizontal line.
When the orange line drops in value to touch the white line Willy Woo refers to it as a reset. Meaning the market is ready to push higher.
We agree with his point of view where the market looks ready for a pull back to this white line… Or a reset.
Risk levels are off the charts, Greed levels are at multi-year highs, Wall Street is seemingly going all-in on bitcoin and the holidays are coming next week.
For those of you that may not know, lower levels of liquidity tend to happen around the holidays. We expect nothing different this time around. If it happens and we happened to witness a bitcoin pull back, we’ll bring back this chart.
When it touches the white line it’ll be the reset we are waiting for.


Your pulse on crypto,
B. Lilly

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