War Without Bullets

• PENDLE (Fox):  Hit Newsletter long entry at 2.8281 and ran up to make a local high at 3.2905 for a 16.35% unleveraged move

• CRO (Fox): Hit Newsletter short entry at 0.08336 and ran down to make a local low at 0.07332 for a 12.04% unleveraged move

• BNB (Fox): Has nuked down to make a local low at 513.46 for a 15.41% unleveraged move from our Newsletter short entry at 606.97

• ETH (Fox): ETH has nuked down to make a local low at 1410.51 for a 29.47% unleveraged move from our Telegram short entry at 2000

• TAO (Fox): TAO has finally nuked way past the round 200 mark, which we have called to happen for many weeks

• HYPE (Fox): HYPE has finally nuked way past the round 10 mark, which we have called to happen for many weeks

@abullish - Equities

• ARM option calls for 4/4 resulted in a 42% gain

• CORZ option calls for 4/4 resulted in a 34.29% gain

• MDB option calls for 4/4 resulted in a 62.41% gain

• NVDA option puts for 4/4 resulted in a 64.75% gain

• SNOW option calls for 4/11 resulted in a 30.6% gain

• TTWO option calls for 4/11 resulted in a 108.76% gain

• AMD option calls for 4/11 resulted in a 10.28% gain

• CVNA option calls for 4/11 resulted in a 105.96% gain

• GLD option puts for 4/17 resulted in a 37% gain

• AAPL option calls for 4/11 resulted in an 11% gain

• GOOGL option calls for 4/11 resulted in a 14% gain

• COIN option calls for 4/11 resulted in a 15.45% gain

• AMZN option calls for 4/11 resulted in a 108% gain

• AVGO option calls for 4/17 resulted in a 112% gain

• DASH option calls for 4/17 resulted in a 48% gain

• NVDA option calls for 4/17 resulted in a 130.57% gain

Directional Positioning vs. Active Trading

In this episode, I'll teach you something very important: pay attention if you want to make money in the markets.

## Active Trading

Whenever you hear the word "trading", most people think about active trading—a style where you open and close trades at specific levels. When done properly, it looks something like this:

1. You determine your entry point, target, and invalidation. You set these levels based on a specific setup you know to be +EV*.

2. Then you wait for your levels to hit and execute accordingly. *+EV means you win over time—odds/profit in your favour.

Active Trading is difficult. It requires a lot of skill, experience, and, most importantly, emotional control. It is NOT for everyone, yet it's what most new "traders" try and then fail at.

Here's the kicker—Active Trading is not even as profitable as what we'll discuss next. The majority of active trades are noise. You make a small profit over time, but the big gains are in the following.

## Directional Positioning

Where Active Trading is focused on catching hyper-specific moves, directional positioning focuses instead on being on the right side of the market, using trader tools.

Let me explain. A passive investor might just buy an asset, hoping it goes up. An active trader doesn't care where the market goes and only tries to catch a specific move. However, a directional trader gauges the trend in which the market is headed and then positions himself in line with this.

Many people in crypto inadvertently fall into this camp by buying and selling based on whether they think it's a bull or bear market, which I call a level above the passive investor. But when this is done with intention, massive amounts of money can be made.

This will still require some skills, but won't require you to be a top 0.1% analyst. Here's the play:

### Part 1: Fundamentals

Get a basic macro and fundamental understanding, and contextualize that in the markets. Is global liquidity rising/falling? Are rates high/low? What factors matter for markets right now? Finally, how does this reflect on price? Let's use a current example.

1. Global liquidity is kind of flat but not really headed down. If it's not heading down, it's neutral/bullish.

2. Rates are high and might stay that way for a little while, but cuts will come eventually. So, while hikes originally were bearish, they'll come down from here, meaning they're more bullish.

3. Trump's tariffs pushed uncertainty and caused a market dump. However, the worst of this plan seems over, so while it was short-term bearish, it doesn't seem to have longer bearish legs.

Then, we contextualize that with the markets. Bitcoin is still in a macro uptrend (higher highs and higher lows). It's down 30% from its highs and has a lot of support below it. So, Bitcoin has held a bullish structure even throughout a bearish macro, which means that once the macro turns bullish again, Bitcoin will likely continue.

When you think about fundamentals, just go with "What makes sense?" Again, categorizing things correctly will take some skill and learning, but it's not too complicated once you get it.

### Part 2: Technicals

The second part to this equation is the technicals, AKA your charts. Where a macro investor or trader might take these ideas and just go pressing buttons, they're likely to fuck it up and lose their money. Because when we're trading, the setup is still important.

Let's use the following example on Solana.

It's the end of July of '24, and I believe Solana is returning to its ATH. Eventually, it will do so, but as of this moment, buying would be foolish.

That is because while the fundamentals align for a new ATH on Solana, the chart is not yet ready. We see SOL trading into resistance, sweeping liquidity, and putting in the start of a double top. Our target would be around the all-time high, and if it were to break major support, it would likely be bearish, so we put our invalidation below.

This would give us a one risk-to-reward and quite frankly, it's shit. 

While the fundamental idea is correct, the execution is terrible. Using basic technical analysis, we can identify the horrendous longs we were about to take and avoid them like the plague.

Instead, we'd wait for a proper entry, backed by our TA, to take our position. This would mean we'd buy around the support of its range. Our invalidation wouldn't need to change much, nor would our target. As a result, Solana going to ATH would make us 6R. If we oversimplify it, it would mean it's 6x more profitable to get in at support vs. that resistance.

Now the point I'm trying to make is this:

Use your noggin to determine the fundamental direction of price, then confirm it using technicals to obtain entries.

Fundamentals have been bearish, but are likely to flip soon (bullish).
+
Chart in macro uptrend (bullish).
=
Let’s look for decent entries on assets aligned for both of these.

By being patient and not relying solely on macro speculation or technical analysis, we can combine the two to trade much more effectively.

So, if your chart and the macro say that prices will likely go up, you look to find long entries. For example, if things are bearish, you might buy the dip on spot or short pumps.

Your baseline positioning (spot) should align with the market's overall direction. You don't need to get perfect entries or exits. But we do want to try to optimize a little. Once you strike that balance, it's like striking gold.

P.S. This shit also helps with confidence on sizing. I would never have gone as heavy on August 5th if I didn’t have the fundamental reasoning to follow my strong chart.

Disclaimer  

Wizard of Soho LLC and Weekly Wizdom publish financial information based on research and opinion. We are not investment advisors, and we do not provide personalized, individualized, or tailored investment advice, nor do we provide legal advice or information. The publisher does not guarantee the accuracy of the information provided on this page. All statements and expressions present are based on the author's or paid advertiser's opinion and research. Directly or indirectly, no opinion is an offer or solicitation to buy or sell the securities or financial instruments mentioned.

As news is ever-changing, the opinions included should not be taken as specific advice on the merits of any investment decision. Investors should pursue their investigation and review of publicly available information to make decisions regarding the prospects of any company discussed. Any projections, market outlooks, or estimates herein are forward-looking and inherently unreliable. They are based on assumptions and should not be construed to be indicative of actual events that will occur.

Contrarily, other events that were not considered may occur and significantly affect the returns or performance of the securities discussed herein. The information provided is based on matters as they exist on the date of preparation and do not consider future dates. As a result, the publisher undertakes no obligation to correct, update, or revise the material in this document or provide any additional information. The publisher, its affiliates, and clients may currently or foreseeably have long or short positions in the securities of the companies mentioned herein. They may, therefore, profit from fluctuations in the trading price of the securities. There is, however, no guarantee that such persons will maintain these positions. Unauthorized reproduction of this newsletter or its contents by photocopy, facsimile, or any other means is illegal and punishable.

Neither the publisher nor its affiliates accept any liability for any direct or consequential loss arising from any use of the information contained herein. By using the website or any affiliated social media account, you consent and agree to this disclaimer and our terms of use.