Today’s Narrative - 📈Cautiously Bullish📈

Macros

• Pre-FOMC jitters are normal as markets await today's rate decision, with most attention on the dot plot, which outlines each Fed member's expectations for rate changes in 2025. This will reveal shifts in sentiment about the rate cut cycle.

• Inflation concerns are rising, with recent months showing increases that could influence today’s FOMC outcome and Powell’s post-meeting commentary.

• A 25bps rate cut is highly expected, but the bigger focus will be on how bullish or bearish the dot plot has become compared to last quarter.

• De-risking behavior is evident, with markets cooling off after Bitcoin’s recent highs, indicating a cautious approach ahead of the FOMC meeting.

Crpytos

• Bitcoin's dominance is growing, hitting a new ATH of $108K yesterday but pulling back slightly as its dominance rises to 58%, putting pressure on altcoins.

• Altcoins are underperforming, but this is likely a breather before their next rally, especially as the market regains strength.

• Institutional demand remains robust, with BlackRock IBIT reporting a $733.6M Bitcoin inflow on December 17th, the largest since early December.

• Michael Saylor's buys have fueled demand, but questions arise about market dynamics once his purchases slow. His firm appears well-funded for a few more weeks of buying.

• Tether’s Q4 purchase plans could impact demand, introducing another potential catalyst for Bitcoin's price action.

• Binance Alpha shows promise, with its new listing platform creating excitement by pooling projects for future token launches.

• Ethena's innovation in stablecoins could inspire yield-sharing, enhancing the utility and competitiveness of stablecoins in the market.

• Pudgy Penguins' $PENGU token faced poor sentiment after its launch, with ~60% of airdrop addresses already claimed causing their tokens and valuations to decline.

• Stacks' sBTC launch on the mainnet is significant, allowing deposits up to 1,000 BTC, with withdrawals planned for Q1 2025.

• Omni Network successfully launched its mainnet, showcasing progress in interoperability and blockchain infrastructure.

• Saga's Mainnet 2.0 offers game-changing features, including aggregated liquidity across chains and gasless DeFi, which could be pivotal for the ecosystem.

• Bigtime Studios launched a $150M Open Loot Fund, supporting Web3 gaming growth on its platform.

• Simon's Cat Token teased an airdrop, signaling potential opportunities for participants.

Our Stance

We have the FOMC today—hopefully, any leverage traders have de-risked already because FOMC meetings and Powell’s speeches are notorious for shaking up the market. Beyond the immediate rate decision, keep an eye on BTC dominance (BTC.D). It’s at a crucial resistance level, and how it moves from here will shape the narrative for the next few weeks. If BTC.D remains below this level, alt season can continue. But if it breaks above, brace yourself—things could get rough for alts.

For now, prepare for a small dip, which could be a golden opportunity to accumulate before the next rally into 2025. Remember, the holiday season is here, and that means volume is dropping off. Fewer traders can amplify market volatility, so this is a critical time to avoid overexposure and manage your risk. The last thing you want is to lose the gains you’ve worked so hard for over the past few weeks right before the new year.

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📈Bullish📈 💰Alpha💰

Altcoin Potentials

Let’s touch on a few altcoins with potential upside. While Bitcoin continues to do its thing, there’s plenty happening in the altcoin space that’s worth keeping an eye on.

$ENA

• Has a Strong US alignment narrative, which is bolstered by its recent partnership with BlackRock. See the announcement here.

• A major criticism of ENA has been resolved, as explained in this detailed thread. The market is signaling ENA as a strong coin worth holding, there’s also a potential Upbit listing soon which you don’t want to miss.

$XRP

• Ripple's RLUSD just launched, marking a big step forward in utility, albeit only on less popular exchanges for now. Details here.

• Institutional adoption looks likely, with RLUSD potentially used by family offices and funds in the U.S. More insights here.

$LTC

• ETF approval momentum could include LTC, with ETF expert Eric Balchunas predicting its approval alongside HBAR. See his comment here.

• Altcoin ETFs might spark hype, as they challenge the market to embrace risk and push altcoin narratives further. LTC could ride this wave, especially post-confirmation.

$SOL

• Short-term price action for SOL looks rough, but zooming out reveals strength at sizable levels. SOL is nearing $200, $POPCAT is around $1, and $RAY is holding $5—all must-hold levels for the ecosystem.

• Spot risk/reward looks favorable, especially near $200 for SOL heading into Q1 2024. Longer-term positions here could pay off significantly as the ecosystem stabilizes.

• Rotation back to SOL could be brewing, as Hyperliquid approaches saturation at a $10B market cap. Watch for a potential rebound in SOL as capital flows stabilize.

$ETH

• Q1 2024 looks bullish for ETH, as its consolidation below $4K seems healthy. With catalysts like the Pectra Upgrade and ETHBTC outperformance, ETH could lead majors by March.

$PENDLE

• Pendle is quietly grinding up, with $AAVE pools recently going live on the platform. Details here.

• Intrinsic to DeFi, Pendle is set to benefit if ETH and DeFi outperform in Q1 2024. Despite its importance, it remains under the radar, making it a strong contender for alt strength in the coming months.

$AR

• Arweave's upcoming $AO launch is a clear catalyst, making it worth watching closely. Anything near the $20 range could be a great entry, with a potential exit around $30.

$GOAT

• Price action looks toxic, likely due to a large holder exiting slowly. However, rumors of a Netflix show tied to GOAT could be a game-changer. Read more here.

Let Bitcoin dominate for now while keeping tabs on these projects’ catalysts. Quick scalps or dips can be rewarding.

📈Bullish📈

AI Agents and Bitcoin Make History

In a first-of-its-kind event, AI agents have successfully executed a Bitcoin transaction between themselves—a groundbreaking development that highlights the future potential of artificial intelligence and blockchain. This historic transaction isn’t just a technical milestone; it’s a glimpse into a future where AI can autonomously interact, trade, and manage digital assets.

Why It Matters

The AI-to-AI transaction represents a massive leap for both the crypto and AI sectors:

• Proof of Concept: AI agents can autonomously manage a wallet and complete Bitcoin transactions, something that was only theoretical until now.

• Automation of Complex Systems: This opens the door for AI agents to manage funds, execute trades, and optimize decentralized finance (DeFi) strategies without human involvement.

• Scalability for Crypto Adoption: By integrating AI, the crypto space can move toward seamless automation, removing barriers for users and simplifying the process of asset management.

The Bigger Picture

For Bitcoin, this milestone demonstrates its adaptability as an infrastructure for cutting-edge use cases, not just as a store of value. For the AI sector, this experiment proves that autonomous agents are no longer bound to theoretical ideas—they can operate in real-world scenarios, specifically in financial systems.

What Comes Next?

While this is just the beginning, it sets up a major narrative: the convergence of AI and crypto is inevitable. Imagine AI agents running DeFi protocols, automating trading strategies, or even managing large funds. This tech could unlock:

• Efficiency: Instant, error-free transactions.

• Accessibility: Making complex financial tools available to anyone.

• Autonomy: AI-driven ecosystems that don’t need constant human oversight.

For now, this event is a signal to pay attention. The intersection of AI and crypto is heating up, and the projects building in this space—whether it’s infrastructure, DeFi, or automated trading—are likely to dominate narratives heading into 2024.

AI agents are making history, and this is just the start.

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