Is the bottom in?

I feel a bit optimistic about the markets this week, at least in Ethereum land. Two days ago we broke out of a two week downward range, and this morning we broke one going back to mid-may, starting with the peak at $4300. And we’re above the 200-day moving average. We’ve got several resistance levels up from here, I’m looking for a close above $2900 before I feel really confident. Right now my Perp.Fi position is sitting around 4x with a liquidation price at $1580. I’ll probably maintain it here, using the negative funding to compound my position weekly, perhaps lower my leverage factor a bit. I think it’s safe to keep it here until new ATHs; I’ve still got enough cash in my bags to defend this position if we have another drawdown. I had enough stress dealing with liquidation risk last week. I’ll sit here.

ETHUSD chart

I still think we could range from here for the next month or so. We’ll see if EIP-1556 gets deployed on time, and what happens with the BTC price. Bitcoin has been somewhat anemic here, but on-chain data is really strong and there’s a lot of accumulation going on here. I’ve got two positions open here, 2x longs with liquidation prices at $22k and 18k. I’ll manage these for cash flow while compounding and looking for opportunities on LedgerX’s options or futures markets.

I’m not doing anything else in the market right now. I’ve been thinking about taking a position in PERP, but my main focus is income generation rather than speculation. I just moved $6,000 in USDC to my checking account, which will take care of my expenses through July at least. The historical funding rates on Perp.Fi are only at 75% my previous salary at my current nominal position value, so I’m either going to need the market to pick up 25%, or I’ll need to increase my size. I’ve got a couple ways I can do that. I can liquidate spot positions, harvesting tax losses while I’m at it, and convert that to Perp margin, increasing our decreasing the amount of leverage that I have in my position. A safer, but slower way to build this position is to remove the funding payments, which decrease my leverage and liquidation price, out of my margin, and use them to add additional leverage into my position, maintaining it over time.

I estimate that I have until the end of September to make this work. That’s when student loan payments come due, and I’ll need to make a decision on whether to take a regular job. In the meantime, I’ve got several projects I’m working on, hopefully one of them will work out and allow me to maintain my reFIREment indefinitely.

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