My Favorite Low Cap - Smartlands (SLT)
Updated
A lot of people don't know this (there's a huge information gap in the crypto space), but XLM is also a platform, in addition to being one of the fastest cryptocurrencies out there. SLT is one of the coins on the Stellar network. It's a platform for STO's (security token offerings) - a use case that may end up being quite attractive for everyday investors. Tokenizing assets may provide a pretty powerful avenue for financial inclusion, since it allows people to tokenize real property, and things one might not have ever imagined being "shared." It's a somewhat utopian vision (and I'm harkening back to my post on crypto analysis as science fiction), but one can imagine an economy where everyone participates in the trust of a global network of shared value. Of course, the wealth disparity is a growing problem, but this is a small step closer to some financial accessibility. That's Stellar's vision, so it's not surprising that Smartlands decided to build on XLM. It's time for an update on SLT, since we've finally gotten a little more price history on this one.
As some of you may have noticed, low cap altcoins have gotten the worst treatment since this past Spring. This is why a lot of "seasoned" crypto traders will hold mostly Bitcoin and Ethereum during bear markets and then diversify out as a floor becomes more obvious. We're seeing that happen right now. It may not be fairly obvious yet, but cryptocurrencies are starting to react positively towards news, and several are making serious attempts to break out. Just look at VET, NEO, ONT, TRX, and others on the China news. Look at XLM from yesterday's coin burn news. We're seeing a shift in market sentiment. Buyers are starting to get excited about scooping up altcoins. Of course, it's all speculative, but what drives the value of any given cryptocurrency over time is the fact that people will hold more than they spend. So far, demand has outpaced supply on larger timeframes for many cryptos, so one can assume that this will continue to occur, even if the process slows down a bit. But this is essentially why I've started posting some altcoin charts recently, even if they're highly speculative.
I want to emphasize that SLT was actually one of the best performers during all of 2018, outpacing both BNB and LINK. It might have actually been the best performing coin in the entire market for a while. While the rest of the market declined 90%, SLT actually gained in value, rising from below $1 in February, 2018, to an all-time-high of $7 in the fall. It also went parabolic against XLM (its primary trading pair). I originally bought at 2 XLM, and as it went parabolic a year ago, I sold some of my position at much higher levels (18, 23, and 43 XLM). I'll admit - I got lucky. I didn't know anything about the project or its potential when I first bought some. It was one of those things where I was looking to put a tiny amount of money into a couple of small projects. Ultimately, SLT went from less than 3% of my portfolio to over 20% at one point. Now, it's back to 3% of my portfolio, even after tripling my original position and taking some profit. That's how poorly it's performed since April. Despite this decline, SLT has done extremely well in the past, and I don't think its fundamentals have changed since then. I'll explain why further down.
As you can see, SLT is worth only a small fraction of its previous Bitcoin and XLM value. Just look at this chart! SLT declined 98% (NINETY-EIGHT PERCENT) in Bitcoin value since it was listed on Bittrex. To most crypto investors, this would be a really bad sign. Even as much of the market continues to recover, SLT is close to its original market price and has erased almost all of its gains. A while ago, I actually wished I could see low prices like this for Smartlands again. I think it represents one of the greatest risk/reward plays in the market. With a total supply of 7 Million coins, one needs only 7000 SLT ($3000 currently) to own 1/1000th of the total supply. That's the equivalent of owning 17,000 Bitcoin, or what would now be worth close to $160 Million. For whales, $3000 is nothing. If even one person with a decent amount of "play money" decided SLT was worth owning, they could buy a huge chunk of the supply. At the present time, this would be hard to do, since Smartlands has a liquidity problem with lots of regulative clarity needed. Over time, I expect this to change. Even owning 7 SLT is like owning 17 Bitcoin (in terms of supply percentage). Not that SLT will be worth Bitcoin's market cap, but I'm just using this to explain my reasoning of why I think it's a decent risk/reward play with even a small amount of money.
Although the price outlook may seem bad, I actually continue to support the project. I removed a couple of coins from my portfolio much earlier this year (WTC and GVT) - projects in which I had lost confidence. In hindsight, I do wish I had sold more SLT at the time, since it would have shielded me from some more losses. However, there are three main reasons why I have not let go of SLT, and why I think it can surprise many people yet again:
1) The Smartlands community actually continues to grow. Every day, more members join their Telegram group. This is actually the sort of divergence I like to look at, when trying to decide if something is worth holding onto. Does price reflect actual growth of the community and company? If not, it may be severely undervalued in the market. Take a look at VeChain. It has one of the largest crypto communities out there. But it's not even in the top 20. With coins like GVT and WTC (still glad I let go of those positions), I noticed declining communities and sour investor sentiment. I have not seen these things with SLT, aside from some disappointment with regard to price (understandable).
2) The Smartlands team continues to work hard, venturing into a very difficult new frontier (the STO market). They've also worked to gain access to U.S. investors, which is something a lot of projects have completely shied away from.
3) As mentioned above, risk/reward
Now to the technical analysis:
We can see that SLT did break the steep downtrend, but not before declining even deeper in Bitcoin value. Right now, it seems to be forming a bit of a rounded bottom (orange), butting up right against another descending resistance. The RSI and ultimate oscillator look like they're trying to break out. If SLT can break the downtrend, perhaps with a little help from XLM, then I think it can explode upwards. I'm not saying that it will get back to ATH any time soon, but I've marked important levels in pink on this chart for reference The light blue zone is especially important. That's where the highest volume trades occurred over the last several months. Also in terms of volume, sellers have dominated over the last several months, but recently they've started to become exhausted. What would be great is if buying volume can start to outpace sell volume at these current levels. That could fuel a breakout.
What's also interesting is that the 200 Day MA is just forming overhead (light blue). This is a good thing, because it will give traders more indicators to use moving forward, and it'll allow them to understand the trend in the long term. What we want to see is these moving averages continue to level out, as buyers become more confident that this is the floor. As buyers show up, we'd want those moving averages to start curving up. It's also important for XLM break out from its bear market downtrend once and for all. It's VERY close to doing this. It rose above the downtrend briefly yesterday. Speaking of XLM, I did make an effort to call the bottom below $0.06 not too long ago.
Anyway, this is not financial advice. My perspective on the market has been fairly accurate over the last year, but that does not mean I haven't been wrong, or made some egregious calls. My posts represent my opinion only, and should be used for educational and entertainment purposes. I like to post these for future reference, to permanently record whether I was right or wrong.
Hope you enjoyed this post, and thanks for your support!
-Victor Cobra
As some of you may have noticed, low cap altcoins have gotten the worst treatment since this past Spring. This is why a lot of "seasoned" crypto traders will hold mostly Bitcoin and Ethereum during bear markets and then diversify out as a floor becomes more obvious. We're seeing that happen right now. It may not be fairly obvious yet, but cryptocurrencies are starting to react positively towards news, and several are making serious attempts to break out. Just look at VET, NEO, ONT, TRX, and others on the China news. Look at XLM from yesterday's coin burn news. We're seeing a shift in market sentiment. Buyers are starting to get excited about scooping up altcoins. Of course, it's all speculative, but what drives the value of any given cryptocurrency over time is the fact that people will hold more than they spend. So far, demand has outpaced supply on larger timeframes for many cryptos, so one can assume that this will continue to occur, even if the process slows down a bit. But this is essentially why I've started posting some altcoin charts recently, even if they're highly speculative.
I want to emphasize that SLT was actually one of the best performers during all of 2018, outpacing both BNB and LINK. It might have actually been the best performing coin in the entire market for a while. While the rest of the market declined 90%, SLT actually gained in value, rising from below $1 in February, 2018, to an all-time-high of $7 in the fall. It also went parabolic against XLM (its primary trading pair). I originally bought at 2 XLM, and as it went parabolic a year ago, I sold some of my position at much higher levels (18, 23, and 43 XLM). I'll admit - I got lucky. I didn't know anything about the project or its potential when I first bought some. It was one of those things where I was looking to put a tiny amount of money into a couple of small projects. Ultimately, SLT went from less than 3% of my portfolio to over 20% at one point. Now, it's back to 3% of my portfolio, even after tripling my original position and taking some profit. That's how poorly it's performed since April. Despite this decline, SLT has done extremely well in the past, and I don't think its fundamentals have changed since then. I'll explain why further down.
As you can see, SLT is worth only a small fraction of its previous Bitcoin and XLM value. Just look at this chart! SLT declined 98% (NINETY-EIGHT PERCENT) in Bitcoin value since it was listed on Bittrex. To most crypto investors, this would be a really bad sign. Even as much of the market continues to recover, SLT is close to its original market price and has erased almost all of its gains. A while ago, I actually wished I could see low prices like this for Smartlands again. I think it represents one of the greatest risk/reward plays in the market. With a total supply of 7 Million coins, one needs only 7000 SLT ($3000 currently) to own 1/1000th of the total supply. That's the equivalent of owning 17,000 Bitcoin, or what would now be worth close to $160 Million. For whales, $3000 is nothing. If even one person with a decent amount of "play money" decided SLT was worth owning, they could buy a huge chunk of the supply. At the present time, this would be hard to do, since Smartlands has a liquidity problem with lots of regulative clarity needed. Over time, I expect this to change. Even owning 7 SLT is like owning 17 Bitcoin (in terms of supply percentage). Not that SLT will be worth Bitcoin's market cap, but I'm just using this to explain my reasoning of why I think it's a decent risk/reward play with even a small amount of money.
Although the price outlook may seem bad, I actually continue to support the project. I removed a couple of coins from my portfolio much earlier this year (WTC and GVT) - projects in which I had lost confidence. In hindsight, I do wish I had sold more SLT at the time, since it would have shielded me from some more losses. However, there are three main reasons why I have not let go of SLT, and why I think it can surprise many people yet again:
1) The Smartlands community actually continues to grow. Every day, more members join their Telegram group. This is actually the sort of divergence I like to look at, when trying to decide if something is worth holding onto. Does price reflect actual growth of the community and company? If not, it may be severely undervalued in the market. Take a look at VeChain. It has one of the largest crypto communities out there. But it's not even in the top 20. With coins like GVT and WTC (still glad I let go of those positions), I noticed declining communities and sour investor sentiment. I have not seen these things with SLT, aside from some disappointment with regard to price (understandable).
2) The Smartlands team continues to work hard, venturing into a very difficult new frontier (the STO market). They've also worked to gain access to U.S. investors, which is something a lot of projects have completely shied away from.
3) As mentioned above, risk/reward
Now to the technical analysis:
We can see that SLT did break the steep downtrend, but not before declining even deeper in Bitcoin value. Right now, it seems to be forming a bit of a rounded bottom (orange), butting up right against another descending resistance. The RSI and ultimate oscillator look like they're trying to break out. If SLT can break the downtrend, perhaps with a little help from XLM, then I think it can explode upwards. I'm not saying that it will get back to ATH any time soon, but I've marked important levels in pink on this chart for reference The light blue zone is especially important. That's where the highest volume trades occurred over the last several months. Also in terms of volume, sellers have dominated over the last several months, but recently they've started to become exhausted. What would be great is if buying volume can start to outpace sell volume at these current levels. That could fuel a breakout.
What's also interesting is that the 200 Day MA is just forming overhead (light blue). This is a good thing, because it will give traders more indicators to use moving forward, and it'll allow them to understand the trend in the long term. What we want to see is these moving averages continue to level out, as buyers become more confident that this is the floor. As buyers show up, we'd want those moving averages to start curving up. It's also important for XLM break out from its bear market downtrend once and for all. It's VERY close to doing this. It rose above the downtrend briefly yesterday. Speaking of XLM, I did make an effort to call the bottom below $0.06 not too long ago.
Anyway, this is not financial advice. My perspective on the market has been fairly accurate over the last year, but that does not mean I haven't been wrong, or made some egregious calls. My posts represent my opinion only, and should be used for educational and entertainment purposes. I like to post these for future reference, to permanently record whether I was right or wrong.
Hope you enjoyed this post, and thanks for your support!
-Victor Cobra
Note
Looks like trading is currently disabled for SLT on Bittrex. Stellarterm is still functional. This is what I mean by low liquidity and a lot of hurdles to get through. Crypto is risky, but lower cap coins are particularly so. We'll see if they can pull through over the next few months.
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