Post-mortem on $PUMP:
- Was very bullish at 4bn and moderately bullish at 6.5bn. Was looking to size X% at 4 and about 0.6X at 6.5--this was mostly fine IMHO given the extent of demand during the ICO.
- Existence of pre-market perps changed the dynamics quite a bit. It became hard to differentiate "true" ICO demand vs. hedging demand--how much of the buying/oversubscription was looking to hedge vs outright long. I overindexed on the demand and thought the pre-market price was actually somewhat suppressed given hedging flows were pushing it down. This was very wrong--sustained positive funding on HL pre-launch and all perps post-launch indicated otherwise.
- Believed most of the spot longs that weren't long-term holders would've hedged out around 6-7bn given favourable funding + extent of time it traded up there + closeness to most people's targets. This was wrong--tough to know a priori.
- As a corollary, this trade became incredibly crowded. Every participant was long with the same target (8bn ez). Crowded/consensus trades are fine to take as long as further flows are coming (beneficial if those additional flows are exogenous to the cohort that is crowding). Smart-ish and regular money had already allocated to PUMP via perps even after ICO and there was no chance outside dollars were going to come into this product. @AlwaysBeThinkin about your exit liquidity.
- My price targets were looking to derisk between 7-8 given the memetic consensus around 8. This was too aggressive and that 7-7.2bn rough resistance level from pre-market was a good level to take some off.
- Risk-on markets are good for beta, but SOL was locally lagging and ETH chadding double digit percentages per day sucks attention and liquidity further away from a new launch that had to work through substantial ICO supply.
I am 90+% out of the position now. Think it has legs to run but opportunity cost of holding this is too high in this environment. I averaged in around low 6s and closed most around mid-4s. Took a big drawdown on this; was able to cover it and more given the current environment but put a sizable dent in the book. h/t @0x_Leo_ - he wrote some very good reflections that inspired me to share mine.
Onwards and upwards.
Show original38.66K
269
The content on this page is provided by third parties. Unless otherwise stated, OKX is not the author of the cited article(s) and does not claim any copyright in the materials. The content is provided for informational purposes only and does not represent the views of OKX. It is not intended to be an endorsement of any kind and should not be considered investment advice or a solicitation to buy or sell digital assets. To the extent generative AI is utilized to provide summaries or other information, such AI generated content may be inaccurate or inconsistent. Please read the linked article for more details and information. OKX is not responsible for content hosted on third party sites. Digital asset holdings, including stablecoins and NFTs, involve a high degree of risk and can fluctuate greatly. You should carefully consider whether trading or holding digital assets is suitable for you in light of your financial condition.