This Chart Attack is going to be a bit different. Because the company in question, Wellfield Technologies (WFLD.V) goes public TODAY. Yes, that’s right, no chart to talk about, but I will treat this as I do all my other IPO’s: give the stock some time to establish highs and lows, and then some support and resistance levels that we can work with. What we can do is take a look at the current stock market and crypto strength to determine how the IPO will shape up. But first, a bit about the company, and a lot of this will be coming from Chris Parry’s breakdown which can be read in its entirety here.
The stock is all about DeFi. For those that follow my work, you know I have bought NFTs and a few DeFi tokens. One big issue I have had is using Ethereum for purchases. A lot of people tout Cardano as the Ethereum killer, or mention other projects when it comes to linking the DeFi ecosystem. Right now, Ethereum is used to purchase NFTs and some DeFi tokens that can only be traded on Uniswap or Sushiswap. The thing that I hate? Ethereum’s gas light fees. Pretty ridiculous, but fees have improved with Ethereum upgrades, and will improve further with Ethereum 2.0. I really think this will be a big deal. If this is not fixed, then people will want to, or look for, other tokens to play the DeFi market.
Enter Wellfield Technologies.
- Wellfield’s wholly owned subsidiary – Seamless Logic Software Limited – fills critical infrastructure gaps in today’s Decentralized Finance (DeFi) ecosystem, through the development of decentralized protocols for the Ethereum and Bitcoin blockchains.
- The Company’s MoneyClip brand leverages decentralized technology to offer consumer-facing financial applications powered by blockchain, giving consumers easy access to, and greater control over their money, harnessing the full value and flexibility offered by DeFi.
Wellfield’s investor and chairman is a guy named Marc Lustig. If you have been following the Canadian markets you have heard his name pop up once or twice. Lustig has been placing big bets on biotech and cannabis stocks, and now he is front and center on Wellfield. This is a big deal, and will ensure the stock receives interest and will have no issue raising funds if need be.
Here is what Lustig had to say about this opportunity:
“The Wellfield leadership team has identified an area of their industry that no one in the public markets is addressing – which will generate strong interest and more importantly will support a robust valuation with a real, hyper-growth business,” Lustig told investors yesterday. “The most directly comparable projects (eg. Uniswap, Thorchain, Celsius, Aave, Synthetix) aren’t available to public equity investors and all currently have multi-billion-dollar valuations. The publicly listed companies marketed to DeFi investors today are not direct competitors, but trade at valuations far above WFLD’s latest $1.00/share RTO financing which valued Wellfield at $113M fully diluted prior to its coming public listing.”
Let’s look at some comparables:
- Voyager Digital (VOYG): $3.26B CAD
- Defi Technologies (DEFI): $725.82M CAD
- Wonderfi Technologies (WNDR): $220M CAD
DeFi, in my opinion, is going to be a big talking point in the very near future. If regulations come to cryptos, then a lot of hardcore crypto enthusiasts will be looking at DeFi. Actually, let’s rewind that a bit. Hardcore crypto enthusiasts are already looking at DeFi, frontrunning eventual regulations. Remember, crypto was supposed to be away from the reach of big government, big banks and big corporations. These groups are making their way into the mainstream crypto narrative. DeFi to the hardcore crypto enthusiasts, will be what crypto was supposed to be when Wall Street and others get involved with traditional crypto assets. Once we see those regulations come in, watch the DeFi space.
Stocks such as Wellfield will be worth watching. Since I have no chart to work with for Wellfield, all I can say is that I will treat it like all IPOs. This is just me, but I personally like to wait for the IPO to release and then wait a few days or weeks. This allows price to develop highs and lows as well as support and resistance levels to work with. If the stock pops and then drops on the IPO, and then develops a nice support range…I would be looking to buy on that dip.
Let’s take a look at other crypto’s to determine how the IPO will fare, but of course it also depends on how many people in the market know about this IPO and are following the story.
Right now crypto’s are moving with the stock markets. Why? Because both are risk on assets. There is a great correlation. Stock Markets ended up green on Monday, and crypto’s had a nice day. If both are green, they can play a part in a green first day IPO for Wellfield Technologies.
Bitcoin might not be out of the woods just yet. I will rest more easily once Bitcoin closes above $60,000. Right now, this zone is still near term resistance, or a price ceiling. Seeing some selling there as evident by today’s candle. Let’s see how Bitcoin reacts today. It will be a big day for it.
Meanwhile Ethereum is faring a bit better on the technicals. Maybe it is because of its use for DeFi, and retail traders running into NFTs and DeFi tokens. A nice support dip bid at $4000. If we can close above my moving average and above $4550 tomorrow then we will be talking about Ethereum new record highs possibly by the end of the week.
