RSR (Reserve Protocol) TA Sunday - February 2021 Reports

DISCLAIMER: “TA Sunday” is for entertainment and informational purposes only and is not meant to be construed as financial advice of any kind. All investments carry risks.
“TA Sunday” is not endorsed or supported by the Reserve Team, or any of its affiliates.
RSR TA SUNDAY - February 2021
February 2021 - Editions 6 - 9

February 2021 - Edition 9

RSR TA SUNDAY - 9th Edition
Contents
1. TA Sunday - Everything is Macro
2. Reserve & Other Stablekoinz - An Overview Of the “Competition”
3. TA Timeframe Analysis - Monthly, Weekly, Daily USD Pairs, Daily BTC
Pair

RSR TA SUNDAY - February 28th, 2021
Happy Sunday - Rangers, what a week. Wicking down to our longer-
term resistance level at $0.035 that we have been mentioning here
for several weeks, and then rallying on some great news going into
March up to nearly $0.060. Congrats to all who bought the dip. I do
view this as a final consolidation and test. Unlikely we dip to below
$0.040 again. Although we did not reach my February targets due
likely to our less-than-ideal macro backdrop, I still feel confident in
the $0.10 - $0.12 target for March. I still consider RSR buys below
$0.065 to be gifts we should cherish, as they will not be available for
long.
Marzo! Just around the corner. The Reserve Team announced opening the
app to all in Venezuela, news on which RSR rallied over 20% in a tumultuous
market. Imagine when they start releasing data. Things are just starting to
get interesting. I expect us to experience quite a ride in the coming months,
as network effects take hold, more users join the ecosystem, and the app
continues to scale along with the team.
Everything is Macro
One major event occurred last week following a significant sell-off in bitcoin at the beginning of
the week. For the first time in nearly a year, markets began pricing in higher growth prospects
for the economy, and calling the bluff of the Fed to either raise rates or buy Treasuries
themselves. This sell-off in Treasuries pushed rates higher, causing a sell-off in the tech sector
and risk assets, since future cash flows are no longer discounted at a “risk-free” rate of
essentially 0%, meaning that valuations are no longer what amounts to infinity. In a market
where almost everyone is levered long, this caused what is colloquially known as “max pain”.
The key thing to watch for this week is whether the markets correctly called the bluff of the
Fed. Will they keep funding QE Infinity through Japanification of debt (Fed buys Treasuries,
pushing yields down and keeping rates low), or will they raise rates to the level that investors
expect due to the higher risk being introduced by even more stimulus, and the inflation that
may come with it?
My guess is that the Fed backstop is never going to end - moral hazard is completely removed.
Risk assets will continue to outperform, and tech as a growth sector will continue to do well in
this environment. It will take years to have an impact on the dollar as a global reserve currency,
but in this environment, having an adaptable decentralized stablecoin with dynamic underlying
collateral is something everyone should be hoping for, and something that the Reserve team is
looking to deliver.
A final note - it seems likely that along this macro backdrop, we had the bitcoin carry trade
impact price as well. Large positions of spot bitcoin are sold off to cover short futures positions
and roll them into the next month (or future months) as CME futs closed on Friday. The
popular and profitable carry trade is to hold spot / short out month futures as they trade at a
premium and unlike other futures there is no cost of delivery to worry about. You sell spot btc
to cover, and buy back at a lower price, driving up the futures price which you then short once
again - rinse, and repeat. My sense is that we will see strength into next week as this end of
month rebalancing should by now have played out. Perfect storm of macro + rebalancing
makes for stormy seas for smaller altcoins, though Reserve did overperform on fundamentals
vs. many other cryptos.

Governance + Stablecoin - Dual-token stablecoin systems.
LUNA (Terra) UST (TerraUSD)
RSR RSV (Reserve) MKR (Maker) DAI (Dai) OGN (Origin Protocol)
OUSD (Origin Dollar)
MTA (Meta) MUSD (mStable)
Data is from Coingecko as of February 28th, 2021, market cap is in USD
Governance
Stablecoin
Koin Current Market Cap Use Case Token Type
RSR 492,000,000 Governance + Collateral ERC-20
MKR 1,858,000,000 Governance + Collateral ERC-20
OGN 72,000,000 Governance ERC-20
MTA 37,000,000 Governance + Collateral ERC-20
LUNA 2,300,000,000 Staking + Collateral Native PoS
RSV 1,500,000 Consumer Transactions + Saving ERC-20
DAI 2,360,000,000 Trading + Lending ERC-20
OUSD 6,500,000 Yield Generation ERC-20
MUSD 45,600,000 Yield Generation + Stablecoin ERC-20
UST 692,000,000 Yield Generation + Stablecoin ERC-20

Single Stablecoin Systems
ESD (Empty Set
Dollar)
USDT (Tether)
USDC (Circle)
TUSD
(TrueUSD)
GUSD (Gemini)
AMPL (Ampleforth)
PAX (Paxos)
BUSD
(Binance)
Koin Current Market Cap Use Case Backed By
USDT 35,000,000,000 Trading / USD on Crypto Rails USD in Bank Account (Maybe)
USDC 9,000,000,000 Trading / USD on Crypto Rails USD in Bank Account (Probably)
TUSD 300,000,000 Trading / USD on Crypto Rails USD in Bank Account (Probably)
GUSD 123,000,000 Trading / USD on Crypto Rails USD in Bank Account (Probably)
AMPL 330,000,000 Trading / AMM Balancing Elastic Supply
PAX 890,000,000 Trading / USD on Crypto Rails USD in Bank Account (Probably)
BUSD 2,375,000,000 Trading / USD on Crypto Rails CZ or Paxos or something
ESD 57,000,000 Trading / AMM Balancing Elastic Supply
USD-backed- Single stablecoin systems.
These often operate as centralized money market funds, where value accrues to the issuer and
counter-party risk is significant. It is a bank account with a token that is “redeemable” for physical
dollars and typically audited monthly by a third party.
Algorithmically-backed- Single stablecoin systems.
Typically, these employ an elastic supply that adjusts on some time schedule to aim for a certain
value per token. There is smart contract risk as well as concentration risk due to the teams either
holding a high proportion of the tokens in the network, or being anonymous.

Let’s look at the competitors in terms of market cap of stable coins, and where they
are heading in terms of collateral types and centralization.
Centralized Decentralized
Flexible Collateral Types
Inflexible Collateral Types
The MKR/DAI model is likely the closest thing to
what Reserve aspires to become, at least in terms
of decentralization and ubiquity. However, with
the collateral types being heavily crypto-focused,
and DAI being a tool used primarily by traders, it
is at a disadvantage in some respects.
For this reason, in future editions, I will be doing
more analysis on MKR/DAI model as a basis for
comparison to Reserve in the future, along with
some more analysis on the growth of “legacy”
networks such as Square and Paypal, to get a
better sense of where Reserve may be able to
most thoroughly compete.
The inflexibility and volatility (and indeed, risk) of other
protocols makes it difficult to be an attractive option for
users. This is especially the case with AMPL and ESD.
It is too new to fully analyze, but the defi protocols
underlying OUSD may eventually make sense to include
as part of the RSV collateral, however these certain
prove to risky currently.
Centralized stablecoins, which is what most
crypto users are familiar with today, serve
primarily as fiat on-ramps and off-ramps
between the old world an new world of
finance. I imagine these fall out of fashion
with the advent of CBDCs and the
realization to users that these are heavily
centralized tokens which carry significant
counterparty risk.
The best stalecoin architecture is censorship-
resistant and unconfiscatable. It can also change its
underlying collateral based on changes in market
dynamics and the macro backdrop. Unfortunately,
these platforms are likely too centralized and
inflexible in their underlying collateral architecture.

Contents
1. TA Sunday - Everything is Macro
2. Reserve & Other Stablekoinz - An Overview Of the “Competition”
3. TA Timeframe Analysis - Monthly, Weekly, Daily USD Pairs, Daily
BTC Pair

Monthly Timeframe (USD Pair, Log Scale)
It’s always healthy to zoom out. The monthly chart for RSR looks absolutely
beautiful. We continue closing months on higher highs, despite intra-month
volatility. The pattern here looks quite similar to our May/June/July uptrend,
which was followed by a massive candle higher and then retracement. Though
I don’t expect a retrace, I would not be surprised to see a month of strong but
steady growth into the $0.10 - 0.12 region.

Weekly Timeframe (USD Pair, Log Scale)
Marzo is finally here! I expect an exciting month ahead, with consolidation on
the weekly showing strength and continued buys ahead for RSR.
Catalysts for a move higher are now being realized (Viva El Marzo!) which sets
the stage for a break of our resistance between the 21 Week EMA, which we
wicked down to last week, and the upper resistance shown from the last
several weeks.

Daily Timeframe (USD Pair, Log Scale)
Our second scenario played out last week, though with a bit more pain than I expected (congrats on
all who got entries in below our $0.045 resistance level):
2) We continue to consolidate toward the end of this month, with the $0.045 - $0.050 level
continuing to be strong resistance, then bounce higher at the beginning of March (which will
likely be a strong close on the monthly).
I expect continued uptrend on daily closes in the channel shown, and will be looking for price
discovery toward our next targets in the $0.10 - 0.11 range in the coming weeks. A crossover on
MACD will be HIGHLY BULLISH as well, as shown below.

Daily Timeframe (BTC Pair, Linear Scale)
The trendline has been adjusted to reflect some of the daily close pain we experienced last week, however the general trend is still intact, with
RSR continuing to perform well against BTC.
I’ll maintain probabilities for last week’s comment on the RSR/BTC pair. Interestingly, we have a crossover the MACD which is typically HIGHLY
BULLISH behavior, so I’ll look for continuation in our outperformance against BTC, and look for daily closes above the 130 mark to signal our
consolidation is over, although it could continue through mid-June before breaking out higher.
Will be watching this one closely for a reversal. Early indicators are we could see this in mid-March, especially if bitcoin experiences a pullback
after it continues its move higher into the $60K-region, as many expect it to.

Contents
1. TA Sunday - The First Follower
2. TA Timeframe Analysis - Weekly, Daily USD Pairs, Daily BTC Pair

RSR TA SUNDAY - February 21st, 2021
Happy Sunday - Rangers, following our exciting week of all-time
highs, we’ve experienced some healthy consolidation around the
$0.050 mark.
I expect this trend to largely continue until we see one of two things occur -
either money flows from a higher bitcoin price start propelling all altcoins
forward, or the Reserve team progresses in their work to the point where the
long list of customers begin to access the app in open beta. As indicated by
hiring, we can safely assume this will happen in the next one or two weeks.
The 20 support staff starting Monday will need at least a week or two to be
fully trained, at which point I would expect the app to be opened.
Other hiring roles are exciting as well, and its encouraging to see progress in
these areas. As new team members come on board, I expect additional
catalysts to continue rolling in faster and faster over the coming months.
My target in the next 1 - 3 weeks remains in the HIGHLY BULLISH state as I
expect these catalysts to take shape and propel us into the $0.10 - $0.11
range, and RSR launches to new highs.
A final note on the longer-term analysis discussed last week - I’d like to
produce some high-quality work here, so will take a bit more time to put
together. Likely starting with a broader competitive analysis across all
stablecoin solutions in the market today, and then a deeper dive on RSR and
RSV. Looking forward to sharing in the coming weeks!
Scaling The Team & The Importance of User Experience
(I believe, but could be a little off here) that the Reserve Team has roughly 20 core members.
Let’s assume this is the case. It may not sound like much, but the 12 new roles that opened
means they’re nearly doubling the team with this round of hires. This is a huge step in the right
direction, and likely represents the upper limit of what the team can bring in at this point - they
need to hire with quality, keep the right culture, bring new people up to speed and let them
settle in, and allow them the freedom to grow within their role.
Add to this, 20 support team members starting tomorrow - and the path forward is clear;
March will be a month where we begin to see the growth that the team has been working on
for such a long time.
The “jobs to be done” framework and Aggregation Theory (excerpt below) is a good one that I
think can be applied here as the team scales (recommend all to read). It’s all going to be based
on user experience. How will Reserve create the best platform for a decentralized stable coin
that effectively combats inflation and protects the wealth of its consumers? How do we create
a product that customers love and want to share and promote within their own networks? This
is why the team isn’t rushing a product, but rather taking its time. We are just getting started.
A note on user experience and Aggregation Theory (Ben Thompson, Stratechery):

After a week of downside consolidation, which was not unexpected, it is likely
our resistance line at $0.045 will continue to hold well as support.
Given our close below the $0.065 mark, I am still looking for at least a daily
close above that point to confirm trend reversal and head higher. Any
purchases in the $0.045 - $0.060 range can be considered low-risk entries.
Catalysts for a move higher are clear - Reserve will be adding customers in
March, as indicated by their announcements on hiring support staff. It depends
on how they choose to communicate these changes, and whether their
automation has progressed to the point where they can begin truly scaling.
Technically, it appears most advanced traders are staying the course and
waiting for these positive catalysts to be realized.

I believe we still have strong potential for a run at $0.10 before the end of February. However as
mentioned last week, a close above $0.065 on the daily did not occur and therefore I would say the
probabilities have diminished. The two scenarios I see playing out are:
1) We break higher this week, with price discovery occurring toward the $0.10 level, which is the
next extension of our historic cycle and long-term resistance from the $0.048 level.
2) We continue to consolidate toward the end of this month, with the $0.045 - $0.050 level
continuing to be strong resistance, then bounce higher at the beginning of March (which will likely
be a strong close on the monthly).

With bitcoin solidly over the $1T market cap mark as posited last week, we find many other crypto assets feeling some pain; RSR is no different.
Interestingly, it seems we may have found a long-term support on the trendline that first bottomed in late 2020.
Over the coming week, I’ll be looking to see us reverse from this trend and attempt another break for the 130 mark. Continuing to range in this
channel until the May timeframe is also possible, as it appears there may be some longer-term consolidation needed between RSR/BTC pair in
order to achieve the breakout against BTC.
Will be watching this one closely for a reversal. Early indicators are we could see this in mid-March, especially if bitcoin experiences a pullback
after it continues its move higher into the $60K-region, as many expect it to.

Contents
1. TA Sunday - The First Follower
2. TA Timeframe Analysis - Weekly, Daily USD Pairs, Daily BTC Pair

Happy Sunday - Rangers, exciting week of price action for
Reserve, and congratulations to all as we reached all time
highs of $0.078, hitting our target from last week on the
nose.
I am still looking for a monthly close for February above the
$0.10 mark. If we do reach this level, I expect something
closer to $0.11. This would closely mimic continuation in
mid to late August after breaking out from previous highs set
in mid-summer. This would put us at the top side of our
long-term channel which has been holding steady for the
last year.
This week I’ll be working through some initial analyses and
longer-term quantitative structures to help support our price
targets for RSR in the coming year, as well as 2022 and 2023
price targets. Will be looking forward to sharing my findings
in next week’s report.
Crypto Hits the Mainstream
Microstrategy and Michael Saylor’s treasury allocation strategy found
their ”First Follower” last week, with Elon Musk and Tesla adding $1.5B
worth of bitcoin to their balance sheet. Having a strong first follower
for crypto couldn’t be more important, and largely removes the career
risk for CEOs and CFOs looking to make the jump into crypto. The first
one looks kind of odd all alone, the second one comes in and now
people are watching, and before we know it, everyone is in.
What could this mean for Reserve? Well, first of all, crypto assets
across the board will be repriced accordingly. We’re seeing it right now
in everything from the shittiest shitcoins to NFT art. And this means
more capital and talent will flow into the space. Reserve’s assets,
namely RSV and by extension RSR, will gain mindshare from both users
and third-party platform owners. As the team at Reserve grows by
adding top talent and continues to execute on its vision for building out
the app ecosystem, they are poised to not only be able to continue
executing on their product vision, but the market will be accepting of
their ideals at the same time - a perfect storm for substantial
appreciation in the value of these assets. Most of all, decentralized
systems such as the one Reserve is building have the potential to
drastically improve the lives of millions of users, which, as the great
Shaquille O’Neal would say (2019), is how he built his entire net worth.

After reaching our short-term target for upside last week at the
0.5 Fib extension ($0.078) I believe we’re entering into a new
“phase” of price discovery and consolidation for RSR based on
timing of previous “cycles”. I expect us to continue higher in the
coming months, quickly passing through a psychological $0.10
threshold at which point we’ll begin looking for targets in the
$0.17 to $0.30 range. Ultimate downside is likely our resistance
line at $0.045 which should flip cleanly into support.
Though it would have been encouraging to close above the $0.065
mark this week, I will be monitoring this level closely as a close
above would signal strong continuation of our existing pattern.

The next few days will be interesting to watch, as we prepare to
wage war against short-term support of our bullish trendline on
the daily from the last week. I believe we now have strong
support at the 0.045-0.050 level, and any break above $0.065
should mark continuation of our bullish pattern.
As evidenced by our trendlines in MACD, we still likely have
juice in the tank to sustain a rally further ahead until
consolidating further. This is a time to add on dips and enjoy
the ride higher.

RSR broke out against the historical 130 sats level resistance, rocketing to 167 sats before settling back to our resistance zone at
125 - 130 sats. I’ll be looking for a retest and ultimate break of this level. Bitcoin is showing strength as short sellers continue to
knock it down over the holiday weekend, but the $50K level seems almost inevitable for bitcoin at this stage. At $55K bitcoin is
solidly a one trillion dollar asset, which means more capital can flow into the space, generating even higher multiples for smaller
projects like RSR. Ultimately it is likely that we will continue this uptrend in the coming months, and the 130 sats level will flip to
serve as resistance as RSR continues to execute against its roadmap and realize the many catalysts ahead.

Contents
1. The Month Ahead in TA Sunday
2. What to Look For This Week
3. TA Timeframe Analysis - Monthly, Weekly, Daily USD Pairs

Quick Reminder - Upcoming Focus for February TA Sunday:
Reserve Valuation & Future Thinking. This is the most exciting but
will require A TON of work to make it meaningful. What could the
future hold for Reserve? Will be thinking big and bold here and
making LOTS of assumptions.
Competitive & Strategic Analyses. Will look at some Shitcoins and
Fintechs, and geographies, and other “bottoms-up” analysis to
better understand the opportunity and challenges ahead for
Reserve.
More timeframes & pairings on TA. Something that’s needed for
better TA! I’ll probably start looking at daily, monthly, and BTC
pairings. Easy stuff and expect for next week’s report.

Happy Sunday - Rangers, yet another thrilling week of price
action in Reserve. Like many, I believed we might have been
on track for a $0.05 party where we would finally see
Kryptobum drop his track. Alas, we’ll need to wait a couple
more weeks. I’ll keep my commentary on price action the
same as last week’s report as failure to close below $0.035 is
indicative of continued bullish movement in the coming
weeks.
Upside targets for February are still in the $0.065 - 0.078
range, however as noted last week the failure to breach
$0.05 likely extended our timeline for these levels into mid-
February. Consolidation has been healthy, with the
resistance level of $0.031 tested multiple times before
ultimately carrying above $0.035 to close the week.
On the watch list for this week:
RSR Token Unlock - commences tomorrow, four weeks from when the unlock
process began on January 11. Historically this has been bullish as it marks
another milestone in the development and progress of the Reserve ecosystem.
Looking forward to seeing the team deploy funds to continue growing RSV usage
and accruing value to RSR holders.
Chinese New Year Commences February 12th - historically there has been a
selloff leading into CNY, when gifts of gold and cash are popular, followed by
positive price action in crypto as investors share ideas on holiday and move cash
back into crypto markets. It is hard to say whether this will have an impact given
limited travel this year during what is normally the largest collective migration of
humans at any given point. Worth noting we are entering the Year of the Ox (see
OCPI indicator from January TA Sunday).
Reserve Website Redesign - excited to see what comes of this, just look at how
beautiful the new Hola Reserve website looks.
Reserve Beta Program - 500 new beta testers this month will start to share their
thoughts about the app, which has been extremely positive thus far. Looking
forward to hearing more from the team as the program makes progress this
month.
US Stimulus - Likely that another BRRRRR $1.9T package is passed in the near
future, although a portion of this will likely be infrastructure-related which may
not find its way into financial markets as quickly as stimulus from the last 12
months.

Monthly Timeframe (USD Pair, Log Scale)
I wanted to look at our monthly candles, as we
just closed January last week. Interestingly, it
appears we are toward the end of a 6 month
cycle that last occurred from February -
August of 2020 and saw an overall gain of
540%. This cycle appears to be repeating with
a monthly close over the previous cycle high in
January. If this plays out in February we would
see a February close over $0.10,
approximately +250% this month.
These gains seem to be supported by
fundamentals - with app usage growing
through the beta program and our token
unlock beginning this week which typically
coincides with bullish continuation.

Another week of ranging and further
consolidation in RSR has brought a strong
close above early January support at
$0.036. One notable price move was
rejection at our 0.786 Fib level. Any
weekly close above this point ($0.046)
would be highly bullish. A break above
$0.05 to close the daily intra-week can
also be considered a bullish
continuation.

Strong support at the $0.031 level and resistance in the upper
$0.04 region has generated sideways consolidation, similar to
what we can see in the late December timeframe. As
evidenced by our MACD crossover highlighted below, RSR
experienced a surge to break through the $0.03 resistance
turned support. I strongly believe we are setting up to repeat
this for a five penny party in the coming 1-2 weeks. Perhaps
continued consolidation can be expected in the $0.03 - $0.04
region before breaking out.

Since we would normally chart both BTC and RSR as Logarithmic functions against the dollar, we can look at them in linear scale to
develop fair assertions against where the pair may go. Interestingly, where many charts such as XRP look absolutely hideous against
BTC, RSR actually seems to be consolidating and generating strong sideways movement against its BTC pair.
A hypothesis for this is the strong fundamentals and backers for Reserve brings higher quality investors into the project, as well as
the market need for a decentralized stablecoin being as strong as the narrative that bitcoin holds as a “Gold 2.0”.
I expect bitcoin to continue its upward trajectory this year, reaching unfathomable levels in the $200K - $300K region this cycle (and
perhaps beyond). Even if RSR continues sideways against its BTC pair this is highly favorable for the price of RSR in dollar terms.
Bullish upside seems to be above the resistance shown, which would be a breakout against BTC at around 130 sats. Historically this
would be our “alt szn” which likely has not yet begun.

RSR (Reserve Protocol) TA Sunday - February 2021 Reports

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