Crypto Market Commentary & Outlook
(January 19 – 2022)
Bitcoin (BTC) Technical Analysis & Outlook
Considering it’s a very slow week in terms of newsflow and there are still very mixed technicals overall, it comes as no surprise that price continues to tread water in the low-$40k’s as expected with bouts of downside volatility that we have been calling for a few weeks now. While it appears as though this trend will continue over the near-term due to some shorter-term technical patterns, we do think a directional breakout is increasing in likelihood over the next few weeks. No doubt it’s a fool’s errand to try to predict which way the market will initially move, we think the probabilities lie with a false breakdown below $40k followed by a sharp rally back towards $50k in early February.
TradingView Bitstamp BTC/USD 4-hour linear chart
Let’s begin with a look at the 4-hour chart for a close-up view of the short-term technicals where we can see that price is still coiling within what appears to be a messy symmetrical triangle formation on very mixed candles, a hodgepodge of SCMR signals, highly uncertain market structure, and an unhelpful TD count, all suggesting more choppy sideways price action in the $40k region over the near-term. The still bearish moving averages and stagnant momentum and volume indications will also add to the indecision by both bulls and bears over the remainder of the workweek, however a confluence of support in the $40k – $41k area is keeping the hope of a higher low alive so we would consider nibbling on the long side if price dips a bit more this week.
Short-term Trade Idea: Buy weakness below $41k for shorter-term upside to the $44k area.
TradingView Bitstamp BTC/USD weekly linear chart
Next, we’ll look at the daily chart for a slightly longer-term view of the market where we can see that price is back down in the demand confluence area where some support continues to emerge thus keeping the market inside of what appears to be an accumulation zone, decent news for the bulls moving forward. Having said that, SCMR signals remain red, the TD count points to at least 4 more days of bearish pressure, the shorter-term moving averages continue to fall, and the momentum and volume indications leave much to be desired for now, so we’re still quite cautious and need to see more from the bulls before reversing our predominantly bearish stance. (NOTE: If we lose the $39,558 regional low then $37k – $38k is the next area of interest.)
Long-term Trade Idea: Accumulate below $40k for longer-term upside to around $120k.
Monero (XMR) Technical Analysis & Outlook
TradingView Poloniex XMR/BTC daily linear chart
XMR/BTC is moving back to the downside this week following the spike higher last week, a move that will either become a confirmed double top that will lead to much more downside or is the top of a range that will likely remain intact for a while moving forward, so either way lower prices are likely over the near-term. The bearish candle formation today, the bearish TD count, the discouraging momentum oscillators, and a lack of support immediately below the market also point to downward pressure on the market over the coming days, although there remains a ton of confluence in the mid-0.0040’s which is where we continue to be interested in adding to positions.
Trade Idea: Accumulate below 0.0045 for longer-term upside to around 0.0100.
TradingView Bitfinex XMR/USD daily linear chart
XMR/USD never put in a double top like the BTC pair above but still looks poised for more downside over the near-term due to a discouraging candle formation today on a move back below the 50 SMA that is keeping market structure quite heavy while the longer-term moving averages remain bearish, so the bulls are certainly still on the defensive for now. The TD count also suggests several more days of lackluster price action, although we still think that sub-$200 prices are quite attractive from a longer-term perspective.
Trade Idea: Accumulate below $200 for longer-term upside to the $1200 region.
Ethereum (ETH) Technical Analysis & Outlook
TradingView Binance ETH/BTC 3-day linear chart
While ETH/BTC remains in a longer-term uptrend within a parallel channel formation, the shorter-term outlook is direr for the bulls considering that price is close to breaking down below the 50 SMA for the first time since the Spring correction of last year on a small doji candle, red SCMR signal, and bearish TD count, so the path of least resistance is currently to the downside. The fact that momentum is still recharging while money flow slows is also not a great sign for the bulls over the coming days, however the support confluence between 0.065 – 0.070 is still very attractive for longer-term accumulation so we’d get active on the long side again below 0.070.
Trade Idea: Accumulate below the 0.070 level with a longer-term target of 0.100.
TradingView Coinbase ETH/USD daily linear chart
ETH/USD is moving lower this week on bearish SCMR signals, still broken market structure, and a TD count that suggests 4 – 5 more days of downside all while the 100 SMA joins the 50 SMA in a downtrend, none of which bodes well for the bulls over the near-term. The stagnant momentum oscillators and a lack of money flow and volume are also keeping us on the sidelines over the coming days, unless a wick below $2800 materializes in which case we’ll buy the dip.
Trade Idea: Accumulate below the $2800 level with longer-term upside to around $12,000.
Equilibria (XEQ) Technical Analysis & Outlook
Coinigy TradeOgre XEQ/BTC daily linear chart
XEQ/BTC is still treading water just above the top of the upper demand area on a hodgepodge of small candle formations that are keeping shorter-term market structure intact but longer-term structure still bearish, all suggesting more of the same moving forward. The stagnant momentum and volume indications confirm this view, although if we do see some volatility we expect it to be to the downside to test support around the green line due to the falling moving averages so we’ll be ready to nibble on the long side if this opportunity presents itself.
Trade Idea: Buy weakness below the 0.00000500 level for longer-term upside to around 0.00002000.
CoinTraderPro CoinPaprika XEQ/USD daily linear chart
XEQ/USD has been bleeding slowly to the downside over the course of this week thus keeping market structure in the bear camp while the moving averages pick up steam to the downside and the momentum oscillators remain stagnant near the lows, all pointing to more choppy action over the near-term but with a slight downside bias. This outlook is no different than it has been for at least a few weeks now, so we’ll stay patient for the $0.20 area where support should become more substantial.
Trade Idea: Buy weakness below $0.20 for medium-term upside to the $2.40 area.
Good Luck, Good Trading!