Crypto Market Commentary & Outlook
(June 3 – 2022)
Bitcoin (BTC) Technical Analysis & Outlook
Considering the down day we saw in the equity markets, the still bearish technicals in crypto, and news that the state of New York has passed a law banning carbon-based proof of work mining, it comes as a bit of a surprise that BTC prices are holding up as well as they are heading into the weekend. Granted, price has not reacted as positively as we had hoped off of the low-$29k’s recently, however there is still substantial support down to the mid-$28k’s which is where we’d like to see a more convincing move to the upside. If the bulls cannot step up to the plate, however, then we’ll move back to cash to wait for the drawdown to test the next area of support around $27k.
TradingView Bitstamp BTC/USD 4-hour linear chart
Today we’ll zoom in to the 4-hour chart to get a closer look at the current trading range where we can see that price is back down in the middle of the intermediate-term range and inside of the short-term OTE long zone where new TD support is forming while the momentum oscillators get close to recharged already, so there remains a decent shot at a bounce from this general area. Having said that, the candle formations remain lackluster, SCMR signals are red, the TD count is freshly bearish, market structure is still favoring the bears, and the volume indications are slowly deteriorating once again so we’ll wait for the $29k level or slightly below to activate the small ST trade idea below.
Short-term Trade Idea: Buy weakness between $28.5k -$29k for shorter-term upside to $34k.
TradingView Bitstamp BTC/USD daily linear chart
We’ll also look at the daily chart for the medium-term technical setup where we can see that price is still finding support at the SCMR support dots on neutral SCMR signals and mixed candle formations while market structure is still bearish overall, all reasons to keep sizing very small on the ST trade idea above. The falling moving averages, lackluster momentum oscillators, still slightly bearish volume indications, and the orange pivot from earlier in the week also suggest that a breakdown to new local lows is becoming increasingly likely over the coming days, hence our caution despite a good short-term risk/reward opportunity just below the current price.
Long-term Trade Idea: Stay neutral until further notice.
Monero (XMR) Technical Analysis & Outlook
TradingView Binance XMR/BTC daily linear chart
XMR/BTC continues to react favorably despite the broader concerns surrounding the crypto space, especially today where we see a nice dragonfly-style doji within what very well could be a Cup & Handle continuation pattern while all of the moving averages continue to rise and the volume indications show improvement, all quite bullish signs moving forward. On the other hand, the momentum oscillators could use a recharge and there is still the possibility of a bull trap around current levels therefore we’ll stay patient for either lower levels or a breakout to new regional highs to get active on the long side once again.
Trade Idea: Buy weakness below 0.0055 for medium-term upside to the 0.0077 area. Longer-term target still resides around 0.0100.
TradingView Bitfinex XMR/USD daily linear chart
XMR/USD is still treading water just below the key $200 level and around the slowly falling moving averages on neutral SCMR signals, mixed candle formations, and highly uncertain market structure overall, so more consolidation with a slight downward bias seems likely (at least over the shorter-term). The lackluster momentum oscillators also suggest more choppy action below $200 for the time being, however the volume indications continue to improve and SCMR support continues to build below the market so we’ll watch closely for signs of higher prices over the coming days.
Trade Idea: Hold current positions for shorter-term upside to the $220 area.
Ethereum (ETH) Technical Analysis & Outlook
TradingView Binance ETH/BTC 3-day linear chart
ETH/BTC continues to underperform many other major alts with price breaking below the key 0.060 level this week on bearish candle formations, red SCMR signals, and confirmed bearish short and medium-term market structure all while the 100 SMA rolls over to join the 50 SMA in a downtrend, all bad news for the bulls moving forward. The fact that RSI and Willy still aren’t fully recharged while the volume indications continue to fall off a cliff is also suggesting more bearish action ahead, although we do have a 3-day TD 9 printing now as price gets very close to the intermediate-term demand area and the still rising 200 SMA, so we’re expecting a positive reaction from the bulls in that 0.055 region which is where we’ll get interested on the long side again (even if only for a countertrend scalp).
Trade Idea: Buy weakness between 0.055 – 0.058 with a shorter-term target of 0.065.
TradingView Coinbase ETH/USD daily linear chart
ETH/USD still looks pretty heavy from a technical perspective considering that the early week rally simply put in another lower high therefore confirming bearish market structure, and now price is heading back down on bearish SCMR signals and a newly bearish TD count while SCMR resistance continues to build overhead, none of which bodes well for the bulls moving forward. The very discouraging volume indications and the lackluster volume indications are also favoring the bears heading into the weekend, so we’ll continue to hold off on any official long trade ideas until the market shows real signs of bottoming.
Trade Idea: Stay neutral until further notice.
Dero (DERO) Technical Analysis & Outlook
TradingView Kucoin DERO/BTC daily linear chart
DERO/BTC is starting to show some signs of life finally following a small double bottom in the 0.00017 area over the past few weeks, and earlier this week we had a breakout to new local highs on a blue SCMR reversal signal that is being followed up by slowly rising neutral SCMR signals, none of which are very convincing but do shows signs of promise moving forward. The still bullish TD count (5) and still favorable momentum oscillators should also help the bulls a bit moving forward, although the volume indications remain a concern and the moving averages are all falling so we’re staying cautious until further notice.
Trade Idea: Hold current positions for medium-term upside to the 0.00025 area.
TradingView Kucoin DERO/USDT daily linear chart
DERO/USDT continues to languish in and around the top of the longer-term demand area on a hodgepodge of candle formations, mixed SCMR signals, a mixed and unhelpful TD count, and still bearish market structure overall, suggesting more choppy consolidation in the $5 – $6 range moving forward. The still lackluster momentum and volume indications also point to a challenging trading environment for the foreseeable future, although the longer the bulls can defend the $5 lows the better the odds become that a sustainable bottom is forming in this region.
Trade Idea: Hold current positions for medium-term upside to the $9 area.
Good Luck, Good Trading!