Crypto Market Commentary & Outlook
(October 21 – 2022)
Bitcoin (BTC) Technical Analysis & Outlook
With the bitcoin market still pinned around the $19k level heading into the weekend, it doesn’t come as much of a surprise that BTC volatility has fallen below that of both the S&P 500 and the Nasdaq, a very rare occasion that is typically a sign of impending large prices moves in the not too distant future. While we maintain our bearish bias into the 60-day cycle low in a little over two weeks, we also remain steadfastly prepared to buy the panic to new lows should the opportunity present itself. Until then, we’ll stay neutral while the market chops around in a poor risk/reward area.
TradingView Bitstamp BTC/USD daily linear chart
First let’s take a look at the daily chart for a view of the intermediate-term technicals where we can see that price remains below the descending triangle downtrend line and the falling 50 SMA while strong SCMR resistance continues to build overhead and market structure remains bearish overall, not great news for the bulls heading into the end of the month. The fresh red TD count (2), the falling longer-term moving averages, and the lackluster momentum and volume indications also suggest a challenging environment for the bulls over the next few weeks, therefore we’re keeping our powder dry for lower levels in case of a breakdown below the bearish triangle.
Short-term Trade Idea: Stay neutral until further notice.
TradingView Bitstamp BTC/USD weekly linear chart
Next, we’ll see where things stand in regard to the longer-term technicals and not much has changed on the weekly chart over the past few weeks as price remains well within the broader consolidation channel and is still compressing below the midline and below SCMR resistance, all pointing to lower prices before a sustainable rally. Red SCMR signals, a rapidly falling 50 SMA, and bearish momentum and volume indications are also signs that caution remains warranted for the bulls moving forward, although the green TD (1) signal does hint that we are close to a bottom timing-wise which is why we are ready to buy blood at a moments notice.
Long-term Trade Idea: Accumulate below $18k for longer-term targets in the $100k range.
Monero (XMR) Technical Analysis & Outlook
TradingView Binance XMR/BTC daily linear chart
XMR/BTC continues to chop around in the mid-0.0070’s on a hodgepodge of candle formations and highly mixed XMR signals while the TD count is in no man’s land, all suggesting more of the same over the near-term, however active SCMR resistance dots overhead, deteriorating volume indications, lackluster momentum oscillators, and a now bearish weekly candle suggest that some downside is likely in the not too distant future. While the confluence around the 0.0070 level is still attractive for shorter-term scalping, we think the bulk of our dry powder should be saved for lower levels in case of a weekly pennant breakdown to the longer-term support zone just below 0.0060 (see weekly chart from the previous CMU).
Trade Idea: Accumulate below 0.0060 for a longer-term target around 0.0100.
TradingView Bitfinex XMR/USD daily linear chart
While XMR/USD continues to trade above the $140 level heading into the weekend, the technicals continue to point to a move lower sooner rather than later considering that SCMR signals are back to red, the TD count is newly bearish (2), market structure is slowly deteriorating, and price remains below all the relevant moving averages. The fact that the A/D line is breaking down while the momentum oscillators still have room to recharge also suggests a move lower soon, likely to the low to mid-$120’s before the bulls step back up to the plate.
Trade Idea: Accumulate below $125 with a longer-term target of $1000.
Ethereum (ETH) Technical Analysis & Outlook
TradingView Binance ETH/BTC weekly linear chart
ETH/BTC continues to grind sideways in the high-0.060’s on neutral SCMR signals, indecisive candle formations, and uncertain market structure, all of which is helping keep price where it is for the time being, however the red TD count (6) suggests a few more weeks of selling pressure and the momentum oscillators could use some more recharging therefore we continue to lean towards lower prices before a sustainable low is established. Having said that, strong volume indications, rising longer-term moving averages, and multiple zones of significant support below the market have us thinking that downside is relatively limited and that we should be buying the dips when/if given the chance.
Trade Idea: Accumulate below 0.062 for longer-term upside to the 0.100 area.
TradingView Coinbase ETH/USD daily linear chart
ETH/USD is still stuck around the $1300 level on technicals that are highly mixed and indecisive by almost any metric, which suggests more choppy consolidation around these levels over the shorter-term, as do the neutral momentum and volume indications. That said, deteriorating market structure, falling longer-term moving averages, and active SCMR resistance dots overhead all point to lower prices over the coming weeks before we see stabilization and recovery closer to year-end, so we’ll stay patient for $1100 or below before getting active on the long side.
Trade Idea: Accumulate below $1100 for longer-term upside to the $10k area.
Wownero (WOW) Technical Analysis & Outlook
Coinigy TradeOgre WOW/BTC 3-day linear chart
It’s been a while since we took a serious look at WOW/BTC due to the fact that it has been practically lifeless over the course of this year, however with potential cycle lows approaching for crypto at large and a very nice rounded bottom forming around the 200 sats area, we think it’s time to pay attention once again. A rising OBV, trending RSI, and improving long-term market structure are all telling us to continue buying around and below 0.00000200, while the recent move above the shorter-term moving averages is also a sign of renewed strength/optimism. While we think that patience is still necessary to play this one given consolidation could last months longer, we think accumulating near these cycle lows will be rewarded over the next few years.
Trade Idea: Accumulate around and below 0.00000200 for upside to the 0.00001000 area.
Good Luck, Good Trading!