Crypto Market Commentary & Outlook
(December 19 – 2022)
Bitcoin (BTC) Technical Analysis & Outlook
The bitcoin and crypto markets remain under expected selling pressure coming into this low liquidity holiday week and conditions are likely to get even more dangerous heading into the weekend as volumes dry up and the technicals signal lower prices. The lack of newsflow over the next few weeks will also add to the liquidity vacuum thus exacerbating price movements in both directions making trading conditions treacherous. While we continue to project both a price and time bottom in the markets over the next two to four weeks, the shorter-term outlook is much more uncertain therefore we think staying neutral and preserving capital through Christmas is likely the prudent move.
TradingView Bitstamp BTC/USD daily linear chart
First, let’s look at the daily chart for a view of the intermediate-term setup where we can see that price is breaking down to new local lows today on a red SCMR signal and red TD (4) count while new SCMR resistance begins to build overhead, none of which bodes well for the bulls over the shorter-term. The fact that all of the moving averages are falling while the momentum and volume indications take a turn for the worse is also bad news for the bulls moving forward into the holidays, therefore we think it best to cancel the previous long trade despite the OTE long zone and move to the sidelines for at least the next week (post-Christmas).
Short-term Trade Idea: Stay neutral until further notice.
TradingView Bitstamp BTC/USD weekly linear chart
We’ll also look at the weekly chart to see where the longer-term technicals stand heading into year-end and for now the chart hasn’t changed much since the beginning of the month considering that candle formations remain small but slightly bearish, SCMR signals are still red, and the TD count remains green, so the mixed signals dominate as uncertainty rules for now (hence more short-term chop is likely). Having said that, the shorter-term moving averages are falling, market structure is still bearish, and the momentum and volume indications leave something to be desired, so the bias is generally to the downside going into the low liquidity holidays (despite the possibility of random liquidity spikes to the upside this week).
Long-term Trade Idea: Accumulate below $16k for longer-term targets in the $100k range.
Monero (XMR) Technical Analysis & Outlook
TradingView Poloniex XMR/BTC weekly linear chart
XMR/BTC continues to recover from its dump last week thus keeping SCMR signals bright green and the TD count green as well (7) while intermediate-term market structure remains favorable for the bulls, therefore we now think there could be slightly more upside over the short-term before correcting harder in a week or two. The still rising 50 and 100 SMAs, active SCMR support below the market, and encouraging volume indications also suggest that a 0.0090 handle is becoming more likely before a bigger drop, therefore we’ll likely have to wait a little longer to hit our buy targets lower.
Trade Idea: Accumulate below 0.0080 for a short-term target of 0.0090 and an intermediate-term target of 0.0105.
TradingView Bitfinex XMR/USD daily linear chart
XMR/USD continues its slow correction off of the $153 local highs to start this week with TD signals still red (6), SCMR signals neutral, and mixed to slightly bearish moving averages, all suggesting more choppy price action this week with a minor downward bias overall. The momentum oscillators also suggest lower prices over the shorter-term with downside buy targets still being between $125 – $135, however the volume indications show buyers in charge so we need to watch for a shallower dip in case the bulls get impatient.
Trade Idea: Accumulate below $135 with a longer-term target of $1000.
Ethereum (ETH) Technical Analysis & Outlook
TradingView Bittrex ETH/BTC weekly linear chart
ETH/BTC is moving to the downside as expected to start the week thus flipping the weekly TD count back to red on a small doji candle with a red SCMR box overhead indicating a bearish bias while the momentum oscillators continue to slowly recharge, all pointing lower prices over the coming days/week. That said, the volume indications remain very encouraging for the bulls and support is quite strong in the 0.068 region which is where we’ll nibble some longs at least for a countertrend bounce (as well as longer-term accumulation).
Trade Idea: Accumulate around and below 0.068 for longer-term upside to the 0.100 area.
TradingView Coinbase ETH/USD daily linear chart
ETH/USD is looking quite heavy heading into this pre-holiday week with price moving lower today on a red SCMR signal, bearish doji candle, and red TD count (4) while the shorter-term moving averages accelerate to the downside and the 200 SMA continues to trend lower, all bad news for the bulls moving forward. Active SCMR resistance overhead, still recharging momentum oscillators, and discouraging volume indications also point to a bearish bias over the next few weeks, hence we’re moving our buy target slightly lower to accommodate for a possible low liquidity holiday dump.
Trade Idea: Buy weakness below $1050 for longer-term upside to the $10k area.
Dero (DERO) Technical Analysis & Outlook
TradingView Kucoin DERO/BTC weekly linear chart
DERO/BTC has found some support just above the 0.00020 level over the past several days which is where the 50 and 100 SMAs are currently meeting on the weekly chart above, although we think this stability is short-lived considering that the TD count is still firmly red (3), SCMR resistance is building just overhead, the momentum oscillators are still recharging, and the volume indications remain atrocious. The lack of significant support until at least the 0.00018 area is also not great for the bulls moving forward during this holiday season, however strong support does exist around and above 0.00015 into the 0.00017 region which is where we’ll be buying for a bounce as well as for long-term holding.
Trade Idea: Accumulate around and below 0.00018 for longer-term upside to the 0.00100 area.
TradingView Kucoin DERO/USDT weekly linear chart
DERO/USD looks pretty ugly as we head into year-end given still small but red SCMR signals, active SCMR dots overhead, a red TD count (6), and a falling 50 SMA, therefore we’re expecting lower prices over the next few weeks. The very discouraging momentum and volume indications aren’t helping matters for the bulls either as liquidity begins to dry up over the coming days, so we’re staying patient for lower levels before getting active on the long side again.
Trade Idea: Accumulate around and below $3.30 for intermediate-term upside to the $10 area. Longer-term target remains around $100.
Good Luck, Good Trading!