Crypto Market Commentary & Outlook
(January 29 – 2021)
Bitcoin (BTC) Technical Analysis & Outlook
It’s been a wild 24 hours in the bitcoin markets with price rising all the way up into the $38,000’s earlier today, a move that started yesterday on the back of news that Ray Dalio of Bridgewater is considering adding BTC to new funds. Then the big rally came this morning following a change in Elon Musk’s twitter profile to simply “#bitcoin” and a tweet saying “in retrospect, this was inevitable”. While the gains were fairly short lived due to a lack of technical support for a sustainable move back up to the all-time highs, we do think these developments are very bullish longer-term.
TradingView Bitstamp BTC/USD 6-hour linear chart
We’ll begin this final update of the week with another look at the 6-hour chart for a view of where we stand with regard to the falling wedge pattern and we can see that the move higher today broke the formation to the upside on a large bullish candle formation that turned shorter-term market structure more favorable, certainly good news for the bulls heading into the weekend. We also like the fact that price is already retracing to test the broken trendline which is holding as support so far, although we would not be surprised to see the market stay around current levels over the near-term due to the lackluster momentum indications and a worrisome A/D line.
TradingView Bitstamp BTC/USD weekly linear chart
We’ll also zoom out to the weekly chart for a view of the longer-term technicals before the weekend and we can see that the supply area overhead once again acted as resistance on the spike higher earlier today thus sparking a long-legged doji-type candle formation that suggests more consolidation in the $30k’s over the short to medium-term before a resumption of the bull market. The still overbought momentum oscillators also point to a directionally challenged market over the shorter-term, however the accelerating moving averages and the still favorable volume indications are telling us to keep buying dips below $30k for eventual upside well above $40,000.
Trade Idea: Buy dips below $30,000 for longer-term upside to the $46,000 area.
Monero (XMR) Technical Analysis & Outlook
TradingView Poloniex XMR/BTC weekly linear chart
Despite positive news regarding a possible Grayscale Monero Trust over the past few days, XMR/BTC continues to consolidate around the 0.0040 level on small but discouraging weekly candle formations while longer-term market structure remains firmly bearish, none of which bodes well for the bulls over the coming days. The falling moving averages and still not fully recharged momentum oscillators are also fairly bad signs for the bulls moving forward, although we still think that accumulating below 0.0040 is a good play for the longer-term (especially if the Grayscale news comes to fruition).
Trade Idea: Accumulate below 0.0040 for longer-term upside to 0.0100.
TradingView Bitfinex XMR/USD weekly linear chart
XMR/USD has rebounded back to the $140 area today on BTC strength thus sparking a textbook weekly doji candle while shorter-term market structure remains uncertain and the momentum oscillators are still fairly stretched to the upside, so more consolidation in the low to mid-$100’s appear likely moving forward. That said, the upper demand area is still acting as support, the volume indications remain encouraging overall, and the momentum oscillators are still picking up steam to the upside so longer-term we remain bullish (hence we want to keep buying dips).
Trade Idea: Buy dips below $130 for longer-term upside to $200.
Bitcoin SV (BSV) Technical Analysis & Outlook
TradingView Huobi BSV/BTC daily linear chart
BSV/BTC got pretty close to the long-term downtrend line that we have been watching for months now, but once again price is pulling back on some discouraging candle formations that are turning already bearish market structure heavier while all of the moving averages continue to move to the downside, all pointing to lower prices over the near-term. The still bearish momentum and volume indications are also suggesting that the bears are still in control of this market which is why we’ll stay on the sidelines until a break of the trendline materializes.
Trade Idea: Stay neutral until further notice.
TradingView OKex BSV/USDT weekly linear chart
BSV/USDT has fallen back down below the 50 SMA over the past few weeks on some bearish candle formations that are keeping market structure highly uncertain overall, however the 100 SMA is still rising and is providing support so more consolidation in the ~$150 – $200 region seems likely over shorter-term. The stagnant and not yet recharged momentum oscillators and the deteriorating volume indications are also telling us that sideways (if not down) is the path of least resistance for now so we’ll stay neutral until further notice.
Trade Idea: Stay neutral until further notice.
Uniswap (UNI) Technical Analysis & Outlook
TradingView Binance UNI/BTC daily linear chart
Given the rise in many DeFi coins over the past several weeks, we’ll begin to cover those on our watchlist more regularly and we’ll start off with UNI where we can see on the BTC pair that price has moved all the way up to the lower supply area over the course of this week thus confirming bullish medium-term market structure while the volume indications slowly improve, all good signs for the bulls from a longer-term perspective. The recent bullish crossover of the shorter-term moving averages, which are rising, is also very good for the bulls moving forward, however the volatility over the past few days combined with overbought momentum is likely to keep price consolidating over the shorter-term.
Trade Idea: Buy dips below 0.00040 for longer-term upside to 0.00080.
TradingView Binance UNI/USDT daily linear chart
UNI/USDT has moved up to new all-time highs above $15 over the past few days thus confirming a shift to bullish longer-term market structure while the moving averages continue to pick up steam to the upside and the volume indications remain very favorable overall, very good news for the bulls as 2021 progresses. That said, price action is getting a bit choppy right now and momentum is very overbought so we think there could be some consolidation on either side of this key $15 level before another leg up materializes to new highs at one of the Fibonacci extension levels shown above.
Trade Idea: Buy dips below $14 for upside to the $21 area.
Good Luck, Good Trading!