Crypto Market Commentary & Outlook
(February 3 – 2021)
Bitcoin (BTC) Technical Analysis & Outlook
On a slow day in the legacy markets with little in the way of headline news regarding bitcoin or crypto other than an announcement by Visa, we’re pleasantly surprised that price is already approaching the $38,000’s, an area that was mentioned in yesterday’s update. Price action also remains favorable at this time which is being supported by the still bullish technicals so at this point we see no reason to abandon the call for higher prices into the $38k’s by the weekend. That said, we still need to see $40k get broken to confirm an end to the consolidation so we’re still not ready to get too aggressive at this point.
TradingView Bitstamp BTC/USD daily linear chart
We’ll begin with a look at the daily chart today for another view of the medium-term setup where we can see that price is still moving steadily to the upside on another bullish candle formation that is getting close to the bottom of the all-time high supply area just above $38,000, which is where we think we’ll see a bit of turbulence. That said, there really isn’t anything else on the chart that the bears have to work with given the rising moving averages, favorable momentum and volume indications, and increasingly bullish market structure therefore we’re getting more convinced that the month long consolidation we’ve been in is nearing its end.
TradingView Bitstamp BTC/USD monthly linear chart
We’ll also look at the monthly log chart for a view of where we stand in relation to the previous cycle and we can see that last month’s bearish candle lines up well with the bearish doji from June of 2017, a candle that was followed up the next month with a spike to new regional lows before launching to new highs during the remainder of the year. The overbought momentum oscillators are also a bit concerning over the shorter-term, however the rising moving averages and very encouraging volume indications suggest that any dips below $30k should continue to be bought for longer-term upside well above $42,000.
Trade Idea: Buy dips below $30,000 for upside to the $46,000 area.
Monero (XMR) Technical Analysis & Outlook
TradingView Binance XMR/BTC daily linear chart
It comes as no surprise that XMR/BTC is still consolidating just above the 0.0040 level given our technical outlook from yesterday, and when we zoom back out to the daily chart we see that there is still no reason to believe that a breakout in either direction is likely in the near future. The stagnant momentum and volume indications and uncertain state of shorter-term market structure are also suggesting that more consolidation is likely moving forward, and if there is a move one way or the other it looks like it’s going to be lower (which we would be buyers of).
Trade Idea: Accumulate below 0.0040 for longer-term upside to 0.0100.
TradingView Bitfinex XMR/USD daily linear chart
XMR/USD is looking pretty good from a near-term perspective considering that price has moved above the 50 SMA over the past 24 hours on some encouraging candle formations that are turning market structure fairly bullish again, all good news for the bulls moving forward. The fact that the longer-term moving averages are still moving higher while the momentum oscillators begin to pick up some steam to the upside is also a positive signal for the bulls, hence a run at $170 seems likely before a legitimate pullback materializes.
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
Next we’ll check in on BSV/BTC for a view of where things stand with regard to the long-term downtrend line that the bulls have been contending with for over a year now and so far they have been scared back into submission thus resulting in some bearish candle formations recently that are turning market structure heavy once again. The still falling moving averages and lackluster momentum and volume indications are also helping to keep fear in the bulls’ heads, so we’ll continue to wait until a break above the downtrend line occurs before getting active on the long side in this one.
Trade Idea: Stay neutral until the downtrend line is broken.
TradingView Huobi BSV/USDT daily linear chart
BSV/USDT is looking a bit better today on the back of BTC strength considering that price is now back above all of the moving averages while the momentum oscillators begin to improve and the A/D line stabilizes, so at the very least we think downside is fairly limited. That being said, market structure remains a mess and the volume indications still don’t look great overall so we want to stay neutral until further notice.
Trade Idea: Stay neutral until further notice.
Yearn Finance (YFI) Technical Analysis & Outlook
TradingView Binance YFI/BTC daily linear chart
We’ll wrap up with a look at YFI which despite not moving much on the BTC pair over the past few weeks continues to look good from a longer-term technical perspective considering that market structure is still slowly improving in an area that is ripe for accumulation while the OBV reading continues to rise and the momentum oscillators get closer to recharged, all of which suggests a strong move up in the not too distant future. The move back above the shorter-term moving averages this week is also a good sign, although they are still falling and price action isn’t great yet so more consolidation below 1.00btc is likely at least over next few days (which gives us time to accumulate more).
Trade Idea: Accumulate below 0.90 for longer-term upside to the 3.00 area.
TradingView Binance YFI/USDT daily linear chart
YFI/USDT is looking good for many technicals reasons right now such as the recent improvement in shorter-term market structure as well as the accelerating momentum oscillators which still have plenty of room to run higher before becoming overbought, so we think the path of least resistance is currently still to the upside. The rising moving averages and favorable volume indications are also suggesting a bullish bias heading into the weekend, however the $38k level is likely to attract sellers once again so that is where we’d be taking profits on shorter-term positions.
Trade Idea: Buy dips below $30,000 for medium-term upside to the $44,000 area.
Good Luck, Good Trading!