Crypto Market Commentary & Outlook

(February 23 – 2021)

Bitcoin (BTC) Technical Analysis & Outlook

Despite the bitcoin markets reaching new local and regional lows earlier today price action and the technicals continue to suggest that this is simply a correction/consolidation in a still intact bull market, something that we think is actually a healthy development given the pace and magnitude of the recent rally to $58k. In fact, news that Square has bought another $170 million worth of bitcoin while Cash App crypto users continue to grow actually supports the idea of a continuation of the bull market down the road, although at this time we cannot rule out more downside before a sustainable regional low is established.

TradingView Bitstamp BTC/USD 4-hour linear chart

We’ll start off with a look at the 4-hour chart for a closer view of the shorter-term technicals where we can see that price is consolidating just above the top of the upper demand area and the 61.8% Fibonacci retracement level on a hodgepodge of rather large candle formations that are keeping near-term market structure fairly bearish, not great news for the bulls for the remainder of the week. The break of the 100 SMA over the past few days and the first hiccup in the A/D line in a while also suggests that the environment is likely to stay challenging for the bulls over the shorter-term, although the almost oversold momentum oscillators and the still rising 200 SMA are telling us that buyers are likely to reemerge in the upper OTE long zone between the blue 61.8% and 78.6% levels (which is where we’ll get active on the long side once again as well). That said, we cannot rule out a final move down into the lower OTE long zone starting at $40k so we’ll save some dry powder in case the bears really get active later this week.

TradingView Bitstamp BTC/USD daily linear chart

Next we’ll look at the daily chart for a view of the medium-term setup where we can see that price has pushed down to new lows today on another large and fairly bearish candle formation that is turning market structure more worrisome over the near-term while the momentum oscillators just begin to recharge, none of which bodes well for the bulls moving forward. On the other hand, the moving averages continue to steadily rise, the A/D line shows this dip being bought, and there is historical support above $40k which is why we will start to accumulate again below $42k if given the opportunity.

Trade Idea: Buy dips below $42,000 for upside to the $65,000 area. 

Monero (XMR) Technical Analysis & Outlook

XMR/BTC

TradingView Binance XMR/BTC daily linear chart

XMR/BTC is rallying today off of the recent lows and is now back above the longer-term moving averages on a bullish candle formation that is helping shorter-term market structure due to the higher low that is forming, all quite good news for the bulls over the near-term. The improving volume indications, the reversing momentum oscillators, and the lack of resistance until the 0.0050 area are also pointing to a slight bullish bias moving forward, although we’ll lower our initial price target given the still uncertain medium-term outlook.

Trade Idea: Accumulate below 0.0045 for upside to 0.0055. Longer-term targets remain around 0.010.

XMR/USD

TradingView Bitfinex XMR/USD daily linear chart 

XMR/USD has seen a nice bounce back to the upside following a washout down to new lows earlier today as price found support at the still rising 50 SMA thus sparking a fairy bullish candle formation while the A/D line ramps to the upside, so it’s pretty clear that this dip is being bought. The fact that the longer-term moving averages are also still rising while the momentum oscillators recharge fairly quickly is also suggesting that is is simply a pause that refreshes rather than the end of the intermediate-term trend, therefore we want to continue buying below $250 (and certainly $200) for longer-term upside well above $300.

Trade Idea: Accumulate below $250 for upside to $325.

Bitcoin SV (BSV) Technical Analysis & Outlook

BSV/BTC

TradingView Huobi BSV/BTC daily linear chart

The recent performance by the BSV/BTC bulls following the break of the longer-term trendline has been quite disappointing as price has sunk back down and is riding the broken trendline lower, spiking below it a few days ago on what are still fairly discouraging candle formations, not great signs for the bulls moving forward. The still falling moving averages, the not yet fully recharged momentum oscillators, and the still bearish state of market structure are also very concerning signals for the bulls, therefore we want to move back to neutral until we get evidence that they are serious about stopping this downtrend.

Trade Idea: Stay neutral until further notice.

BSV/USD

TradingView Huobi BSV/USDT daily linear chart 

BSV/USDT has sunk back down towards the bottom of the trading range over the past few days on some large and fairly bearish candle formations that are keeping market structure highly uncertain while the momentum and volume indications remain lackluster, so we don’t expect a move out of this longer-term consolidation area anytime soon. That said, the moving averages are providing some near-term support and recent wicks to the downside show that buyers are a bit more interested in buying below $180 so we’re thinking a move back towards $200 is likely in the not too distant future.

Trade Idea: Buy dips below $180 for upside to the $250 area.

Decred (DCR) Technical Analysis & Outlook

DCR/BTC

TradingView Binance DCR/BTC 3-day linear chart

We also want to take a look at DCR/BTC as price has finally reached the 0.0030 level as expected and is now experiencing some turbulence at historical resistance on very overbought momentum oscillators and still suspect longer-term market structure, so we think this is a good time to take some profits (at least on shorter-term positions). Having said that, the slowly improving A/D line, the rising shorter-term moving averages, and favorable shorter-term market structure all support the idea of this being a healthy correction/consolidation coming up so we’ll be ready to buy if price dips below 0.0020.

Trade Idea: Buy dips below 0.0020 for longer-term upside to the 0.0050 area.

DCR/USD

TradingView Binance DCR/USD 3-day linear chart 

DCR/USD once again hit new highs this week on a very large candle formation that has confirmed bullish longer-term market structure while the moving averages continue to rise, so the bulls aren’t totally out of ammo yet. The fact that the A/D line is still pretty favorable is also a decent sign for the bulls longer-term, however momentum is very overbought and the current candle formation is turning more bearish so a test of lower levels seems likely before yet another run at all-time highs.

Trade Idea: Buy dips below $120 for longer-term upside to the $200 area.

Good Luck, Good Trading!