Crypto Market Commentary & Outlook
(February 24 – 2021)
Bitcoin (BTC) Technical Analysis & Outlook
The bitcoin markets briefly recovered back above the $50,000 level this morning following news earlier today that Michael Saylor and MicroStrategy finished buying another 19,452 BTC at an average price of $52.765. While this is no doubt good news for the bulls longer-term, it also means that some of the recent buying pressure is likely to subside over the near-term meaning that our call for more consolidation below $58k is still firmly intact moving forward. That said, we also still think that the bull market remains in full swing longer-term so we’ll continue to use this period of weakness as an opportunity to add to holdings.
TradingView Bitstamp BTC/USD 6-hour linear chart
Let’s zoom out to the 6-hour chart today for a slightly broader view of the short-term technicals where we can see that price reversed just below the bottom of the upper demand area and right around the adjusted 61.8% Fibonacci retracement level yesterday and has since bounced back up to the 50 SMA over the past 24 hours, a sign that we’re likely in a consolidation rather than a distribution. The almost recharged momentum oscillators should also help the bulls in case the bears get active again this week, although the aforementioned 50 SMA is acting as near-term resistance which is keeping market structure bearish for the time being and the volume indications are beginning to stagnate so we think the market stays between ~$45k – $52k for the foreseeable future.
TradingView Bitstamp BTC/USD 3-day linear chart
We’ll also look at the 3-day chart for a view of the medium-term setup where we can see that the recent top ended up materializing in between the 223.6% and 238.2% Fibonacci extension levels where a large bearish candle formation developed and ultimately printed yesterday on still fairly extended momentum oscillators and concerning near-term market structure, all suggesting that we need to stay cautious over the coming days. The lack of historical or technical support below the market is also something that we need to be wary of, however the still rising moving averages and favorable volume indications are telling us to keep buying dips into key support levels moving forward.
Trade Idea: Buy dips below $45,000 for upside to the $65,000 area.
Monero (XMR) Technical Analysis & Outlook
TradingView Binance XMR/BTC daily linear chart
Despite continued volatility in the XMR/BTC market, buyers are still getting active in the longer-term demand area while the 50 SMA reverses to the upside as price breaks back above it, which is good news for the bulls longer-term. On the other hand, market structure remains highly uncertain, the momentum and volume indications remain lackluster, the longer-term moving averages are still falling, and resistance remains stiff above 0.0050 so that’s where we think price is capped as this accumulation/consolidation continues over the coming days (and perhaps weeks).
Trade Idea: Accumulate below 0.0042 for upside to 0.0050. Longer-term targets remain around 0.010.
TradingView Bitfinex XMR/USD daily linear chart
XMR/USD has managed to stay above $200 over the past 24 hours which is a victory for the bulls given the magnitude of the selloff earlier this week, and the still rising moving averages and encouraging volume indications tell us that they are still in good shape from a longer-term perspective. That said, the short-term outlook remains concerning seeing as though the momentum oscillators are not yet fully recharged and there isn’t much in the way of near-term historical support so we think another test of sub-$200 prices is likely in the near future (a move that we would be buyers of).
Trade Idea: Accumulate below $200 for upside to $325.
Aeon (AEON) Technical Analysis & Outlook
TradingView Bittrex AEON/BTC 3-day linear chart
Last week AEON/BTC broke above the long-term downtrend line on a firmly bullish candle formation and improving market structure, which comes as no surprise given our previous forecast, although a gravestone doji at the recent top and the subsequent selloff this week have taken price back down to the broken trendline which is a bit worrisome for the bulls considering what has happened to BSV over the past several days. The still falling moving averages and lackluster momentum and volume indications are also making us worried that this was a false breakout, so we’ll wait for another set of encouraging technicals to emerge before getting bullish on this one once again.
Trade Idea: Buy dips below 0.00000700 for upside to 0.00002000.
TradingView Bittrex AEON/USD 3-day linear chart
AEON/USD remains right in the middle of the current medium-term trading range between supply and demand areas and around the still stagnant moving averages on a mixed candle formation and still highly uncertain market structure, so more rangy consolidation appears likely for the foreseeable future. The fact that the A/D line has already reversed to the downside while the momentum oscillators move back into no man’s land confirms that the market is likely to stay directionally challenged for a while so we’ll stay neutral until further notice.
Trade Idea: Stay neutral until further notice.
Aave (AAVE) Technical Analysis & Outlook
TradingView Binance AAVE/BTC 3-day linear chart
We’ll wrap up with a look at one of our DeFi picks, AAVE, which looks very interesting on the BTC pair above where we can see that price perfectly tagged the 200% Fibonacci extension level early this month but has since been in a steady downtrend that has taken price all the way to the previous high thus turning shorter-term market structure fairly bearish, so there’s certainly reasons to stay cautious right now. The still not yet fully recharged momentum oscillators and the stagnant volume indications are also not great signs for the bulls moving forward, however the bounce out of the OTE long zone a few days ago sparked a bullish hammer candle that suggests we are close to ending this consolidation period so we’ll continue to buy below 0.0070 if given the opportunity.
Trade Idea: Buy dips below 0.0070 for longer-term upside to the 0.0180 area.
TradingView Binance AAVE/USDT daily linear chart
AAVE/USD has been in a choppy downtrend for most of February, a move that was recently capped off with a large spike below the $300 level that briefly pierced the still rising 50 SMA while momentum has continued to move lower, all of which tells us to stay cautious over the near-term. Conversely, said momentum oscillators are getting close to oversold territory, the volume indications remain steady, the 100 SMA continues to move higher, longer-term market structure remains intact, and the candle formation that printed yesterday is pretty bullish overall (and came out of the upper demand zone), so we’ll be buyers of sub-$325 prices moving forward.
Trade Idea: Buy dips below $325 for upside to the $500 area.
Good Luck, Good Trading!