Crypto Market Commentary & Outlook

(May 5 – 2021)

Bitcoin (BTC) Technical Analysis & Outlook

The manic price action that we’ve seen for the past few weeks in the bitcoin markets continues into today as price pushed back above the $57k level on news that NYDIG has partnered with hundreds of US banks to bring crypto to regular banking customers, a positive longer-term development for the bulls to be sure. The rally has also helped the technicals a bit, especially on the daily timeframe, although we still think that all of this choppy action is part of a broader consolidation that is likely to persist for at least another week or two.

TradingView Bitstamp BTC/USD daily linear chart

First we want to take another look at the daily chart where we can see that price has bounced all the way from the top of the upper demand area up to the bottom of the OTE short zone around $58k, and now price is trying to stay above the flatlined 50 SMA heading into the daily close which would keep the current candle formation bullish and could easily spark a continuation up into the $60k area over the next few days. The rising longer-term moving averages, the favorable momentum oscillators, and the still encouraging volume indications also suggest a slight upward bias going into week’s end, however we still think the most likely shorter-term path forward for the market is a continuation of the current consolidation between ~$50k – $60k.

TradingView Bitstamp BTC/USD weekly linear chart

We’ll also zoom out to the weekly chart for a view of the longer-term technicals where we can see that price is now back in the middle of the channel/flag pattern on an increasingly bullish candle formation that is helping shorter-term market structure while all of the moving averages continue to rise to catch up to price, so the bulls still have the advantage from a medium to long-term perspective. The volume indications also support the idea of the bull market not being close to over at this point, however momentum is still overbought and near-term action remains a mess overall so we’re staying fairly neutral at least until a convincing close above $60k materializes (which we think could easily be another week or two).

Trade Idea: Buy dips below $52,000 for longer-term upside to the $73,000 area.

Monero (XMR) Technical Analysis & Outlook

XMR/BTC

TradingView Binance XMR/BTC daily linear chart

XMR/BTC is still trying to establish a higher low in the 0.0070 area and for the time being it’s starting to look like a rounded bottom is forming right where the handle of a Cup & Handle continuation pattern would form which implies that the start of a move higher is not far off that likely leads to new regional highs above 0.0080 this time around. The fact that the shorter-term moving averages continue to pick up steam to the upside while the momentum oscillators recharge and the volume indications remain steady is also a sign that the bulls are simply regaining strength before trying to break from this area, although given XMR’s recent history we need to stay patient as its likely to take a bit more consolidation than anticipated before the bulls are ready for the upcoming battle with the bears.

Trade Idea: Accumulate below 0.0070 for upside to 0.0100. Longer-term target remains in the 0.0200 area.

XMR/USD

TradingView Bitfinex XMR/USD weekly linear chart 

XMR/USD is once again back above the $400 level today thus turing the weekly doji candle that has formed more bullish which in turn is keeping market structure firmly intact, good news for the bulls to be sure, and we like that the moving averages are still accelerating to the upside while the volume indications remain steady. What we don’t like are the momentum oscillators hitting officially overbought territory while price hits serious supply area resistance overhead so we want to stay cautious over the shorter-term as more turbulence is likely in this region.

Trade Idea: Accumulate below $400 for upside to the $600 area. Longer-term target has been adjusted up to the $800 area.

Bitcoin Cash (BCH) Technical Analysis & Outlook

BCH/BTC

TradingView Binance BCH/BTC 3-day linear chart

BCH/BTC has absolutely exploded to the upside today moving up 30+% on a large and firmly bullish candle formation that has confirmed a shift to bullish medium-term market structure while the 50 SMA starts to pick up steam to the upside for the first time in its existence, all very good news for the bulls moving forward. The fact that the momentum oscillators still have room to run higher while the volume indications improve is also very good for the bulls overall, however OTE short zone and supply area resistance both reside around this 0.024 level so a pause/pullback to the 0.020 area before another leg up would not surprise us one bit.

Trade Idea: Buy dips below 0.020 for upside to the 0.045 area.

BCH/USD

TradingView Coinbase BCH/USD daily linear chart 

BCH/BTC has broken out of the triangle/pennant in convincing fashion this week pushing all the way up into the OTE short zone in the $1300’s on a very large and firmly bullish candle formation that has confirmed a shift to to bullish longer-term market structure while the moving averages slowly accelerate to the upside, all of which bodes very well for the bulls longer-term. The encouraging volume indications also suggest an upward bias moving forward, however momentum is getting close to overbought right when price is hitting serious resistance so some backing and filling between ~$1100 – $1400 appears likely before another sustainable leg to the upside materializes.

Trade Idea: Buy dips below $1200 for upside to the $2800 area. 

Decred (DCR) Technical Analysis & Outlook

DCR/BTC

TradingView Binance DCR/BTC daily linear chart

The last time we looked at DCR/BTC it was consolidating just above the broken triangle/pennant and we were expecting a breakout to the upside, and that is exactly what happened in the middle of last month which is certainly good news for the bulls longer-term, although the move came on some serious bearish momentum and volume divergences so the recent weakness comes as no surprise. Actually, while we still think that the path of least resistance is generally higher longer-term, we also think that the support confluence in the 0.0030 area is likely to be tested before another leg up so we’ll stay patient for lower levels over the shorter-term.

Trade Idea: Buy dips below 0.0030 for upside to the 0.0050 area.

DCR/USD

TradingView Binance DCR/USD 3-day linear chart 

After hitting a new all-time higher around the 500% Fibonacci extension level last month price has since been consolidating within what appears to be a triangle/pennant that is approaching its apex on very mixed candle formations and uncertain shorter-term market structure, so we think more of the same is likely over the near-term. That said, the momentum oscillators are getting closer to recharged, the volume indications remain highly encouraging, and the moving averages continue to rise so we think an upside breakout materializes before the 20th of May (where the triangle terminates).

Trade Idea: Buy dips below $180 for upside to the $300 area.

Good Luck, Good Trading!