Crypto Market Commentary & Outlook
(July 1 – 2021)
Bitcoin (BTC) Technical Analysis & Outlook
The bitcoin markets are under pressure to the downside today, which comes as no surprise given our fairly negative take yesterday on the CMU Video due to still very uncertain technicals and a shorter-term fundamental outlook that remains challenged due to Grayscale, China, and regulatory FUD. We can also tell that we’re still in a fairly bearish regime right now considering that announcements from both Steve Cohen’s Point72 and George Soros’ Soros Fund Management that they are getting involved in crypto had no real impact on price action whatsoever. Eventually the good news will start to matter again, which will be a great indicator of a shift to more bullish conditions, however until then we must stay neutral and cautious.
TradingView Bitstamp BTC/USD daily linear chart
First we’ll look at the daily chart for a view of the short t0 medium-term setup where we can see that price has moved down to the top of the upper demand area and into the middle of the descending channel on some bearish candle formations that are turning near-term market structure quite heavy while slightly longer-term structure remains firmly bearish, so we think the bears still have the upper hand for now. The falling shorter-term moving averages and the fact that the 100 SMA is getting close to crossing below the 200 SMA are also bad signs for the bulls over the shorter-term, as are the stagnant momentum oscillators, however the A/D line remains steady and historical support is strong below the market so we’ll remain longer-term nibblers of sub-$32k and heavy buyers in the $27k- $30k region.
TradingView Bitstamp BTC/USD monthly log chart
Given it’s the first day of the new month, and quarter (and half), we want to zoom out to the monthly chart to see where we stand in terms of the technicals and right now things remain highly uncertain from a medium-term perspective considering that a textbook doji candle printed over the past 24 hours while shorter-term market structure remains concerning and the momentum oscillators still have some recharging to do, so we think that more choppy consolidation is likely over this summer with elevated risks to the downside over the shorter-term. Having said that, the longer-term outlook remains more sanguine than most recognize with market structure still being bullish, the moving averages continuing to rise, dynamic support still building at $27k, and volume indications that show buyers being more than willing to soak up supply at these levels so we’ll continue to accumulate on weakness for a resumption of the longer-term uptrend later in the year.
Trade Idea: Accumulate below $32k for upside to the $42k area. Longer-term target resides around $100,000.
Monero (XMR) Technical Analysis & Outlook
TradingView Binance XMR/BTC daily linear chart
XMR/BTC has seen some demand come into the market around the bottom of the symmetrical triangle and top of the OTE long zone over the past few days thus sparking some fairly bullish candle formations recently that are keeping longer-term market structure intact while the momentum and volume indications slowly begin to improve, all good signs for the bulls moving forward. That said, near-term market structure is still a mess, the 50 SMA continues to pick up steam to the downside, and the 200 SMA below the market is now starting to slope downward, so the shorter-term outlook remains concerning hence we’ll wait for sub-0.0060 levels before getting active on the long side again.
Trade Idea: Accumulate below 0.0060 for upside to 0.0070. Longer-term target resides in the 0.0120 area.
TradingView Bitfinex XMR/USD daily linear chart
XMR/USD is heading back down to the $200 area today as expected on a bearish candle formation that is keeping already broken market structure heavy for the time being while the falling 50 SMA gets close to crossing below the 200 SMA (death cross), so the bulls are certainly still on the defensive moving forward. Having said that, the fully recharged and bullishly divergent momentum oscillators, the still encouraging volume indications, and the OTE long zone and upper demand area between ~$150 – $200, which remains attractive for longer-term buys, are also good signs for the bulls so we’ll stick with the plan of buying weakness for that purpose.
Trade Idea: Accumulate below $200 for shorter-term upside to the $250 area. Longer-term target resides around $1000.
Decred (DCR) Technical Analysis & Outlook
TradingView Binance DCR/BTC 3-day linear chart
Next we’ll look at DCR/BTC for the first time in a while where we can see that price continues to react very favorably to the upper demand area and still rising 50 SMA while the longer-term moving averages remain in steady uptrends, plus the volume indications show slow but steady accumulation inside of the developing unorthodox triangle formation, all of which is very good news for the bulls longer-term. The momentum oscillators also look surprisingly good considering the recent choppy environment, although overhead resistance is stiff and shorter-term market structure remains a mess so more consolidation within the pattern appears likely over this summer.
Trade Idea: Accumulate below 0.0035 for medium-term upside to the 0.0065 area. Longer-term target resides around 0.00100.
TradingView Binance DCR/USD 3-day linear chart
The good news for the DCR/USD bulls is that over the past month price has established a double bottom in the upper demand area on what appears to be a tweezer-type formation coming off of the still rising 100 SMA while the other moving averages remain in uptrends as well, not to mention the very encouraging volume indications and the favorable momentum oscillators. The bad news is that price is now butting up against shorter-term downtrend resistance that has resulted in a bearish candle formation while price remains below the 50 SMA, so we need to stay cautious and conservative until both the downtrend line at $150 and the previous regional high at $180 are taken out with conviction.
Trade Idea: Buy dips below $120 for medium-term upside to the $200 area. Longer-term target resides around $1000.
EOS (EOS) Technical Analysis & Outlook
TradingView Binance EOS/BTC 3-day linear chart
EOS/BTC is another one that we haven’t looked at in awhile that we’ll now turn our attention to given it is at some attractive levels following a textbook correction off of the highs from May, levels such as the 0.00010 level which is not only psychologically significant but is also where the bottom of the OTE long zone, top of the upper demand area, and still rising 50 SMA all reside. The fact that the momentum oscillators are getting close to fully recharged is also a good sign for the bulls, however the longer-term moving averages are still falling and the volume indications leave something to be desired so we’re expecting choppy, directionless conditions between 0.00010 – 0.00014 for several weeks before the market turns sustainably bullish once again later in the year.
Trade Idea: Buy dips below 0.00010 for shorter-term upside to the 0.00014 area. Longer-term target resides around 0.00030.
TradingView Bitfinex EOS/USD 3-day linear chart
EOS/USD has moved all the way from the $15 area down to the $4 region over the past several weeks on an almost endless succession of bearish candle formations that obliterated short and medium-term market structure, certainly a challenging environment for the bulls, however price is finally finding some support around previous highs and at the still rising 200 SMA so not all hope is lost for the bulls. The recharged momentum oscillators and bullishly divergent MACD are also some rays of hope for the bulls moving forward, although shorter-term we expect conditions to remain neutral to slightly bearish as long as price remains below $5.
Trade Idea: Accumulate below $2.50 for upside to the $10 area.
Good Luck, Good Trading!