Crypto Market Commentary & Outlook
(Jan 7 – 2022)
Bitcoin (BTC) Technical Analysis & Outlook
The crypto markets remain under pressure to end this first workweek of 2022 due to deteriorating technicals, bearish price action, and persistent worries regarding Fed rate hikes, and for now it looks like this downward trend will continue over the shorter-term. While it’s difficult to determine exactly where a capitulation wick might materialize over the coming days, we still think that in terms of timing we’re getting close to the end of this correction. With that said, let’s move to the charts to try to glean some clarity concerning levels that we should be watching over the upcoming weekend.
TradingView Bitstamp BTC/USD daily linear chart
First, we want to look at the daily chart for a view of the medium-term technicals where we can see that price has moved down to new regional lows below the $41,976.50 wick from early December today which broke medium-term market structure on a bearish candle formation and red SCMR signal while the TD 5 count suggests at least 4 more days of selling, therefore we need to stay very cautious and on the sidelines until further notice. The active SCMR resistance dots overhead, the falling 50 SMA and impending 50/200 SMA death cross, bearish volume indications, and not yet recharged momentum oscillators also point to more downside over the near-term, however we expect momentum to become oversold early next week when we get a TD 9 buy signal so Monday/Tuesday is when we’ll start to look for signs of a bottom/reversal.
Short-term Trade Idea: Stay neutral until further notice.
TradingView Bitstamp BTC/USD weekly linear chart
We also want to zoom out to the weekly chart to see where the technicals stand following the recent selloff and for now things don’t look great considering price is at new regional lows, hence a break of shorter-term market structure, on a bearish candle formation, red SCMR signal, and falling momentum oscillators, hence the bulls have their work cut out for them if they want to defend this $40k level. That said, we’ll very likely have a perfected TD 9 signal next week (in conjunction with the daily TD 9 previously discussed) while price falls deeper in the OTE/demand area support confluence zone so we’ll look for signs of a bottom and perhaps some potential entries heading into next week.
Long-term Trade Idea: Accumulate below $40k for longer-term upside to around $120k.
Monero (XMR) Technical Analysis & Outlook
TradingView Poloniex XMR/BTC daily linear chart
XMR/BTC has indeed continued to move generally lower over the past several days as expected following the top around New Year’s Day and we anticipate that this trend will continue over the shorter-term despite the lack of a red or orange SCMR signal and despite the bounce over the past 24 hours. This is due to the still bearish TD count, the still recharging momentum oscillators, the falling longer-term moving averages, still bearish market structure, and a lack of support until the low-0.0040’s, which is where we’ll start to watch for buy signals on a higher low moving forward.
Trade Idea: Accumulate below 0.0042 for longer-term upside to around 0.0100.
TradingView Bitfinex XMR/USD daily linear chart
XMR/USD has moved back below the $200 level over the past few days on bearish candle formations, red SCMR signals, still bearish shorter-term market structure, and a discouraging TD count, all suggesting that more downside is likely before we see the bulls return. The falling moving averages, active SCMR resistance dots, and still recharging momentum oscillators also point to a bearish bias over the weekend, hence we’ll pause our buying considering we’ve already added around current levels.
Trade Idea: Stay neutral until further notice. Longer-term target remains around $1200.
Dero (DERO) Technical Analysis & Outlook
TradingView Kucoin DERO/BTC 3-day linear chart
DERO/BTC has broken back below the 50 SMA today on a bearish candle formation and red SCMR signal that is keeping shorter-term market structure quite concerning while the TD count points to more downside over the next week or so, none of which bodes well for the bulls moving forward. The still lackluster momentum oscillators and not yet recharged momentum indications also suggest that the bias is likely to the downside over the near-term, however we continue to like the support confluence that is developing between 0.00015 – 0.00020 which is where we start to look for signs of a sustainable bottom/reversal.
Trade Idea: Accumulate below the 0.00018 level with a longer-term target of 0.00100.
TradingView Kucoin DERO/USDT 3-day linear chart
DERO/USDT is very close to breaking down to new local and regional lows today on a bearish candle formation, red SCMR signal, early red TD count, and still bearish shorter-term market structure, so the path of least resistance remains to the downside for now. The active SCMR resistance dots and the discouraging momentum and volume indications confirm this view, however the $6 – $8 confluence area remains quite attractive so that’s where we’ll start to look for long entries once again.
Trade Idea: Accumulate below the $8 level with longer-term upside to around $120.
Pirate Chain (ARRR) Technical Analysis & Outlook
Coinigy TradeOgre ARRR/BTC 3-day linear chart
ARRR/BTC continues to grind sideways inside of the demand area on mixed candle formations and still slightly bearish market structure while the momentum and volume indications continue to bleed, not great news for the bulls over the shorter-term. Neither is the quickly falling 50 SMA, hence we need to be ready for a capitulation wick down to the 0.00001000 area before a sustainable bottom forms, although the longer the bulls can defend this support region in general the better the odds of a reversal become so we’ll check back in next week to see if the 0.00001600 regional lows can indeed hold. Until then, we’ll stay neutral.
Trade Idea: Stay neutral until further notice.
CoinTraderPro CoinPaprika ARRR/USD daily linear chart
ARRR/USD has been bleeding to the downside over the past few weeks on bearish candle formations that are putting pressure back on an already bearish market structure situation while all of the moving averages continue to fall and OBV continues to deteriorate, all suggesting lower prices before the bulls return in earnest. The fact that price is still riding the longer-term downtrend line lower also points to a weak near-term outlook, however the support confluence around the $0.70 level is where we’ll start to look for signs of a bottom/ reversal.
Trade Idea: Stay neutral until further notice.
Good Luck, Good Trading!