Crypto Market Commentary & Outlook
(Jan 14 – 2022)
Bitcoin (BTC) Technical Analysis & Outlook
While it’s nice to see BTC rally a bit while US equities sell-off going into the weekend, a much-needed break from a high correlation between these two markets recently, we’re still not getting too bullish (or bearish) over the coming days due to the very uncertain short to medium-term technicals. The lack of significant newsflow and persistent fears of Fed rate hikes are also likely to keep the bulls sidelined for another few weeks, at least, hence our continued caution heading into the second half of the month, although strong support below the market and still encouraging fundamentals are keeping us longer-term bullish until further notice.
TradingView Bitstamp BTC/USD 6-hour linear chart
First, we’ll look at the 6-hour chart for a view of the shorter-term setup where we can see that price is still riding the top of the broken downtrend line lower on momentum and volume indications that continue to tread water in no man’s land while medium-term market structure remains bearish, all pointing to more choppy waters ahead over the coming days. That said, we are getting a blue SCMR reversal signal today on a bullish engulfing candle formation while shorter-term market structure continues to show glimmers of hope for the bulls, not to mention we just had a 1 – 4 candle TD reset following last week’s 9, so we still think the $40k region is a good spot to accumulate despite the possibility of some additional shorter-term weakness into month’s end.
Short-term Trade Idea: Buy weakness below $41k for shorter-term upside to the $45k area.
TradingView Bitstamp BTC/USD weekly linear chart
We also want to look at the weekly chart for a view of the longer-term technicals where we can see that price is still finding support in the OTE long zone and upper demand area while the TD counts remains a 9 buy signal and the longer-term moving averages continue to move higher, all supportive of the idea of higher prices later in the year. Having said that, the resemblance to the Spring/Summer 2021 correction is undeniable, during which price was consolidating for six weeks near the lows before putting in a small doji candle like it is now that was followed up by another month of scary price action before the real rally began, suggesting that we’re not likely to see real sustainable price appreciation until sometime in mid-February hence patience and discipline remain paramount.
Long-term Trade Idea: Accumulate below $41k for longer-term upside to around $120k.
Monero (XMR) Technical Analysis & Outlook
TradingView Poloniex XMR/BTC daily linear chart
With a plethora of good news coming out over the past few days, XMR/BTC has shot to the upside following a very quick tag of the top of the OTE long zone earlier in the week thus creating a higher low and setting the market up for a more sustainable reversal of market structure over the coming weeks. The green SCMR signals, bullish candle formations, improving shorter-term moving averages, break of the 200 SMA, and a recovering OBV reading are also good signs for the bulls moving forward, although we’d like to see a close above the 0.0056 level (TD risk line) before getting too excited about a longer-term bull run.
Trade Idea: Accumulate below 0.0045 for longer-term upside to around 0.0100.
TradingView Bitfinex XMR/USD daily linear chart
XMR/USD is looking much better to end this week than it did to end last considering that the bulls have carved out a nice unconfirmed double bottom in the longer-term demand area on vastly improved market structure and a newly bullish TD count, all quite good news for the bulls moving forward. The break of the 50 SMA and the increasingly encouraging momentum and volume indications are also favorable signs for the bulls, however we must first see a move above the 200 SMA and downtrend line at $240 to get more bullish, followed by a breakout above $260 to confirm a double bottom breakout and hence additional upside.
Trade Idea: Accumulate below $200 for longer-term upside to the $1200 region.
Dero (DERO) Technical Analysis & Outlook
TradingView Kucoin DERO/BTC 3-day linear chart
The DERO/BTC bulls pulled off an impressive move over the course of this week by somehow managing to defend the mid-December lows around 0.00020 thus sparking an unconfirmed double bottom while also painting a blue SCMR reversal candle on the 3-day chart last night, all encouraging signals for the bulls moving forward. The fact that price is back above the still rising 100 SMA is also good news for the bulls, as is the still intact MACD divergence, all pointing to a shorter-term rally up to the 0.00030 area, although we want to stay patient for lower levels given our current position considering that there are still medium-term risks to the downside due to bearish market structure and an unfavorable TD count.
Trade Idea: Accumulate below the 0.00018 level with a longer-term target of 0.00100.
TradingView Kucoin DERO/USDT 3-day linear chart
The DERO/USDT chart does not look as good as the BTC pair above due to the lack of a double bottom and price being below the 100 SMA while the 50 SMA rolls over and active SCMR dynamic resistance dots build overhead, therefore caution remains warranted over the shorter-term. The volume indications also leave something to be desired for the time being as well, hence our patience for lower levels before considering adding to positions, however a rising 200 SMA, a blue SCMR reversal candle earlier this week, and bullishly divergent momentum oscillators are telling us that we are very close to a bottom therefore we need to move up our buy level until further notice.
Trade Idea: Accumulate below the $8 level with longer-term upside to around $120.
Bitcoin Cash (BCH) Technical Analysis & Outlook
TradingView Binance BCH/BTC 3-day linear chart
BCH/BTC has been treading water in a very tight range for over a month now on very small but mixed candle formations and an unhelpful TD count while the momentum and volume indications continue to stagnate and the moving averages all continue to fall, therefore more of the same appears likely over the near-term. Having said that, we are getting a blue SCMR reversal signal heading into the weekend while price is very close to the bottom of the range and previous regional lows from last Spring, and we have a Sequential TD 13 bottom signal developing, so we think there is some upside potential to 0.0100 over the coming weeks.
Trade Idea: Buy weakness below the 0.0085 level for medium-term upside to around 0.0100.
TradingView Coinbase BCH/USD 3-day linear chart
BCH/USD has moved down to new regional and cycle lows over the past week on red SCMR signals, still bearish market structure, and falling moving averages while active SCMR resistance dots continue to print overhead, none of which bodes well for the bulls over the near-term. That said, price is finding some support in the longer-term demand area while momentum remains oversold and MACD is bullishly divergent so we think there is a decent possibility of a bounce to the $450 region once the mid to high-$300’s have been thoroughly explored through the end of this month.
Trade Idea: Buy weakness below $350 for medium-term upside to the $450 area.
Good Luck, Good Trading!