Crypto Market Commentary & Outlook
Bitcoin (BTC) Technical Analysis & Outlook
Happy New Year everyone!!! Despite this being an extended holiday weekend for the legacy financial markets, bitcoin is taking no time off as price has quickly moved up above the $30k level over the past few days, a bit quicker than expected, and has since reached a local top of $33,333 earlier today before correcting 10% back down to test $30,000 for the first time since crossing that mark. The bulls were able to defend $30k on the pullback and now price is on its way back up in the classic crypto U pattern (Dalai Lama), which likely means that our $30 – $32k target is/was simply a speed bump and not the end of the intermediate-term move. Now we need to extend the Fibonacci levels to see where the next area of resistance might lie, which we’ll get to now to start the new year.
TradingView Bitstamp BTC/USD 6-hour linear chart
We’ll begin 2021 with a look at the 6-hour chart for a view of where the shorter-term technicals stand following the recent volatility and we can see that price quickly moved from $30,000 to $33,000 on the previous candle and closed near the highs thus creating a very bullish candle formation, and the brief move down to $30k a few hours ago that was rejected back to the upside has turned the current candle fairly bullish as well, so we’re still not seeing signs of a significant top at this time. The rising moving averages, very favorable volume indications, lack of historical resistance, and very bullish market structure also point to a bullish bias moving forward, so we’re now expecting even higher prices before a larger correction materializes.
TradingView Bitstamp BTC/USD weekly linear chart
Next we’ll look at the weekly chart for a view of the longer-term technicals where we can see that price has swiftly moved up into our target area between the 161.8% and 178.6% Fibonacci extension levels in short order on some large bullish candle formations that have yet to signal a major top of any kind, so we see no reason to fight the trend at this time. The accelerating moving averages, the encouraging volume indications, and a favorable MACD reading also point to more upside before a more substantial selloff than we saw earlier today, therefore we’re now calling for a continuation up to the 200% Fibonacci level around $36k over the next several days.
Trade Idea: Hold current long positions for upside to $36,000.
Monero (XMR) Technical Analysis & Outlook
XMR/BTC
TradingView Poloniex XMR/BTC weekly linear chart
Our fears for XMR/BTC have once again come true as we begin the new year considering price broke below the 0.00535 level we hoped would hold and subsequently plummeted to the mid-0.0040’s today where price is still trading at this hour, which is certainly discouraging news for the bulls moving forward. The current bearish candle formation, broken and bearish market structure, and the falling moving averages will make it difficult for the bulls to gain much traction over the shorter-term, however price is entering a very long-term demand area on almost fully recharged momentum oscillators so we would be buyers on dips below 0.0040 for longer-term holding.
Trade Idea: Buy dips below 0.0040 for longer-term upside to 0.0100.
XMR/USD
TradingView Bitfinex XMR/USD weekly linear chart
Unfortunately for the XMR/USD bulls, the Bittrex delisting news has pushed price back below $150 over the past few days thus voiding the bullish megaphone and sparking a bearish weekly candle formation that is turning market structure heavier with only 24 hours to go until the close, none of which bodes well for the bulls over the near-term. The still extended momentum oscillators aren’t helping matters for the bulls right now either, however the still rising moving averages and favorable A/D line suggest that we should remain bullish longer-term so we’ll continue to accumulate as price dips into support below $130.
Trade Idea: Buy dips below $130 for upside to $180.
Ethereum (ETH) Technical Analysis & Outlook
ETH/BTC
TradingView Binance ETH/BTC weekly linear chart
ETH/BTC is still retracing the spike down to 0.0227 from last week meaning price is back in the OTE long zone (between the 61.8% and 78.6% Fibonacci levels) on almost recharged momentum oscillators and still intact longer-term market structure, therefore we still want to be longer-term buyers in this support zone despite the recent pullback. Additionally, the fact that the A/D line remains fairly elevated is a sign that the recent weakness is being bought, however given bearish candle formations and mixed shorter-term moving averages we want to stay cautious in case lower prices materialize over the near-term.
Trade Idea: Buy dips below 0.023 for longer-term upside to 0.040.
ETH/USD
TradingView Coinbase ETH/USD weekly linear chart
ETH/USD has been moving to the upside over the course of this week, and this weekend has been no exception as our $800 target is now in sight, which we think will be attained in the not too distant future given the current bullish candle formation and favorable market structure. The rising moving averages and favorable volume indications also point to a bullish bias remaining in effect over the near-term, however momentum is almost overbought and price is in a longer-term supply area so we’re still comfortable with $800 as our target price for now even though we’re already fairly close to that level.
Trade Idea: Stay long for upside to the $800 area.
ChainLink (LINK) Technical Analysis & Outlook
LINK/BTC
TradingView Binance LINK/BTC daily linear chart
This is probably the last time we’ll look at LINK/BTC until price moves away from the current consolidation area given things have gotten pretty boring, however we wanted to warn the bulls that price action, candle formations, market structure, and volumes all suggest that a breakdown below this demand area is likely in the not too distant future. The fact that price has not seen much of a bid down here despite longer-term support is not a great sign either, and momentum is oversold but is not having impact right now so watch out below if 0.00032 gets taken out this week (which looks probable at this time).
Trade Idea: Stay neutral until further notice.
LINK/USD
TradingView Kraken LINK/USD daily linear chart
LINK/USD continues to consolidate around the $12 level on a hodgepodge of candle formations and highly uncertain market structure while the moving averages continue to converge on price, all pointing to more of the same as we start the new year. The mixed momentum oscillators and supply and demand areas around the market also suggest a directionally challenged market moving forward, although the volume indications still don’t look too bad so we’ll maintain a very slight bullish bias over a slightly longer-term timeframe.
Trade Idea: Stay neutral until further notice.
Good Luck, Good Trading!