Crypto Market Commentary & Outlook
Bitcoin (BTC) Technical Analysis & Outlook
BTC prices are down hard today on a barrage of seemingly bad news stories that have caused some fairly intense selling, however the double spending FUD has already been debunked and the CSW whitepaper lawsuit is ridiculous on its face, therefore we think these are more excuses for traders to take profits than a shift in the longer-term fundamental narrative. It didn’t help that Scott Minerd, CIO of Guggenheim Partners, said today that he expected bitcoin to go back to $20k before the bull market resumes and that it could take a year of consolidation as well, although we think he underestimates this asset and how quickly time moves in cryptoland.
TradingView Bitstamp BTC/USD 6-hour linear chart
We’ll return to the 6-hour chart as it remains the best view of the shorter-term technicals where we can see that the symmetrical triangle has been cleanly broken to the downside over the past few days and today there was follow-through all the way down to $30k on some fairly bearish candle formations that have broken shorter-term market structure, none of which is great news for the bulls moving forward. The fact that the 50 SMA has rolled over while the 100 SMA has been broken also suggests challenging conditions for the bulls over the coming days, however we think most of the downside from the highs is already in the market given the amount of technical and historical support between $25k – $29k so we want to stick with the plan despite price going below $30k recently.
TradingView Bitstamp BTC/USD daily linear chart
We’ll also return to the daily chart where we can see that there has been a clean break of the triangle today on a large and firmly bearish candle formation that has confirmed a break of near-term market structure while the momentum oscillators continue to recharge, all suggesting a bit more downside before a sustainable bottom materializes. The lack of support until sub-$30k also points to a bit of a bearish bias over the near-term, however the rising 50 SMA and upper demand area in the $27k area is very attractive from the technical perspective so we want to be buying dips in the $20k’s if given the chance over the coming days.
Trade Idea: Buy dips below $30,000 for upside to the $40,000 area.
Monero (XMR) Technical Analysis & Outlook
TradingView Binance XMR/BTC 6-hour linear chart
We’ll revisit the XMR/BTC 6-hour chart today to check in on the descending triangle and we can see that price is still trading inside of the formation on mixed candle formations and highly uncertain near-term market structure, so it looks like more consolidation is likely in this area over the next couple of days. That said, we worry that a breakdown is nearing considering a break of the 50 SMA today, the falling longer-term moving averages, the not yet fully recharged momentum oscillators, and the still bearish A/D line so we’ll stay neutral until we get the opportunity to buy back below 0.0040.
Trade Idea: Accumulate below 0.0040 for longer-term upside to 0.0100.
TradingView Bitfinex XMR/USD daily linear chart
XMR/USD has gotten hit hard by the selloff in bitcoin which has pushed price below the prior trading range and down to the $125 level on a very bearish candle formation that has threatened short-term market structure while the shorter-term moving averages are broken and closed below, not great news for the bulls over the coming days. The drop in the A/D line and the not yet fully recharged momentum oscillators also suggest some additional struggles for the bulls over the near-term, however the rising 200 SMA and the intermediate term demand area both reside in the ~$110 – $120 area so that is where we would like to get more aggressive on the long side if given the chance.
Trade Idea: Accumulate below $120 for longer-term upside to $200.
Ethereum (ETH) Technical Analysis & Outlook
TradingView Binance ETH/BTC daily linear chart
ETH/BTC is holding up surprisingly well despite the recent volatility in bitcoin therefore market structure remains firmly intact, good news for the bulls moving forward. The improving volume indications and the rising moving averages also are good signs for the bulls from a slightly longer-term perspective, although the daily candle that just painted is quite bearish and support is thin down to the 0.034 region which is where we’ll get more interested in getting active on the long side again.
Trade Idea: Buy dips below 0.035 for upside to 0.040.
TradingView Coinbase ETH/USD daily linear chart
ETH/USD has certainly taken a hit on the back of BTC weakness thus resulting in a move down to the $1050 area today on a firmly bearish candle formation that just closed near the lows while the momentum oscillators begin to recharge following bearish divergence at the top, all pointing to a bearish bias over the near-term. That said, the elevated and steady A/D line, improved exchange volumes, and still rising moving averages all suggest that we should be buying dips below $1000 for eventual upside to new all-time highs (likely near the $1700 level we discussed yesterday).
Trade Idea: Buy dips below $1000 for upside to $1700.
Yearn Finance (YFI) Technical Analysis & Outlook
TradingView Binance YFI/BTC daily linear chart
Last weekend DeFi was all the rage so we wanted to wait until the dust settled a bit before taking another look at YFI where we can see on the BTC pair that the falling moving averages rejected the recent rally and price has been moving lower ever since on fairly bearish candle formations, a falling A/D line, and recharging momentum oscillators, so more downside appears likely over the near-term. That said, shorter-term market structure is still intact, as is the longer-term double bottom, therefore we think nibbling on the long side below 0.80 is a good play over the coming months.
Trade Idea: Buy dips below 0.80 for upside to 1.20.
TradingView Binance YFI/USDT daily linear chart
Following the double top in the medium-term supply area earlier in the week price has been moving lower on bearish candle formations that are challenging shorter-term market structure while the momentum oscillators continue to recharge, not great news for the bulls over the coming days. The break of the 50 SMA over the past hour is also bad news for the bulls over the near-term, however the rising 100 SMA and the upper demand area in the $22k – $24k area is attractive from a technical perspective which is why we’ll leave some powder dry in case the selling continues into the weekend.
Trade Idea: Buy dips below $24,000 for upside to $40,000.