Market Outlook #31

AD: Before I begin this post, I’d like to briefly mention Bitcoin.Live, who are sponsoring my blog.

Bitcoin.Live offers regular, detailed content on their free-to-access blog, created by a panel of analysts (including Peter Brandt), and covering all manner of market-related topics. I found both the video material and the blog posts to be genuinely insightful, with many differing analytical perspectives available for viewers and readers. The platform also offers premium content for paying subscribers who find value in the free material, with daily videos, alerts and support provided. Check it out and bookmark the blog.


Market Outlook #31 (14th April 2019)

Welcome to the 31st Market Outlook. It has been a relatively subdued week for Bitcoin but a bloodier week for alts across-the-board…

In today’s post, I’ll be covering the past week’s price-action in Bitcoin, Ethereum and Monero, as usual, plus – though it pains me to say it – presenting an opportunity in Verge.

Bitcoin:

Price: $5092

Market Cap: $89.796bn

Thoughts: After the fireworks of the prior week, this past week has been, as expected, somewhat subdued. That said, price did sweep above last week’s highs to form a new local high below $5500 before being slapped back down into the short-term range between $4800-$5300.

Looking at the Daily chart, we can see the strength in this recent rally, with higher timeframe closes above range resistance, trendline resistance and the 200-day moving average all in the space of a few days. RSI topped out at the highest levels seen since December 2017 when price came into significant resistancea at ~$5400. Even heavier resistance lies ahead in the $5800-6000 area, and it seems as though price is consolidating above the 200MA for the time being.

Looking now at the 4H chart, I have crudely depicted the path I expect Bitcoin to take over the coming weeks. Of course, this may not play out exactly as illustrated, but my general thesis is that we still have some room for another leg up towards the real resistance around $5800, from which we will see a strong rejection and a move back towards the original breakout level (range resistance) around $4500. We may even dip below this level (though it would now be expected to be a level of support) to trap breakout+retest buyers, but ultimately I believe the trajectory moving towards Q3 will be upwards.


Ethereum:

ETH/USD

ETH/BTC

Price: $164.03 (0.03231 BTC)

Market Cap: $17.319bn (3,413,062 BTC)

Thoughts: ETH/USD, after breaking above the supposed ‘double-top’ resistance at $170, found new resistance at an old level of support around $190. Price also broke out above the 200-day moving average and has remained above for the past week. Looking at the 4H chart, I expect ETH/USD to follow a similar path to Bitcoin, but to outperform it due to movements in ETH/BTC, as I shall explain shortly. However, in ETH/USD, we can clearly see a short-term range has been formed, and the bearish scenario would be for this to play out as a bear flag; as such, I’ll be watching for a 4H close below range support at ~$161 to indicate further downside towards the 200MA at ~$150. The declining volume on the retracement on both pairs suggests to me that more upside is the more likely path, however.

Now, looking at ETH/BTC specifically, there are many mixed signals being given here. We have a bearish breakout below trendline support and a retest of range resistance at 0.0353 BTC that failed to give way; we have price consolidating at the 200-day moving average; and we have declining volume on the recent dump. In my opinion, as long as 0.0318 BTC level remains firm as it has done thus far, we will see a bullish reversal and a reclamation of that 0.0353 BTC area.


Monero:

XMR/BTC

Price: $64.95 (0.01279 BTC)

Market Cap: $1.098bn (216,484 BTC)

Thoughts: After months of consolidation, we have seen two polar opposite weeks of price-action in Monero, with one week indicating a high-volume breakout above the range and the past week confirming it as a false breakout. Price is, in short, back where it has been since December; trading between 0.012 BTC and 0.0136 BTC. The 200-day moving average continues to cap price, but short-term support at 0.0125 BTC is holding firm.


Verge:

XVG/USD

XVG/BTC

Price: $0.0086 (169 satoshis)

Market Cap: $136.003mn (26,801 BTC)

Thoughts: Now, Verge is often met with equal revulsion as XRP in this space, but, as a speculator, I care not for ideology and only for opportunity. This is a solid, low-risk, high-reward opportunity. Verge has been range-bound between 140-240 satoshis for over 35 weeks, with patches of high volume during that time. As such, it is likely that this is the accumulation range preceding the next bull cycle. Further, XVG/USD has broken above 16-month trendline resistance and range resistance, with the 200MA currently supporting price.

The current price of 169 satoshis offers us a maximum of ~30% downside risk with a soft stop-loss on a Daily close below 120 satoshis (to account for any illiquid movements). In return for that risk, we have an initial target of the prior support turned resistance at 340 satoshis; a 100% return. As such, this trade is a minimum 3:1 reward-to-risk setup. Tighter stops can increase this drastically. Either way, it seems too good to pass up…

And that concludes this week’s Market Outlook. I hope you’ve found some value in the read.

As ever, feel free to leave any comments and questions below.


AD: I’d like to conclude this blog post by thanking one of the sponsors of the blog: Nexo.

Nexo is the foremost crypto-backed loans platform, allowing you to get cash without selling your crypto. Nexo delivers you cash or stablecoins via 45+ different currencies direct to your wallet or bank account.

The platform has already processed over $300m, with all client funds secured by BitGo and insured by Lloyds London. Nexo also offers interest on stablecoin deposits of 6.5%, with full withdrawal flexibility; providing a consistent revenue stream for your unused crypto.


If you’ve enjoyed this post and want to receive new posts straight to your inbox, I’ve set up a RSS-to-Email feed that will be sent out weekly; every Monday, 12pm. Just submit your email and I’ll make sure you’re included in the list. Cheers.

Market Outlook #30

AD: Before I begin this post, I’d like to briefly mention Bitcoin.Live, who are sponsoring my blog.

Bitcoin.Live offers regular, detailed content on their free-to-access blog, created by a panel of analysts (including Peter Brandt), and covering all manner of market-related topics. I found both the video material and the blog posts to be genuinely insightful, with many differing analytical perspectives available for viewers and readers. The platform also offers premium content for paying subscribers who find value in the free material, with daily videos, alerts and support provided. Check it out and bookmark the blog.


Market Outlook #30 (7th April 2019)

Hello, and welcome to the 30th Market Outlook. It’s been a very busy week in and out of the markets, with the primary talking point naturally being the 23% upwards breakout in Bitcoin in the early part of the week. We shall, of course, be covering that in great depth, but there’s plenty else to discuss…

In this week’s post, I’ll be looking at the past week’s price-action in Bitcoin, Ethereum and Monero, plus providing an update on Komodo.

Let’s crack on:

Bitcoin:

Price: $5160

Market Cap: $90.99bn

Thoughts: So, it seems Bitcoin decided to ignore the expectations I put forth in last week’s post of a gentle, sustained rise over the course of the week, and instead went for the explosive breakout. In the space of about two hours at the beginning of the week, price moved from ~$4100 to ~$5100; a near-25% jump. Volatility of this kind has not been seen for months, and bullish momentum to this degree has not been seen for over a year.

Looking at the first Weekly chart provided, it seems to be the case that Bitcoin is indeed playing out a similar (but not identical) price fractal to the bear market of 2014/15. The tightening of the gap between the 20-week moving average and the 200-week moving average led to an upside breakout from trendline resistance back in 2015, just as it did this past week. This breakout led price towards a level of support turned resistance at around $320 in the summer of 2015, initially followed by a rejection and retest of the 200-week moving average.

Now, if something to that effect was to play out, we should see price reach for just shy of $6000, reject hard and retest the Weekly 200MA at around $3500 over the next few months. This would provide strong support, allowing for a bullish continuation and a break back above the key $6000 area towards the end of the year. Whilst I do not expect price-action to be quite so tidy, I do believe this will be the general direction of the market for the remainder of the year.

Looking now at the second Weekly chart provided, we can see a clear and strong breakout from January 2018’s trendline resistance on significant volume, indicating to me that the cyclical low is indeed in. I have gone out on a limb in previous posts and mentioned that I believed we had found the cyclical low above $3000, but, to me, this confirms that theory. Further, we have also broken out above range resistance that has been in play since November 2018.

Finally, looking at the Daily chart, we can also observe that price has closed above the 200-day moving average (often a reliable proxy for relative bullishness or bearishness), but that there is much to be wary of in the short-term. There is now significant overhead resistance between $5500-6000 and RSI is the highest it has been on the Daily timeframe since the beginning of the bear market in January 2018; now, indicators are by no-means a be-all, end-all, and I do not value them above price-action or volume itself, but there is enough indication here across all possible analytical perspectives that Bitcoin needs a bit of a breather.

In truth, I do not expect the first dip to be of any significance, unlike those that believe we retrace the majority of this entire past week’s movement – instead, I see price dipping towards $4800, before making a move up to test that heavy overhead resistance zone. It is from this area that I think we see the hard rejection that leads to a move back towards $4400 and likely below that. However, this is a scenario that I believe will play out over the course of the next couple of months rather than next week.

Next week, I think we see some more consolidation between $4800-5300 – but we still have tonight’s Weekly close to concern ourselves with…


Ethereum:

ETH/USD

ETH/BTC

Price: $168.11 (0.03271 BTC)

Market Cap: $17.745bn (3,444,267 BTC)

Thoughts: Ethereum is in a very interesting place at the moment, given the dump that occurred in ETH/BTC courtesy of Bitcoin’s movements over the past week. Firstly, looking at the ETH/USD Weekly chart, we can see that price is still being capped by trendline resistance from January 2018, unlike with Bitcoin, but also that price looks to be ready to close strongly above the 20-week moving average for the first time since the bear market began. Price also remains capped by support turned resistance at ~$170.

The first Daily chart I’ve provided shows the relationship between the 20-day and 200-day moving averages on ETH/USD throughout its price-history, and we can clearly see that Ethereum’s bull market began when the former crossed the latter in February 2017. Looking now at the recent price-action, we can see the same cross inching closer to occurring. Price did consolidate for a good week or two before taking another leg up after this cross took place in early 2017, so perhaps we shall see some consolidation over the next week also.

The second Daily chart gives us a much closer view of recent movements, with a clear rejection from closing below the 200MA but a lack of willingness to close above trendline resistance or horizontal resistance; again, much like Bitcoin, this is an area with a lot of overhead resistance.

Looking at the ETH/BTC chart, we can get a clearer idea as to what Ethereum can be expected to do next. Price is currently in a contentious area, struggling to spend much time above or below the trendline resistance. This past week took price below the 200-day moving average for the first time since February, but only briefly, with price now trailing it almost to the satoshi. The uptrend from December has been lost on significant volume, which is not a particularly good sign, and yet the explanation of such a move is simple; the unanticipated short-term volatility that occurred in Bitcoin. I expect that the level I have marked ‘critical support’ at 0.0298 BTC will hold, with price consolidation whilst Bitcoin figures out its next move, followed by a continuation of bullish momentum; in fact, this, for now, is simply a higher swing-low.


Monero:

XMR/BTC

Price: $69.75 (0.01352 BTC)

Market Cap: $1.179bn (228,505 BTC)

Thoughts: Unbelievable… I finally have something to say about Monero after 106 days of range-bound price-action. This past week saw the range broken to the upside on significant volume, with the 200-day moving average providing resistance. Following this, price rejected hard and dumped back into the range, all the while remaining above short-term support at 0.0128 BTC. Now, it seems as though Monero wants to escape the range once again, but I expect some more consolidation around range resistance at 0.0136 BTC before the 200-day MA is tackled again.


Komodo:

KMD/BTC

Price: $1.23 (23,878 satoshis)

Market Cap: $138.509mn (26,867 BTC)

Thoughts: Much like the rest of the entire market, it is clear that the Bitcoin volatility was unexpected for Komodo holders, and many jumped to sell their coins for whatever reasons they believed made sense in their own heads…

Clearly, large holders (or so-called smart money) did no such thing, as the volume on the dump is barely visible on the chart, and price remains above the range breakout level at 22500 satoshis. I expect perhaps some more dumping by weak hands if Bitcoin does make another 5-10% move upwards next week, but that the uptrend will remain intact and that any move below 22500 satoshis will be shortlived. Over the coming weeks and months, the direction seems clear to me.

And that concludes this week’s Market Outlook. I hope you’ve enjoyed the read.

As always, feel free to leave any comments or questions below!


AD: I’d like to conclude this blog post by thanking one of the sponsors of the blog: Nexo.

Nexo is the foremost crypto-backed loans platform, allowing you to get cash without selling your crypto. Nexo delivers you cash or stablecoins via 45+ different currencies direct to your wallet or bank account.

The platform has already processed over $300m, with all client funds secured by BitGo and insured by Lloyds London. Nexo also offers interest on stablecoin deposits of 6.5%, with full withdrawal flexibility; providing a consistent revenue stream for your unused crypto.


If you’ve enjoyed this post and want to receive new posts straight to your inbox, I’ve set up a RSS-to-Email feed that will be sent out weekly; every Monday, 12pm. Just submit your email and I’ll make sure you’re included in the list. Cheers.

Market Outlook #29

AD: Before I begin this post, I’d like to briefly mention Bitcoin.Live, who are sponsoring my blog.

Bitcoin.Live offers regular, detailed content on their free-to-access blog, created by a panel of analysts (including Peter Brandt), and covering all manner of market-related topics. I found both the video material and the blog posts to be genuinely insightful, with many differing analytical perspectives available for viewers and readers. The platform also offers premium content for paying subscribers who find value in the free material, with daily videos, alerts and support provided. Check it out and bookmark the blog.


Market Outlook #29 (31st March 2019)

Afternoon, and welcome to the 29th Market Outlook.

In today’s post, I’ll be covering the past week’s price-action in Bitcoin, Ethereum and Monero, as well as providing an update on Litecoin and discussing a low-risk, high-reward opportunity spotted in XEL.

Bitcoin:

Price: $4160

Market Cap: $73.297bn

Thoughts: As anticipated in last week’s Market Outlook, this week brought a continuation of bullish momentum, with price taking out the highs formed mid-March at $4170. With these highs swept, price began to consolidate a little, turning prior short-term resistance into support at ~$4100.

We remain at the very top of the longer-term range, however, and thus caution must be urged to those getting a little too bullish; until price closes on the higher timeframes and on significant volume above $4500, there is no reason to believe the range resistance won’t hold. As such, I expect price to continue moving upwards to take out the local high at $4280, where many stops will be resting, after which we may find significant overhead resistance that necessitates a move back down towards the $4050 level.

That said, we shall cross that bridge when we get to it, and I believe the following week will be one of further bullish continuation.


Ethereum:

ETH/USD

ETH/BTC

Price: $141.56 (0.03457 BTC)

Market Cap: $14.925bn (3,646,596 BTC)

Thoughts: I have provided the Weekly chart for ETH/USD to give some context as to the overhead resistance inching closer, in the form of 15-month trendline resistance. That said, we look set to close the first Weekly candle in the green above the 20-week moving average; something that has not happened since the bear market began in ETH. Declining volume does suggest we may experience a brief drop off as that trendline resistance is approached, and this lines up with my expectations for ETH/BTC.

Looking at the ETH/BTC 4H chart, we can see that price is very much still range-bound, but the recent uptrend remains intact and there is a clear divergence in the RSI, indicating underlying strength in the market. I expect price to make another attempt at 0.0352 BTC this coming week, followed by a rejection, with price falling back to the trendline before finally making a move above the short-term resistance. Ultimately, I expect to see a breakout above range resistance at 0.036 BTC in April.


Monero:

XMR/BTC

Price: $53.50 (0.01307 BTC)

Market Cap: $903.56mn (220,789 BTC)

Thoughts: 106 days into accumulation… partial profits from outside trades continuing to be cycled into Monero inside this range.


Litecoin:

LTC/USD

LTC/BTC

Price: $60.59 (0.0148 BTC)

Market Cap: $3.703bn (904,948 BTC)

Thoughts: So, I’ve provided a potential fractal for LTC/USD on the Weekly chart, though I do doubt that the duration of the consolidation (if this plays out) will be anywhere near the length of the previous cycle. Looking at the chart, we can see the similarities in price-action, most importantly with price experiencing a similar follow-through in momentum following the close above the Weekly 20MA.

Now, looking at the LTC/BTC chart, unlike most other alts, it seems to me that Litecoin is running out of steam, having initially led the charge forward and doubled in price since December. RSI is showing bearish divergences and volume is declining at a significant area of prior support now turned resistance. I am expecting a move back toward 0.0125 BTC before any further upside.


XEL:

XEL/BTC

Price: $0.03 (785 satoshis)

Market Cap: $2.944mn (719 BTC)

Thoughts: Given the slowly shifting sentiment and reversion to bullish market structure on alts, I am becoming more and more open to taking positions purely based on technicals (as I showed with the ADT position I opened following Market Outlook #27)

Similarly, here I have spotted a high-reward, low-risk opportunity in XEL, cemented by the recent volume spike that saw almost a quarter of its supply traded inside a day, indicating significant interest. I am buying below 800 satoshis, with a soft stop-loss on a Daily close below 675 satoshis, with a target of 1500 satoshis. This is a ~6:1 reward-to-risk trade.

And that concludes this week’s Market Outlook. I hope you’ve found some value in the read.

As ever, feel free to leave any comments or questions below!


If you’ve enjoyed this post and want to receive new posts straight to your inbox, I’ve set up a RSS-to-Email feed that will be sent out weekly; every Monday, 12pm. Just submit your email and I’ll make sure you’re included in the list. Cheers.