You are currently viewing Market Outlook #121

Market Outlook #121

Market Outlook #121 (19th April 2021)

Hello, and welcome to the 121st instalment of my Market Outlook.

In this week’s post, I will be covering Bitcoin, Ethereum, XRP, Monero, Algorand, Zilliqa, Golem, Fetch.ai, COTI and Constellation.

As ever, if you have any suggestions for the next post, feel free to leave them in the comments below.

Bitcoin:

Weekly:

BTCUSDWeekly

Daily:

BTCUSDDaily

Price: $56,844

Market Cap: $1.074bn

Thoughts: If we begin by looking at the weekly chart for BTC, we can see that the picture looks decidedly more bearish than it has in quite some time after last week’s price-action. Following a break above multi-week resistance at $61,800 to a new all-time high at $64,900, BTC then spent the weekend selling off, culminating in a weekly close back inside resistance and around 14% off the weekly high. This occurred on higher volume than in the previous couple of weeks but still lower volume than earlier in the year, and the pair appears to have now broken the trendline support that has held firm since the rally began in October 2020. More concerningly, as mentioned last week, we swept the all-time high cleanly and closed back inside, printing a swing-failure pattern. Where I had previously been expecting upside resolution of the range, the failed breakout has changed my mind and I am now looking at the weekly swing-low at $50,300 as the next area of interest from here; given last week’s low fell short of sweeping that low (coming in around $51k), we now have somewhat of a double-bottom in that area where I expect many longs to have positioned their stops. As such, I am now looking for those lows to be swept this coming week. If we do see that occur, the reaction will be telling; sweep the lows and close the week back above $50,300 and we have probably found a new bottom and will likely consolidate from there before resuming the uptrend; however, close below $50,300 on the weekly and market structure will have turned bearish for the first time since the March 2020 capitulation. In that case, we will almost certainly trade back towards the previous range resistance turned support around $43,000. It is that area that will determine whether the bull market is over or where we simply need a longer period of consolidation above that range before beginning another leg higher. In my opinion, this does not feel like a top, primarily due to the low volatility grinding price-action that has been experienced over recent weeks – no blow-off top, no cycle top, from past experience. More likely, however, is a correction akin to that which has occurred in the latter half of every month this year thus far: 30% off the all-time high at $64,900 would put price in the region of $45k, above which I would remain mid-term bullish. My bear market scenario occurs if we trade lower from here, close the weekly below $50,300, form a lower-high on the weekly, then close below $43,000 – that, for me, would be an exit signal into majority fiat. Until then, I assume we are in for more bleeding going into May before the uptrend resumes.

Now, turning to the daily, given that the Coinbase IPO narrative dominated last week, we saw BTC trade higher at the beginning of the week, closing firmly above range resistance (as we wanted to see) and trading into that $64k area that I had expected to provide some resistance on the first test. However, rather than hold above the prior range high at $61,800, the pair began to close back below it towards the end of the week, indicating that the break higher was likely a deviation from the range. Subsequently, the weekend saw a deep sell-off, causing the largest nominal liquidation event in history and sending price all the way to $51k, with price closing below local and longer-term trendline support but, crucially, printing a swing-failure of the most recent swing-low at $55,400 (price swept the level hard but managed to close back above). So, we have conflicting signals – a weekly bearish swing-failure but a daily bullish swing-failure. It is always better to assume that the higher time-frame pattern is the more likely one to determine future price-action, but if we do see some strength here early this week, I would be looking for a weekly low to form over the next couple of days above last week’s low, from which the pair should then reclaim $57,800. If we see this, this entire move might well have been a bear trap. However, lose last week’s low and the swing-failure is invalidated and the hopes for bulls rest on that $50,300 area providing enough liquidity for a sharp reversal. I am sure we are in for a volatile week regardless of direction…


Ethereum:

ETH/USD

Weekly:

ETHUSDWeekly

Daily:

ETHUSDDaily

ETH/BTC

Weekly:

ETHBTCWeekly

Daily:

ETHBTCDaily

Price: $2247 (0.03938 BTC)

Market Cap: $256.112bn

Thoughts: Whilst ETH/BTC continues to look strong, the Dollar pair suffered due to Bitcoin’s weekend sell-off.

If we begin with ETH/USD, we can see that the pair marched on to new all-time highs last week, rallying all the way into the 1.618 extension of the prior range at $2526, printing a weekly high at $2550. However, the BTC/USD sell off dragged the pair down late in the week, as low as $2240 for the weekly close. Despite this, the pair closed at its highest weekly close of all-time on higher volume than has been traded in several weeks, which suggests strength on Ethereum’s part. If we drop into the daily, yesterday saw price retest the prior range high at $2050 as support, with price closing near daily highs around $2240, but if we do see BTC/USD continue to bleed this week I would expect ETH/USD to follow suit, likely sweeping last week’s low into support at $1925, which I would like to see hold as it aligns with trendline support. Lose that level and the pair would likely trade as low as $1546 before finding a bottom, but given the strength being shown in ETH/BTC, I doubt we will see price trade so low again any time soon after such a convincing breakout (where BTC has been anything but convincing). Looking ahead, if the pair is able to hold above $1925 this week, I would expect ETH/BTC to begin dragging it higher going into May, with the next target at $2750-2800.

Turning to ETH/BTC, last week closed at weekly highs on higher volume than the preceding four weeks, just shy of the 2020 high at 0.0406. As mentioned last week, I wanted to see the pair at least hold its ground if BTC/USD began to sell-off, and we saw it do precisely that and more, which is encouraging. However, the pair is now coming into an area of resistance around 0.0406 to 0.0419, which may cap it this week before continuation higher. Looking at the daily, yesterday saw prior resistance retested as support at 0.0375 and in all honesty the pair looks like it wants new yearly highs over the next four weeks or so. If the overhead resistance at 0.042 can be flipped as support, I’d expect 0.0462 to be retested, followed by 0.0535. However, if last week’s strength is not seen this week in the face of another BTC sell-off, I’d be looking for that 0.035 area to remain firm as support before another leg higher.


XRP:

XRP/USD

Weekly:

XRPUSDWeekly

Daily:

XRPUSDDaily

XRP/BTC

Weekly:

XRPBTCWeekly

Daily:

XRPBTCDaily

Price: $1.38 (2452 satoshis)

Market Cap: $60.13bn

Thoughts: Beginning with XRP/USD, last week saw the pair push on for new yearly highs into $1.98, before closing below the preceding week’s high and back around the 38.2% retracement of the bear market around $1.35. Given the rejection above the 50% retracement, it appears likely that the pair needs to consolidate a little more before attempting another leg higher. On a longer-term perspective, it would still look bullish even if the pair dumped all the way back into $0.97 to retest the breakout area as support, which is an area I would absolutely look for longs. If we look at the daily, yesterday saw the prior consolidation range get retested as support at $1.12, so I would look at the reaction should that level get swept this week for a potential long; if we see $1.12 get swept and price close back above it, I’d expect that area to hold as support and for the pair to begin working its way back to the yearly high again. As I say, however, there would be nothing bearish about market structure on either the weekly or daily time-frame at present even if we saw a sell-off back into $0.97.

Looking at XRP/BTC, the pair closed higher than the preceding week at 2500 satoshis, having tested resistance at 2800 satoshis and failed on the first attempt. Volume was almost as high as the breakout week and the pair remains above the cluster of prior resistances, so I am still expecting continuation into 4000 satoshis over the coming weeks. Looking at the daily, an ideal entry for longs would be a retest of 1900 satoshis, should it come. However, if the 2250 area holds firm, as it did yesterday, a daily close above 2767 would open up that move to new yearly highs. XRP undoubtedly looks like one of the stronger plays in the market at present.


Monero:

XMR/USD

Weekly:

XMRUSDWeekly

Daily:

XMRUSDDaily

XMR/BTC

Weekly:

XMRBTCWeekly

Daily:

XMRBTCDaily

Price: $336.13 (0.005929 BTC)

Market Cap: $5.857bn

Thoughts: Beginning with XMR/USD, we can see the pair has been continuing its relentless march towards all-time highs, albeit stalled somewhat by BTC/USD. Last week saw the pair close at yearly highs, testing the 78.6% retracement of the bear market at $383 before closing around $339. Last week also saw the highest trading volume on Kraken for the pair in a couple of months. I would now expect to see some consolidation below the $380 resistance, before continuation towards that all-time high at $480, which will likely be driven by XMR/BTC. Looking at the daily, yesterday saw the pair retesting the previous range high as support at $287.50, looking somewhat similar to how price reacted after originally hitting $287.50 in late February and subsequently retesting the prior range resistance turned support at $186. I would be looking for something akin to that period of consolidation to now follow before continuation higher, and I would like to see $287.50 remain firm as support. Looking ahead, there is no resistance into the all-time high once the $380 level gets flipped, so no doubt we see acceleration following that breakout.

Turning to XMR/BTC, price has rallying out of the multi-week range between 0.0038 and 0.005, closing above those range highs and continuing higher last week into historical support now turned resistance at 0.006. This is the most critical level on the chart for me at the moment, as a weekly close above this area would confirm a much larger reversal, back towards 0.01, which is the impetus I am looking for for an all-time high break on the dollar pair. If we do see 0.006 get flipped, those on the sidelines could look at  buying the retest with an initial target of 0.0085 and a second target of 0.001, followed by a final target of last year’s high at 0.0116. If we drop into the daily, we can see that not only is there prior support in this area but also the 200dMA which capped price in December 2020. I don’t expect this first test to lead to the breakout, so we may see a dip into 0.0056 before a second attempt, but I do think it gives way. As long as the pair holds above 0.005 now, I remain bullish Monero.


Algorand:

ALGO/USD

Weekly:

ALGOUSDWeekly

Daily:

ALGOUSDDaily

ALGO/BTC

Weekly:

ALGOBTCWeekly

Daily:

ALGOBTCDaily

Price: $1.45 (2560 satoshis)

Market Cap: $4.113bn

Thoughts: If we begin by looking at ALGO/USD, we can see from the weekly that we finally got the weekly close above channel resistance after consolidating below it, with price retesting it as support into $1.30 last week. I am now long ALGO and positioned for the long-term, looking for new all-time highs above $3.75, with $2.70 as my first target. My invalidation here is a weekly close below $0.91. If we look at the daily, we can more clearly see the resistance area being flipped as support, and that $0.92 area is a must hold now; if it fails, that would turn market structure bearish, thus opening up the possibility of a much larger correction. Once we see a daily close above resistance at $1.90, I will be looking to add to my position on dips.

Turning to ALGO/BTC, if we look at the daily chart for clarity, we can see that the 200dMA and 360dMA have now been reclaimed as support, with the pair breaking above resistance at 2540 satoshis that capped the pair throughout March. I’d like to see this cluster hold as support now, with 3000 satoshis the next area to flip as support; once that gives way, we will likely see acceleration back into 4060, followed by 4880. Again, a break and close above 3k would be the trigger to start looking for areas to add to my position on dips, as I’d expect much more upside from there.


Zilliqa:

ZIL/USD

Weekly:

ZILUSDWeekly

Daily:

ZILUSDDaily

ZIL/BTC

Weekly:

ZILBTCWeekly

Daily:

ZILBTCDaily

Price: $0.196 (347 satoshis)

Market Cap: $2.145bn

Thoughts: Beginning with ZIL/USD, if we look firstly at the weekly chart, we can see that price finally broke new all-time highs last week above $0.0235, hitting $0.0258 before the BTC sell-off dragged it lower. The weekly then closed below the all-time high, rejecting the breakout. That said, the pair remains above trendline support in a parabolic rally, and if it can hold above $0.175 I think we see new all-time highs traded again shortly. However, close this week below trendline support and $0.185, and I would expect to see a move back into $0.132, where we may see another consolidation range form before another leg higher. Ultimately, I am looking at $0.37 to be tagged before this cycle tops out. Dropping into the daily, trendline support can be observed clearly here, having held on yesterday’s test, and RSI is far from extremely overbought conditions. I would expect to see this rally continue higher to be honest, particularly when we look at ZIL/BTC, which looks a lot different to many other alts.

Turning to ZIL/BTC, we can see that the pair closed above the historical pivot at 345 satoshis and has since been consolidating above it and the test pump highs around 310 satoshis. Whilst this area holds as new support, I would expect to see ZIL continue higher from here, dragging its USD value higher regardless of what BTC does. My first target for ZIL from here is that 600-satoshi area, which I think will provide significant resistance. If we do see 310 satoshis fail to hold, I will likely exit my position and re-assess.


Golem:

GLM/USD

Weekly:

GLMUSDWeekly

Daily:

GLMUSDDaily

GLM/BTC

Weekly:

GLMBTCWeekly

Daily:

GLMBTCDaily

Price: $0.47 (829 satoshis)

Market Cap: $474.427mn

Thoughts: If we begin by taking a look at GLM/USD, from the weekly we can see that the pair has been consolidating below resistance at $0.75, having initially tested it in March but failed since on multiple attempts to break above. Following last week’s sell-off, the pair retested local support at $0.44, which bulls want to see hold, as there is no support below back into the $0.25 area, which – should it come – would be a buy, in my opinion. However, if it can hold above $0.44, I’d expect the consolidation to lead to yet another attempt at $0.75 sooner rather than later; close the weekly above that and we will likely see acceleration above $1. On the daily, we can see that the $0.25 area would line up with a 200dMA retest, which has supported the trend since May last year. Also, RSI has been diverging indicating a momentum shift, and with the multiple successive tests of $0.44, if we do now see a daily close below that level I will be setting those $0.25 bids.

Now, looking at GLM/BTC, the pair has rallied off the all-time low at 170 satoshis but remains capped by the prior support turned resistance at 1560 satoshis, with this level acting as resistance twice in 2020 and price now consolidating well below it. If we see GLM sell off back into range support from here at 340 satoshis, that would be a buying opportunity in my opinion, with an initial target of that 2020 resistance below 1600. Plenty of upside just within this long-term range, if we can time a buy correctly. Looking at the daily, the pair is holding above the 200dMA and 360dMA, so perhaps we won’t see such a drastic dump back into the range support, with 760 satoshis currently holding firm, having acted as a pivot throughout the past year. If this level fails to give way, a break above the recent high at 1193 would be a trigger for upside all the way into 1560. Looking ahead, a weekly close above 1560 would open up a move into the next area of resistance at 2700 satoshis.


Fetch.ai:

FET/USD

Weekly:

FETUSDWeekly

Daily:

FETUSDDaily

FET/BTC

Weekly:

FETBTCWeekly

Daily:

FETBTCDaily

Price: $0.526 (935 satoshis)

Market Cap: $371.485mn

Thoughts: Beginning with FET/USD, we can see from the weekly that its parabolic curve has broken, suggesting that – at the very least – we will be seeing a period of consolidation here before any continuation is possible, with RSI already having come off from extremely overbought conditions but still some way off where it bottom in the previous mini-cycle. From here, I would like to see this prior all-time high area around $0.50 hold as support, but if BTC/USD drags FET down, I’d be looking at the $0.34 area as a must-hold resistance turned support, above which I’d expect to see a new range form before what is likely to be a third and final leg higher. If we drop into the daily, we can see that the previous cycle traded into the 360dMA before bottoming and beginning the second wave, so if we see something similar, we could trade all the way back into the 2020 highs and prior resistance cluster around $0.20, which would be the point at which I begin allocating significant capital back into some of these currently over-extended alts. If you recall from last week, I mentioned that I am no longer generally reallocating profits to new alt positions at the moment, save a few exceptions, and something like a move back into at least $0.34 would be the trigger to begin positioning myself once again for a third wave.

If we look at FET/BTC, the weekly shows resistance was found in the same area as in Q3 2020, around 1500 satoshis, where price rejected a few weeks ago and has since sold off. If we look at the daily, there are two potential scenarios from here that I am considering: if BTC/USD does sell off from here and potentially form a new range, it is possible we see alts begin to move higher again against BTC, in which case we could see 850 satoshis hold as support and then the pair revert to bullish market structure, printing higher-highs and higher-lows back into a 1550 satoshi retest. However, if alts fail to find strength over the next couple of weeks, FET could trade 30-40% lower from here back into the 630-satoshi area, perhaps wicking into the 360dMA before bottoming and beginning that third and likely final wave. If we do see the pair trade significantly lower from here, I would look to position myself heavily around 600 sats, but would assess closer to the time.


COTI:

COTI/USD

Weekly:

COTIUSDWeekly

Daily:

COTIUSDDaily

COTI/BTC

Weekly:

COTIBTCWeekly

Daily:

COTIBTCDaily

Price: $0.0285 (505 satoshis)

Market Cap: $193.126mn

Thoughts: COTI has been a little disappointing of late, but it appears to be acting quite similarly to other smaller midcaps on Binance, like FET.

If we look at COTI/USD on the weekly, we can see that the pair broke above channel resistance in March, hitting new all-time highs around $0.058 in mid-March before selling off. It has since broken its parabolic curve, much like FET, and is now trading back around the channel resistance breakout now potentially turned support. It failed to hold above $0.03 last week, but before I exit my position I am just monitoring what happens this week – as mentioned above regarding FET, it may be the case that alts begin to find strength if BTC forms a new range, and thus this consolidation may be significantly shorter than that of Q4 2020. However, if we close this week below last week’s low, I would expect to see the pair trade back into $0.15 before a bottom is found, where I would be looking to add to my position. Obviously, waiting for a weekly close below $0.023 renders the idea of exiting my position invalid, as we would be around 60% off the high at that point anyway, with the previous mini-cycle culminating in a 75% draw-down from $0.10 into $0.025 in November 2020, where a bottom was found. A 75% draw-down from $0.058 would see COTI at $0.15, exactly where I’d want to look to be a buyer again anyway, so I am comfortable with the draw-down at this point. I have mapped this out on the daily chart, with further confluence found at $0.15 in the form of the 200dMA. In short, I may well have to stomach another 45% relative drop from here in my COTI position if we do trade into $0.15, but I feel more comfortable in that as opposed to waking up post-exit to find that the BTC pair has reversed sharply like many BTC pairings are at the moment, thus hitting my targets without me on board and with no opportunity for re-entry.

Now, looking at COTI/BTC, again it looks quite similar to FET, having rejected a move above the August highs and now trading back around the March 2020 high at 450 satoshis, which is acting as support. If we look at the daily, we could see the pair trade back into the 200dMA around 330 satoshis, re-accumulate and then reverse for that third wave later this year, or we could see alts find strength much sooner, in which case I’d prefer to be on board…


Constellation:

DAG/USD

Weekly:

DAGUSDWeekly

Daily:

DAGUSDDaily

DAG/BTC

Weekly:

DAGBTCWeekly

Daily:

DAGBTCDaily

Price: $0.0734 (130 satoshis)

Market Cap: $91.103mn

Thoughts: Where other alts are currently failing to find strength in BTC’s sell-off, DAG looks poised to continue its ascent.

Looking at DAG/USD, from the weekly we can see that last week saw prior resistance turned support retested at $0.055 and hold firm, with price closing back at $0.073. That said, we are clearly range-bound, with several consecutive weekly closes below $0.08, which is acting as range resistance. I would like to see this range hold and for the pair to break out over the coming weeks, with a weekly close above $0.08 opening up more upside and new all-time highs into $0.125. However, if we do see this strength fail and $0.055 give way, I would be looking for a move back into $0.04, where I may look to add to my position.

Turning to DAG/BTC, from the weekly we can see that the pair is approaching an important area, where the parabolic curve of the current rally meets trendline resistance from 2019. If we see DAG break higher from here, I’d like to see a weekly close above the trendline, which I think would lead to acceleration into the 2020 high at 222 satoshis, where no doubt some resistance would be found. If, however, trendline resistance holds and prints a lower-high, we may see the pair return to the reclaimed support around 80 satoshis to be re-accumulated before another attempt at the trendline is made. Either way, I am holding my DAG given it is a low-cap position and one that I am expecting to ultimately clear the 2020 high at 285 satoshis before this macro cycle ends.

And that concludes this week’s Market Outlook.

I hope you’ve found some value in the read and thank you for supporting my work!

As ever, feel free to leave any comments or questions below, or email me directly at nik@altcointradershandbook.com.


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This Post Has 9 Comments

  1. Kacim Benaouda

    Hey Nik, big fan of your content. Any updates on a potential revised edition of your book?

    1. Nik

      Hey, it is shelved at the moment as I am just super busy with other stuff.

  2. Brandon Blake

    Thanks for all the info Nik. Any chance you could go into FRM for next week?

  3. HansD

    So very insightful, as always, thank you, Nik. Crazy times. With the retracement of VIDT as of late, and SC getting knocked back as well, would love to hear your thoughts on those and if you think they will still play as originally thought. Some other alts I wonder about are CRPT, KAT, and VSYS. BTW, your “Most Promising Alts of 2021” post from last October or so was true gold. If you ever get the desire for another of those specialty posts, that would be awesome. 🙂 Thanks again.

  4. martin vojkuvka

    Hello Nik,
    I like NEO at the moment
    what do you think?
    Thank you

  5. edotrader611

    Hey Nick, thanks as always for your analysis. Sorry to go a bit off topic but I would like to know what you think about VIDT at the moment, do you still have a position?

    1. Nik

      I’m still in my position and will include it in today’s post.

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