Market Outlook #129 (15th June 2021)
Hello, and welcome to the 129th instalment of my Market Outlook.
In this week’s post, I will be covering Bitcoin, Ethereum, Binance Coin, Cosmos, Solana, Swipe, Siacoin, AirSwap, Mithril and Komodo.
Bitcoin:
Weekly:
Daily:
Price: $40,414
Market Cap: $746.384bn
Thoughts: Beginning with the weekly chart for BTC/USD, we can see that last week printed inside week failure and price has already taken out the inside week high, as expected. Whilst we began the week with a sell-off, after taking out both the previous week’s low and the low preceding that one, price bounced off trendline support, reversed and closed back inside the prior weekly range at weekly highs ~$39k. Volume improved upon the previous week and I now think we are ready for that squeeze higher that I have been anticipating since the $30k low formed. That said, there is still major overhead resistance at $42k, which is the range resistance that capped price back at the beginning of the year. If BTC can begin closing on the lower timeframes above that resistance cluster, I think we are likely to see a pop towards the $47k area, where prior support will likely act as resistance.
Dropping into the daily, we can see the current range more clearly, with last week’s low printing a swing-failure of $31.1k and $33.3k. This acted as a strong reversal area, with price then pushing back into the monthly open and closing right at the level ~$37.3k. All week, that monthly open became the battleground, as price found resistance there for three successive days before putting in a higher low above $34k and closing firmly above $37.3k during the weekend. Since, the pair has pushed on, breaking and closing above the swing-high at $39.6k, thus printing the first higher-high on the daily since the $30k low. This is promising, but we still have a cluster of resistance levels overhead between $41-42.5k, with the latter being the 200dMA. If we see this push continue, I’d be looking for $42k to be flipped as support, with a subsequent higher-low opening up the likelihood of a move into the highlighted box over the next couple of weeks. If we look at fib levels, the first key level will be the 50% retracement at $44.8k, but there aren’t really any key levels in that area and so I would expect price to push towards the 61.8%, which aligns more closely with the April low. Any move into that area will be used to hedge exposure and sell some spot on my part, with the possibility of a macro lower high forming below that trendline resistance from $64.9k. The bearish scenario here is of course that this squeeze fails to break range resistance at $42k, with any swing-failure of the cluster of highs in that region opening up the possibility of a return to the monthly open at $37.3k.
Ethereum:
ETH/USD
Weekly:
Daily:
ETH/BTC
Weekly:
Daily:
Price: $2598 (0.0642 BTC)
Market Cap: $298.395bn
Thoughts: Despite ETH/BTC having a mini-meltdown this past week, all-in-all both pairs still look better than BTC/USD.
If we begin with ETH/USD, we can see from the weekly that price continues to consolidate below $2913 but last week confirmed inside week failure, with that level now likely to be taken out over the coming days. Whilst $2050 continues to hold as support, I see no reason not to expect continuation higher in ETH/USD from here, but I am looking for a weekly close above $2913. If we look at the daily chart, we can see the inside week high at $2890, with price having taken out the $2275 low last week and bounced. As long as that low now holds, I’d expect $2890 to follow, with any daily close above there opening up the likelihood of a squeeze into $3270. If we lose $2275, I’d consider the inside week failure invalidated and begin looking for intraday shorts into support at $2050, where I would like to see a higher low form. For now, however, the picture looks promising, and I’d consider any move above the capitulation candle high $3350 to be a signal that all-time highs are going to be retested.
Looking at ETH/BTC, I first want to briefly address why I (and many others) consider the EIP-1559 event to be a bullish catalyst for Ethereum, as requested by a subscriber. Effectively, the event will begin a transition to fee-burning for transactions on ETH, thereby providing deflationary pressures on supply. One of the primary issues that many people have with ETH is its lack of transparent and verifiable finite supply, but with the introduction of EIP-1559 the network has the potential to become entirely deflationary, given the expected growth of the usage of the network across all use cases outweighing inflation. Now, beginning with the weekly chart, whilst last week was not pretty, in the grand scheme of things, the pair is simply range-bound within the original sell-off candle from the 2021 high, with the previous three weeks of price-action occurring inside its range. Further, we can see that prior channel resistance is now acting as support, and as long as ETH/BTC can hold above it, I see no reason to expect any further downside from here. However, trade back inside the channel and it is likely we retest the recent low at 0.055 as support, with any close below that turning market structure bearish and likely leading to a deeper retracement into 0.046 or potentially 0.0407 where the 200wMA is sitting. Whilst structure is bullish, however, I continue to expect that 0.083 high to get taken out over the coming weeks, with 0.105 my primary target above. If we look at the daily, the lower high at 0.078 did lead to a sell-off back into support around 0.062 but this area seems to be holding, and I am looking closely at 0.06 for signs of weakness; close the daily below that (which we did not do on the first sell-off in May) and I would become more concerned about short-term bullishness. Until then, it looks like price is simply flagging after a rally, with any break above 0.078 now the catalyst for continuation.
Binance Coin:
BNB/USD
Weekly:
Daily:
BNB/BTC
Weekly:
Daily:
Price: $376.19 (0.0093 BTC)
Market Cap: $57.579bn
Thoughts: Beginning with the weekly chart for BNB/USD, we can see similar price-action to other large-caps, albeit with no weekly market structure break as of yet, given that BNB did not take the time to form any swing-lows on this timeframe during its rally into $707. However, we do now have the swing-low at $210 as key support following May capitulation, and whilst that low holds I do expect a squeeze higher to follow, with a potential complacency shoulder to come if the pair forms a lower-high below $707 over the next few weeks. The past three weeks – like everything else – have been periods of consolidation, but any move above $436 will open up the likelihood of further upside and a potential retest of that all-time high. Looking at the daily, the structure is quite clean, with higher-lows and higher-highs forming following the $210 low at the 200dMA. If the pair can push on from here above $436, I’d expect the capitulation candle high to be tested at $517, where the 61.8% retracement lies. This would be where I would expect a lower-high to begin forming, with any daily market structure breakdown from up there acting as an early indicator of a cyclical top. If, however, the pair finds resistance in that area and forms a higher low above $436, we may well be on the cusp of an all-time high retest, a failed break or sweep of which would also mark a potential cyclical top.
Looking at BNB/BTC, again, like ETH/BTC we have a lower-high but price-action consolidating within the larger range of the sell-off candle in May. We also have no break in market structure whilst 0.00655 holds as support; lose that level and it is game over for Binance Coin, in my opinion, with a potential unwind of the entire rally to follow if the cycle is over, but at the very least a retest of the prior ATH at 0.0048. However, the level is holding for now, and I’d expect continuation above the all-time high to follow if ETH/BTC begins breaking above its yearly high. Dropping into the daily, I am looking for a higher-low to form above 0.008 to precede a push higher above 0.011. Close above that and all-time highs will get taken out.
Cosmos:
ATOM/USD
Weekly:
Daily:
ATOM/BTC
Weekly:
Daily:
Price: $13.39 (33,130 satoshis)
Market Cap: $2.822bn
Thoughts: Looking firstly at ATOM/USD, we can see that price found resistance at prior support ~$16.26 and sold off into prior resistance at $10.55, which held firm last week. Overall, the pair is range-bound between these two levels but is also holding above year-long trendline support. I am looking for a weekly close below $10.55 and the trendline to signal a longer-term shift in trend, with a retracement towards the prior accumulation range high around $6.40 likely in that scenario. Until then, I am bullish here, with $23.20 looking primed as an area for a short-squeeze. If we look at the daily, we can more clearly see how the pair is sandwiched between the 360dMA as support and the 200dMA as resistance, though it did break and close above it a week ago as it put in a higher-high at $17.70. Hold here above $11 and I think we see $17.70 flipped, with a squeeze into the 50% retracement and origin of the breakdown ~$20.73 likely. Close above that and I am looking at $23.20.
Turning to ATOM/BTC, as mentioned a couple of weeks ago, key support continues to hold at 30.7k satoshis, and whilst that holds I think we continue to play the range between there and 47k satoshis, with any close above that likely to lead to a retest of major resistance at 55.5k satoshis. Close below 30k for the first time in months and I would expect the May low at support ~25.6k to be retested, with any break below that opening up the possibility of an all-time low retest at 14.5k satoshis. Looking at the daily, we can see how choppy this pair is, but just keep in mind the range: 30.7k satoshis has held as support since March and 55k has held as resistance for over half a year. Whilst we are inside those two levels, expect further chop; break either side of the range and we may well know our direction for the foreseeable future.
Solana:
SOL/USD
Daily:
SOL/BTC
Daily:
Price: $40.93 (0.00101 BTC)
Market Cap: $11.132bn
Thoughts: Looking at SOL/USD, we can see that price found support at prior resistance ~$18.73 during May capitulation and has since been putting in higher highs and higher lows, with resistance at $44.63 now capping the pair, just above the 61.8% retracement of the entire dump from the all-time high. The key level for me above, however, is $50, which acted as resistance for two weeks before the push to new all-time highs at $57.58; if that area is rejected as resistance, I’d be bearish on SOL, looking for shorts back towards the 200dMA. If $50 is flipped, however, not only would I expect the all-time high to be broken but I’d be looking for trend continuation towards the 1.618 extension at $82.47. Looking below, if the pair loses $33.78, where the current higher-low is, I’d expect $24.63 to be retested as support; lose that and I think we see the May low taken out.
Turning to SOL/BTC, the pair looks much better at the moment, having already flipped prior resistance at 0.001 as support, which was the range high that preceded the move into the all-time high at 0.00137. The fact that we are forming a higher-low here after pushing towards that all-time high indicates that SOL/BTC is ready for a breakout, and as long as this area holds above 90k satoshis I would be expecting 0.00137 to be taken out. If we get a daily close above that all-time high, the 1.618 extension at 0.00185 awaits. If, however, 90k satoshis does not hold here, I’d expect a return to support at 71.7k satoshis, but that would begin looking like rejection at all-time highs and thus complacency.
Swipe:
SXP/USD
Weekly:
Daily:
SXP/BTC
Weekly:
Daily:
Price: $2.09 (5172 satoshis)
Market Cap: $198.936mn
Thoughts: Beginning with SXP/USD, we see a similar pattern to most, with three weeks of consolidation subsequent to the sell-off into support at $1.31. Last week confirmed inside week failure and I’d now expect price to push towards $2.56 from here. Much like ATOM, SXP/USD has held its trendline support since March 2020 and so there is a possibility that this most recent capitulation is simply the correction required before a third and likely final leg higher beyond the all-time highs. However, firstly we need to see a weekly close above $2.56 to open up a larger squeeze into $4.23, where the 61.8% retracement and capitulation candle high sit. If we start to form a higher-low on the weekly following a move into that area, I’d begin considering the likelihood of trend continuation towards $6 and beyond to the 1.618 extension at $8.95. If we look at the daily, we can see that reclaiming $2.56 would also flip the 200dMA as support, which I would like to see hold if it is reclaimed, much like it did in February. If, however, we fail to break cleanly above that area, I’d expect a return to trendline support. Lose that and the $1.31 swing-low and it is game over for Swipe for this cycle, in my opinion.
Turning to SXP/BTC, the pair is consolidating above support at 4735 satoshis, having found resistance just shy of 10k. Whilst this support holds – support, I might add, that preceded the run to the all-time high at 43.7k satoshis – I see no reason to be overly bearish on Swipe; close below it and I think we see 3100 satoshis retested and potentially new all-time lows, however. If we look at the daily, we can see that price is also consolidating around the 200dMA, with the 360dMA acting as range resistance; again, much like ATOM/BTC, this range has been in play for months on this pair and so I am watching for a break of either side to indicate where we may be headed over the mid-term. If the pair can return to rang e resistance at 10k satoshis and close above it, I’d expect continuation towards 23.6k satoshis, with minor resistance at 12.3k.
Siacoin:
SC/USD
Weekly:
Daily:
SC/BTC
Weekly:
Daily:
Price: $0.016 (40 satoshis)
Market Cap: $779.352mn
Thoughts: Beginning with SC/USD, we can see that price has returned to prior resistance now turned support at $0.0147, having broken down following the yearly high at $0.064. The parabola into that high has of course been broken, but the pair remains well above trendline support from March 2020, and it may be the case that a longer period of re-accumulation is required before another leg higher can occur. As long as the pair continues to hold above $0.0147 here, I’d expect the new range to form with that level as support, looking at $0.022 as range resistance. Break above $0.022 and I think we see a squeeze into $0.03, which is prior resistance. Only if that level is flipped on the weekly would I expect to see continuation towards the yearly high, so I will be looking to sell much of my Siacoin position at $0.03 if we get it, rebuying on a weekly flip. I am considering the scenario in which we squeeze higher from here into that area, form a lower-high and return to the trendline later this year to re-accumulate before a final blow-off top in Q4 or potentially Q1 2022. Looking at the daily, one promising thing to take away despite the brutal sell-off is that the 360dMA remains support and price is also holding higher around the 200dMA, although it was the former that held up the trend after the previous correction – as such, whilst that holds, I think we have a chance at trend continuation later this year.
Looking now at SC/BTC, the thing here that makes me think we have yet to see the blow-off top for Siacoin is how little price has moved from the multi-year range since the breakout, with price failing at the 200wMA and now returning to range resistance at 45 satoshis, around which price is consolidating. If we look at the daily, I have highlighted a potential scenario in which we chop around this range resistance and above the 200dMA for several weeks before continuing higher. However, lose 29 satoshis and I would expect the range lows at 16 satoshis to be retested. For bulls, breaking higher from here and turning market structure bullish (higher high above 55 satoshis) would be promising, with a retest of the 80-satoshi lower-high likely in that case.
AirSwap:
AST/USD
Weekly:
Daily:
AST/BTC
Weekly:
Daily:
Price: $0.15 (375 satoshis)
Market Cap: $22.773mn
Thoughts: Beginning with AST/USD, we can see that May capitulation caused a breakdown below trendline support from March 2020, which is now acting as resistance. However, the pair is chopping around an important are of historical support at $0.17, which, if it can reclaim, would open up the likelihood of a push higher into prior resistance at $0.34. If we look at the daily, the pair has broken below the 360dMA, which it did also do briefly during the Q4 2020 correction. If the pair can hold this higher low at $0.127 and make a higher-high back above the 360dMA and trendline support, I’d expect a retest of $0.27 to follow; close above that and we will see a pop into $0.34, where there is major resistance. In the scenario that AirSwap can clear both trendline resistance from the yearly high and the $0.34 level, I’d expect another leg higher to follow beyond $0.80. However, fail around $0.34 or lower and then lose the 360dMA again and I think the cycle is done, with $0.05 the next major support below.
Turning to AST/BTC, the pair looks flat-lined, having barely run this year but having rallied from the all-time low at 140 satoshis to 2750 in August 2020. From the daily, we can see that the run into 1345 in March ended up being a macro lower-high, with price having lost the 360dMA since and now being capped by trendline resistance, with lower-lows following each week. If support here at 375 fails to hold, there is no support all the way back into the all-time low at 140 satoshis. This is not one I’d be looking to buy or hold at present…
Mithril:
MITH/USD
Weekly:
Daily:
MITH/BTC
Weekly:
Daily:
Price: $0.056 (140 satoshis)
Market Cap: $56.492mn
Thoughts: If we look firstly at MITH/USD, we can see from the weekly that the parabolic curve is just about intact, but the pair has broken weekly market structure and put in a third lower-high at resistance $0.09 last week. If the parabola is to hold, we would expect to see another push higher to retest $0.09 this week, with a weekly reclaim of the level opening up the possibility of continuation towards the yearly high at $0.21 and the all-time high at $0.265 beyond it. If, however, the pair fails to break back above that level and loses the parabola, I would expect further chop between $0.059 as resistance and support at $0.031. Break and close below $0.031 and the cycle is undoubtedly done, with a return to $0.006 on the cards. Looking at the daily, we can see that trendline resistance from the yearly high is capping price, so a breakout above there would be the catalyst for a trend shift. It is promising for bulls that the 200dMA is holding firm as support and that price has put in a higher-low and higher-high since capitulation into the 360dMA at $0.025. As I said, that cluster of resistance at $0.09 is key – close above that and I think MITH bulls see some continuation.
Turning to MITH/BTC, this chart looks not too dissimilar from other 2018 coin charts, with the weekly showing a series of lower-highs following the breakout and rally off the range support at 38 satoshis. Following last week’s close, the pair looks more bearish than its USD counterpart and looks ready for a lower-low below 82, which would suggest that MITH/USD is going to break down rather than out. If we drop into the daily, the support between 75-82 satoshis aligns with the 360dMA and it is key that area holds if MITH is to have any chance at trend continuation. Lose it and I think the bottom falls out on both pairs.
Komodo:
KMD/USD
Weekly:
Daily:
KMD/BTC
Weekly:
Daily:
Price: $1.14 (2813 satoshis)
Market Cap: $143.36mn
Thoughts: Beginning with KMD/USD, we can see from the weekly that the pair rallied into a yearly high at $4.83, breaking out beyond prior resistance at $2.05 that had held for years. Since, the pair has put in a lower high and broken down, reclaiming $2 as resistance but now returning to the original breakout point and potential reclaimed support at $0.88. This looks like a good area for a new base to form if KMD is to get a second leg higher later this year. For bulls, you want to see $2.05 reclaimed as support once again as the trigger for continuation to new yearly highs, with the all-time high weekly close at $11 the primary target in that scenario. If, however, this support at $0.88 doesn’t hold, the next support is almost 50% lower at $0.45.
Turning to KMD/BTC, this pair doesn’t look too attracting, having found support at the beginning of the year at 1350 satoshis following three years of downtrend only to rally above resistance at 5k, reject and break back below it, with it now acting as resistance once again. That said, if we return to the support area at 1350, I’d look to be a buyer long-term, but that would also suggest a return to $0.45 on the dollar pair, assuming no drastic change in BTC/USD, so perhaps it is unlikely we see that level retested. Instead, what is likely is that new structure forms in this area above reclaimed support at 2500 satoshis, as seen on the daily chart. Lose that and we may well be headed for the depths…
And that concludes this week’s Market Outlook.
I hope you’ve found 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.
