Market Outlook #136 (30th July 2021)
Hello, and welcome to the 136th instalment of my Market Outlook.
In this week’s Altcoin Special, I will be covering Chromia, OriginTrail, Polkastarter, Akropolis, PARSIQ, Verasity, xDai, Kadena and UREEQA.
Price: $0.31 (809 satoshis)
Market Cap: $134.801mn
Thoughts: If we begin by looking at CHR/USD, from the weekly chart we can see that the pair has recovered strongly over the past couple of weeks, initially closing back above support at $0.165 before rallying beyond trendline resistance from the all-time high into support turned resistance at $0.27. Subsequently, the pair broke beyond that resistance too and has pushed on towards the final level of resistance at $0.50 prior to the all-time high at $0.84. This week, we have seen some rejection just shy of this $0.50 area and price is returning towards what bulls should hope will hold as reclaimed support at $0.27. Hold above this level and I would expect to see $0.50 retested over the next couple of weeks, with any break above that level opening up a very high probability of an all-time high retest, given the lack of resistance between those two levels. If we drop into the daily, we can see that the pair found support at the 200dMA after breaking above trendline support, so bulls will want to see that area between $0.22 and $0.27 hold over the next week if it is retested. In fact, longs would be favourable in that area given the tight invalidation – a move back below $0.16 – with the primary target at $0.50. The bearish scenario from here is that this squeeze towards $0.50 is a macro lower-high, in which case we should see a swift breakdown back below the 200dMA and subsequently below $0.16, which would indicate that the pair wants much lower, in my opinion. First target below $0.16 would naturally be the support at $0.10, but if that gives way I can see this falling back towards $0.04 over the coming months.
Turning to CHR/BTC, as expected following the support that formed around 350 satoshis, the pair has gone on to push back above resistance turned support at 460, which became the trigger for the squeeze of the past couple of weeks. Price has since pushed back above the August 2020 high that had capped the pair on several attempts earlier this year, rallying into 1220 satoshis before rejecting this week and returning to the August 2020 high. For prolonged upside, it is vital this level holds, else this entire squeeze above 800 satoshis has been a deviation into a macro lower-high, and we would expect to see a full retrace back to 340 satoshis from here in that scenario. If the pair does holds above the August 2020 high, I can see further consolidation leading to another leg higher to new all-time highs above 1440. I have marked this out more clearly on the daily chart, for reference. Confluence at the 460-satoshi level would be the 200dMA, but I would actually expect the pair to break below that to retest the 340 satoshi area if we lose the August high – we can also see the 360dMA here, which would provide confluence for an entry, as any break below that cluster of support would lead to a retrace back to the initial breakout level of March 2021 at 180 satoshis.
Price: $0.24 (618 satoshis)
Market Cap: $85.768mn
Thoughts: Beginning with TRAC/USD, we can see on the weekly that the pair broke down below long-term trendline resistance (like much of the market) in May and has since been consolidating between support at $0.167 and reclaimed resistance around $0.38. This range has been holding for two months now, but price is printing lower-highs into local resistance. Until we see the weekly close back above $0.38, I would not be interested in holding any TRAC here, with that triple-bottom at $0.17 precariously positioned for another 50% of downside into $0.09 should it give way. That range between $0.063 and $0.09 would be where I would like to look for buys, personally, as there is long-term support sitting there. If we do break above $0.38, I’d expect to see another 30% squeeze into major resistance at the breakdown level ~$0.51. Above that, no doubt the pair will push for new all-time highs above $0.96. Dropping into the daily, we can see that where the 360dMA was initially acting as support, it is now acting as resistance, so a flip of that MA back into support would be the first sign that the pair is ready to squeeze higher.
Turning to TRAC/BTC, on the weekly, we can see that price is finding support above the historical level at 382 satoshis, which preceded the rally into the 2021 high at 1591 satoshis back in January. The pair is currently sitting on 526 satoshis as a triple-bottom, and I’d actually like to buy a sweep of these three lows into that 380 satoshi area for a bounce back towards at least 1191. If the support at 382 satoshis was to fall, I’d be looking at entering a long-term position all the way back inside the original accumulation range between 92 satoshis and 190 satoshis, as can be seen on the daily. At the moment, this doesn’t look particularly ready for upside, and if I don’t get that lower entry (either at 380 with a stop on a weekly close below the level, or much lower at 190), then I’d be waiting for a break back above 1000 satoshis, where there is significant confluence of resistance; close back above that and I think we push for new yearly highs.
Price: $1.10 (2840 satoshis)
Market Cap: $79.509mn
Thoughts: If we begin by looking at POLS/USD, we can see that price began by selling off shortly after inception from resistance at $0.90 into the eventual all-time low at $0.11, where price sharply reversed and began its first bull cycle. For several months, POLS continued to rally, eventually breaking above $0.90 and going parabolic into a new all-time high at $7.47 in late February 2021. Following that high, the pair began distribution, where support was found for a couple of months at $3.34 but eventually turned into resistance, collapsing in May and leading to a reversal of the entire move above $0.90, with support being flipped as resistance continuously. Now, the pair is sitting right back around $0.90, having found support at that historical resistance in June and recently swept the support into $0.80, where we can see price began to bounce once again. If we can see a range begin to form here around $0.90, this is absolutely something I’d be interested in buying, whereby $0.80 would act as invalidation and $1.60 will likely act as range resistance. In that scenario, I’d be looking at buying as close to $0.90 as possible to provide the tightest stop-loss, and I’d be looking to hold it for a new cycle, at least back up to the 200dMA if not higher. If $0.80 falls, I wouldn’t be interested in buying until $0.90 was then reclaimed or price returned to at least $0.32.
Turning to POLS/BTC, we can see that price has returned to the December 2020 high, above which price broke out and began to go parabolic earlier this year. Again, I’d either be looking for a range to form here between 2510 satoshis and 3400 satoshis for several weeks, or for price to return to the original range near the all-time low, with range resistance turned support down at 1700 satoshis. I’ll be returning to this one in a couple of weeks to see how it has developed, but certainly one to keep an eye on.
Price: $0.02 (53 satoshis)
Market Cap: $63.699mn
Thoughts: Looking at AKRO/USD, we can see from the weekly that price began with a multi-month downtrend back in 2019 before finding an all-time low at $0.0005 early in 2020 and begin its macro bull trend. From there, the pair rallied to the then-all-time-high at $0.05, where it found resistance in August 2020, retraced 86% to historical resistance turned support at $0.0075 and then began a second leg higher into $0.128, which remains the all-time high to this day. Since that high formed, price has retraced 98%, back towards the accumulation range that preceded the previous leg higher, with support being found between $0.0134 and $0.0175. Range resistance at present is $0.024. This is certainly an area I am interested in rebuying my sold AKRO, with a view to hold for a third leg higher should it come, particularly after an 89% drawdown from the high. Further, invalidation for buying in this range would be a weekly close below $0.0134, at which point I’d expect to see AKRO come back to the November 2020 low at $0.0073 – and if that low gave way, we’d be looking at a full retrace of the bull market back to support at $0.0011. Looking at the daily, the pair actually doesn’t look too dissimilar from TRAC/USD, but the reason why it is more attractive is the BTC pair, which is sitting at significant support (which we shall get to next). Here, we can see the range has been held for around 10 weeks at this point, where the range that preceded the second leg higher lasted around 17 weeks. That said, I am going to begin to dollar cost average into an AKRO position here in anticipation of this range holding for a little while longer, expecting an upside breakout to follow, with a stop-loss on a close below $0.0134 and looking for at least $0.05. More risk averse speculators might consider awaiting a breakout above $0.24 and the 360dMA before entering a position.
Turning to AKRO/BTC, we can see from the weekly that the pair is beginning to form a tight consolidation range above historical range resistance now turned support at 43 satoshis. This is why I am leaning more bullish for AKRO than I am for TRAC – the BTC pair is much closer in proximity to the historical accumulation range, which is exactly where I like to buy. In fact, looking at the daily, I’d be willing to buy this support and exit swiftly on a breakdown below 43 satoshis, then rebuying a long-term position as we get closer to 25 satoshis, potentially as low as the all-time low at 6 satoshis. Alternatively, we could wait for a breakout above local resistance at 72 satoshis, where the 200dMA sits, and again set an invalidation at 43 satoshis, then looking for a rally into 160 satoshis at the very least.
Price: $0.52 (1329 satoshis)
Market Cap: $60.787mn
Thoughts: Beginning with PRQ/USD, we can see here that much like POLS the pair rallied throughout Q1 2021, moving off the all-time low at $0.069 into a new all-time high at $2.69 in mid-April. That said, significant resistance had been found between $1.75 and $1.94 for the entirety of Q1 prior to the move into $2.69, and as May approach that level was reclaimed as resistance, with the pair printing a complacency shoulder and confirming the all-time high breakout as a deviation above this level. Since, the pair has retraced much of its bull cycle, breaking below the 200dMA (now resistance) in mid-May and bleeding towards prior resistance potentially turned support at $0.25. PRQ initially found support at $0.45 in May after capitulation and following the brief dip below $0.33 the pair has reversed sharply, breaking above trendline resistance and back above $0.45. If it can hold above that level here, reclaiming it as support, I’d expect to see continuation higher towards $0.82. If we fall back below the level, I’d be looking to be a buyer at $0.25, dollar cost averaging down all the way into $0.11, which was the range that preceded the bull run.
Turning to PRQ/BTC, the pair is currently capped by trendline resistance from the complacency shoulder at 4343 satoshis, but is finding support around yearly lows ~1123 satoshis. If a new range begins to form above this support, that is something I’d be interested in buying, but if we lose 1100 I’d be expecting a move back towards strong support around 600 satoshis, which is where I’d prefer to be a long-term buyer. Assuming I get neither of those entries, I’d actually be happy to be a buyer on a break back above 1722, looking to play it back towards the 200dMA and major resistance at 2725 satoshis.
Price: $0.01 (27 satoshis)
Market Cap: $44.28mn
Thoughts: Beginning with VRA/USD, from the weekly I can tell you that this is not yet something I am willing to re-enter a position in following the major bull run of 2021. Despite support having been found around $0.01, the pair is still capped by trendline resistance and is largely in no man’s land relative to price-history, with the next major support all the way down at $0.0035, followed by the area I’d really like to re-enter a long term position: the original accumulation area at $0.0017. Now, I don’t know if it will get back down there any time soon, but unless I see those levels traded, the only way I am entering a position here is on a breakout above trendline resistance on good volume – I’d then look to buy a retest as support to hold into resistance at $0.0245.
Turning to VRA/BTC, the pair still looks like it is in the middle of its bear cycle, where I would expect to see anger and depression follow on a breakdown below support here at 26 satoshis, with price likely to bleed into 14-17 satoshis in that scenario and potentially begin flattening out and beginning a new range at or below those levels. That is what I’d look for before buying – anything else currently just looks like another opportunity for a lower-high to form in a longer-term bear cycle.
Price: $6.54 (16,860 satoshis)
Market Cap: $38.784mn
Thoughts: Beginning with STAKE/USD, the pair managed to sweep the $41.45 all-time high from August 2020 into $42.66 in February but rejected at that resistance, then printing a lower-high in April and subsequently losing 200dMA support at $16.40 in May, below which the pair capitulated all the way back into November 2020 range support at $6.86. The pair briefly popped below that support into resistance from July 2020 at $4.97 but has reversed back towards the breakdown area since. Following an 88% drawdown from the all-time high, I am very much interested in being a STAKE buyer here if we can climb back above $7 and confirm the move into $4.96 as a deviation below cyclical support. That would be my entry trigger and thus my invalidation would be a move below $4.96, with a first target of $16.40 and a second target of $29.77, with a final target of the $42 all-time high / range resistance. Alternatively, if November 2020 support turns resistance here and we move below $4.96, I’d be waiting for another 60%+ drop back towards the original accumulation range around $2.22, where I would certainly begin a long-term position, dollar costs averaging back towards the all-time low should it come.
Turning to STAKE/BTC, this chart is beautiful for confluence with the USD pair, as it appears we are right in the vicinity of where we’d expect cyclical bottoms to form on both pairs, with STAKE having retraced 95.4% from its all-time high in August 2020 at 0.00347. It has since returned back inside the original accumulation range from June to July 2020 between the al-time low at 11.2k satoshis and 24.5k satoshis, with the pair currently sat right around mid-range at 17k satoshis. If we do see that $7 area reclaimed on the dollar pair, I am very much happy to be a buyer inside this range with a stop-loss on a close below the all-time low.
Price: $0.33 (850 satoshis)
Market Cap: $44.074mn
Thoughts: Beginning with KDA/USD, we can see here that the pair has played out one full bull cycle and is now in the midst of what might be considered its second bear cycle, where the first took the pair into its all-time low at $0.11 in January. Following that low, KDA rallied for a few months into an all-time high at $1.90, printed a complacency shoulder at $1.82 and has since bled back towards the original accumulation range, though it currently sits above it at minor support ~$0.30. I would honestly much prefer to wait for the pair to bleed further into the historical support (and range resistance from December 2020) at $0.23, which would be where I begin buying a long-term position, dollar cost averaging back towards the all-time low should it come. If I don’t get that buying opportunity, I’d be looking for a new range to form here above $0.30 and begin buying that in a few weeks time. If we simply bounce here and begin another leg higher, I’d rather sit it out to be honest.
Turning to KDA/BTC, we can see that price was finding support around the 200dMA and above historical range resistance at 926 satoshis but this has since give way and become resistance once again. The pair is now sitting with no major support all the way into the all-time low at 336 satoshis so I am definitely going to be waiting this one to see how the price-action develops in August. I’d like to see the pair continue to bleed towards the all-time low and buy as close to it as I possibly can, holding for the long term.
Price: $0.26 (676 satoshis)
Market Cap: $1.083mn
Thoughts: I may have saved the best for last, as I am very much going to be filling a position in URQA over the next couple of weeks.
Looking firstly at URQA/USD, we can see that the pair has been in a downtrend from inception, printing an all-time high around launch at $7.65 and then bleeding for months into the all-time low at $0.135 in mid-June. The pair retraced over 98% from that all-time into the all-time low, which is the first promising sign, as those post-presale buyers have now without doubt capitulated. We have now formed a tight accumulation range above the all-time low, with support found at $0.16 and range resistance at $0.26. To confirm that this is indeed an accumulation range, I checked the rich-list, and the entirety of top 25 individual holders are either buying or holding here. As such, I am also going to be buying whilst price is inside this range, which I would expect to last for some while longer. Given the low liquidity at the $1.1mn market cap, I am going to be partial filling, attempting to get as close to a $0.17 entry as possible, with a manual exit if we lose the all-time low.
Turning to URQA/BTC, again this chart is near-picture-perfect, with a 43-day range having formed between the all-time low / range support at 440 satoshis and resistance at 745 satoshis. This is definitely the range in which I want to be a long-term buyer, looking to hold for UREEQA’s first major bull cycle – this might well be several months from now but as long as we hold this range and don’t begin to break down below it and begin bearish price discovery I am willing to hold. If we do see a breakdown below the range, I’d look for a reclaim of the range to re-enter or for a new range to form lower down. My targets for this position begin at 3500 satoshis and go all the way into new all-time highs.
And that concludes this week’s Market Outlook.
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