Market Outlook #153 (15th November 2021)
Hello, and welcome to the 153rd instalment of my Market Outlook.
In this week’s post, I will be covering Bitcoin, Ethereum, Avalanche, Chainlink, Cosmos, Kadena, SushiSwap, Chromia and BakeryToken. I’ll also be providing updated analysis on Altcoin Market Cap.
As ever, if you have any requests for next week’s Outlook, please do let me know.
Bitcoin:
Weekly:
Daily:
Price: $66,030
Market Cap: $1.246trn
Thoughts: Beginning with BTC/USD, we can see from the weekly that price rallied to a new all-time high at $69,000 last week, breaking beyond the previous high at $67,000 but ultimately closing week back below that high. That being said, the pair printed another all-time high weekly close at $65,500, closing firmly through the April high at $64.9k for the first time. Given the wick through $67k and close back inside, we could look at this as another weekly swing-failure, which would suggest downside to follow and a failed breakout, but we do have conflicting signals here with the strong weekly close beyond $65k. Further, if we were sitting up near $80k+ having rallied off this breakout for a few weeks and then printed this sort of swing failure pattern, I’d be more concerned about an interim top being in and would be looking to scale out. As it is, we are still sitting above the April highs having just closed above the level, so as long as we can now begin to find support above $64.9k I don’t think this SFP is going to play out as straightforward as it looks. If however I am wrong and this is a textbook bearish setup that plays out as such, I would expect to see $64.9k lost and retested as resistance early this week and price then breakdown below local trendline support, which can be seen on the daily timeframe. From there, I’d expect to see an entire retrace of the breakout range back into $57k, where I would look to buy a wick below that level into trendline support above $53k for continuation higher. If the pair is able to hold above $64.9k early this week, I think we continue to consolidate higher and then begin parabolic price-action when $70k is taken out, with $73k and $76.7k as minor resistance levels on the way to $87k.
Ethereum:
ETH/USD
Weekly:
Daily:
ETH/BTC
Weekly:
Daily:
Price: $4724 (0.07166 BTC)
Market Cap: $558.264bn
Thoughts: Looking firstly at ETH/USD, from the weekly timeframe we can see that another all-time high formed last week at $4867 but price rejected and closed the week back near $4625. This occurred on declining volume for the third week, with the weekly range also contracting, indicating that a period of higher volatility is likely imminent. The pair is still firmly above prior all-time highs at $4385 and long-term trendline support, so I don’t feel the need to position defensively here, but if we begin to close back below $3950 and thus break down below trendline support over the next few weeks I would shift my positioning drastically. Until then, I think it is likely the pair continues to grind higher. Dropping into the daily, we can see that price has been wicking below prior resistance at $4627 into $4450 but failing to close below it on several attempts, confirming $4627 as a new area of support that should act as the base for another leg higher this week. If this level fails and begins to act as resistance, I think we see the prior ATH retested at $4385, with any wick below and close back above that level the bottom signal. If we continue to hold above $4627 as we are at present, I am looking for $5000 to be tagged this week.
Turning to ETH/BTC, the pair is still hovering below trendline resistance and the high at 0.075 remains a lower high at present, but the prior resistance zone between 0.069 and 0.0712 is holding as support, which is promising. I would like to see this area continue to hold this week and for price to break higher beyond 0.075, signalling the end of this consolidation period and a move towards new yearly highs. Looking at the daily, we are still chopping around this zone and it may be that we need a wick below 0.069 into the 200dMA and a strong buy-back from there to print the higher-low that is required for another push higher, through trendline resistance, so I would pay attention to the lower timeframes this week for signs of reversal if price comes into that area. Looking ahead, a daily close above trendline resistance and I will be adding more spot ETH for another leg higher beyond 0.086.
Avalanche:
AVAX/USD
Weekly:
Daily:
AVAX/BTC
Weekly:
Daily:
Price: $97.86 (0.00148 BTC)
Market Cap: $21.557bn
Thoughts: Beginning with AVAX/USD, we can see from the weekly that the pair closed through prior all-time highs at $83 last week, flipping the level as new support and rallying into a new high around $100, below which it is currently sitting, with the 1.618 extension of the trend just ahead at $109.31. I expect to see AVAX continue to outperform from here given the strong weekly close on rising volume, with the 200% extension at $133 a good area to hedge long exposure, in my opinion. Looking at the daily, we can see that local trendline support from $30 is continuing to push the pair higher, with price now moving off the trendline as the prior ATH was flipped, suggesting that the rally is becoming parabolic. Daily RSI is sitting just below overbought conditions but well below the extremely overbought conditions of August, and momentum is kicking in here. If we see $100 broken and closed above, I think we see another rally like the August rally towards $133 and potentially the 2.618 extension at $172.
Turning to AVAX/BTC, we can see that the pair is still sitting below resistance at 0.00155, which is the key level to close beyond for the pair to kick on towards and beyond the all-time high at 0.0018. If we can see a weekly close above it, I think that will drive the BTC pair into price discovery, which in turn will drive AVAX/USD towards those targets mentioned previously. Whilst we remain below 0.00155, the Dollar pair will just grind up as BTC/USD grinds higher, so flipping that level is the key signal for more significant outperformance. The broader pattern here is also that of an ascending triangle, and hat could continue to play out for weeks if we reject here again and move lower towards the trendline, so it is something to keep an eye on if you are heavily positioned in AVAX here. Looking at the daily, we can see that the pair is printing a parabolic rally off the higher low at 86.5k satoshis, which, if it holds, would see new all-time highs by December.
Chainlink:
LINK/USD
Weekly:
Daily:
LINK/BTC
Weekly:
Daily:
Price: $34.23 (51,888 satoshis)
Market Cap: $15.888bn
Thoughts: Looking firstly at LINK/USD, from the weekly we can see that the pair has been grinding higher since Q3, with last week pushing the pair beyond resistance at $36 into the 61.8% retracement at $38.40. Despite the rally, the pair rejected at that high and closed back near the 50% retracement at $33.59. This suggests that LINK is not yet ready for that breakout beyond reclaimed resistance at $38.40, which will be the catalyst for the next leg higher into the 78.6% retracement at $45.33. For now, I think it is likely the pair continues to chop and consolidate whilst grinding higher, and it is the BTC pair we need to pay attention to for signs of a longer-term reversal.
If we look at the BTC pair, we can see that price has been capped by trendline resistance since May, leading to the lower high at 70.7k satoshis and the most recent lower high below resistance at 57k satoshis. Whilst the pair continues to print lower-highs below this trendline, I am in no rush to position long LINK, particularly given the breakdown below 44.5k satoshis a few weeks ago, leading to a lower-low after a series of higher-lows throughout 2021. If the pair can reverse this trend here with a higher-low above 40k satoshis and then a breakout beyond the trendline, reclaiming 60.6k satoshis as support, I would begin to look at that as a longer-term bottom.
Cosmos:
ATOM/USD
Weekly:
Daily:
ATOM/BTC
Weekly:
Daily:
Price: $33.28 (50,260 satoshis)
Market Cap: $7.455bn
Thoughts: Beginning with ATOM/USD, we can see from the weekly that the pair continues to consolidate in a range between the prior all-time highs now turned support at $27.85 and resistance at the current all-time high at $47.10. We remain firmly above long-term trendline support and the pair simply appears to be re-accumulating above prior highs before another leg higher. If we drop into the daily, we can see that each move lower into $27.85 has led to a push beyond the mid-range at $37.78 into range resistance, thus this area is not a bad spot to begin increasing exposure to ATOM if you are not exposed, with tight invalidation below that $28 area. The expectation here is that we see $47.45 give way to another leg higher into the 1.618 extension at $59.40, where I will be looking to reduce exposure.
Turning to ATOM/BTC, we can see that the breakout area at 56k satoshis has been lost here as price turned prior support into resistance at 72k satoshis, leading to a breakdown below 56k into 47.3k satoshis. The pair is now sitting just above the 78.6% retracement area at 43.5k satoshis, which you would want to see hold as a higher low here, given the expansion beyond this range throughout August and September. If we drop into the daily, the pair is also sitting on the 200dMA, providing confluence for a bottoming zone for the pair, with the 360dMA just below at 39.1k satoshis. If we do form a higher-low here, I would want to see a strong trendline breakout and reclaim of 55.3k satoshis, which I would expect to lead to that price discovery discussed on the Dollar pair.
Kadena:
KDA/USD
Daily:
KDA/BTC
Daily:
Price: $21.65 (32,830 satoshis)
Market Cap: $3.408bn
Thoughts: Beginning with KDA/USD, we can see from the daily that the pair is in a parabolic rally at present, having broken through prior all-time highs turned support at $1.91 in October and since rallied sharply for several weeks into the 1500% extension of the long-term trend at $27, above which the pair wicked into an all-time high at $27.91 a few days ago. Naturally, this is not price-action you want to be buying into, as there has been very little support formed on the way up, with a steepening curve to the rally. Rather, Kadena holders should be looking to sell into this rally, reducing exposure at each new significant fib extension hit, with a full exit on a breakdown below this current steep trendline support, with the next major support back down at $12.66. The next target above if this rally sustains is the 2000% extension at $35.85.
Turning to KDA/BTC, the chart looks almost identical, except with a slightly less steep curve to the rally, given that the Dollar pair’s rally has been compounded by the rally in BTC/USD. Looking at the trend-based fibs here, we could expect another push higher from here into the 1.618 extension at 71.15k satoshis if the rally holds up. If we start to break down here, the next major support is down at 20k satoshis, below which the pair begins to look like it has topped out for the cycle. That said, it doesn’t look quite ready to top out yet, but as I mentioned in the previous section, this is absolutely not an area to get involved if you are on the sidelines but rather an area to reduce exposure significantly.
Sushiswap:
SUSHI/USD
Daily:
SUSHI/BTC
Daily:
Price: $10.93 (16,610 satoshis)
Market Cap: $1.386bn
Thoughts: Beginning with SUSHI/USD, we continue to see the pair consolidate between support at $10 and resistance at $13.63, with the pair now sitting at the former on the convergence of the 200dMA and 360dMA. This should really act as strong support here given all the confluence, and I am holding firm on my support area spot buys, but if we begins to close below $10 and retest it as resistance I will be exiting my SUSHI position from the past few weeks. As mentioned in a previous post, I will be looking to add if we can flip that $13.63 area as support once again. If you are on the sidelines, this seems like a high R entry for long exposure given that invalidation is very tight.
Turning to SUSHI/BTC, the pair lost support at 19.8k satoshis, which is now acting as resistance along with the 360dMA, which is not promising. That said, we are holding range support here above prior resistance at 14.8k satoshis. I would prefer to see this range resolve to the upside here as any move lower into the 15k area is likely going to lead to me exiting my position, but we shall see. If we do push up and reclaim the 360dMA and 20k satoshis, that is a strong signal for a reversal in my opinion and I’d be looking for a full retrace back towards the May high at 45.3k satoshis.
Chromia:
CHR/USD
Weekly:
Daily:
CHR/BTC
Weekly:
Daily:
Price: $1.26 (1919 satoshis)
Market Cap: $543.818mn
Thoughts: Beginning with the weekly chart for CHR/USD, we can see that last week saw the pair close firmly through prior all-time highs at $0.84 and continue higher to the 1.618 extension of the trend at $1.45, where it has stalled. Given the strength of the breakout and the expansive weekly ranges, I would expect to see the pair continue higher from here, with the 200% extension at $1.77 the next target, followed by the 2.618 at $2.28. Dropping into the daily, the pair flipped the prior high as support, leading to an impulse candle higher and another S/R flip, with the market structure looking good for continuation. As long as we hold above that prior high, I think this just guns towards those higher fib extensions over the next couple of weeks.
Looking at CHR/BTC, the chart is effectively identical here, with the breakout and close through the prior all-time high leading to a push into the 1.618 extension of the trend at 1980 satoshis, through which it wicked towards the 200% extension, falling a little short at 2240 satoshis. If we drop into the daily again, we can see that market structure is strong here, with a clean S/R flip at 1680 satoshis leading to the push beyond 1980. From here, I would expect to see continuation towards 3000 satoshis over the next couple of weeks.
BakeryToken:
BAKE/USD
Daily:
BAKE/BTC
Daily:
Price: $2.18 (3311 satoshis)
Market Cap: $421.919mn
Thoughts: BAKE has been requested by a reader, but I would like to preface this by mentioning that I do not know much about its fundamentals.
Beginning with BAKE/USD, we can see that the pair has been consolidating between range support at $1.44 and range resistance at $2.75, sandwiched largely between the 360dMA below and the 200dMA above. This is looking like textbook depression and thus an ideal area to begin a longer-term spot position if you are bullish on BAKE. The invalidation on entries in this range would be a breakdown below range support at $1.44, or a more aggressive invalidation on a loss of the 360dMA. Opportunities to compound would come on a breakout beyond the 200dMA, with a first target of prior support turned resistance at $4.54.
Turning to BAKE/BTC, the chart looks like a textbook altcoin market cycle, with price now consolidating in a tight range between 3000 and 3700 satoshis below the 360dMA. If this range continues to hold and on-chain activity shows larger holders adding here, I would be all over this. Lose 3k, however, and there is no real support back down towards 1600 satoshis, so this is a make or break range.
Altcoin Market Cap:
ALT/USD
Weekly:
Daily:
ALT/BTC
Weekly:
Daily:
Market Cap: $1.627trn (24.71mn BTC)
Thoughts: Beginning with the ALT/USD chart, from the weekly we can see that the altcoin market has broken out above prior all-time highs at $1.5trn, closing multiple weeklies above the high and now consolidating between it and the new all-time high at $1.65trn. This now confirms for me that the retracement from April into trendline support and the previous cyclical market high at $555bn was very much like the correction in Q3 2017 that preceded the second leg and eventual top of the cycle for alts. As long as we now continue to hold above the higher low formed at the mid-range at $1.03trn and above trendline support, I would expect another parabolic leg higher towards the $4-5trn range above the 3.618 extension of the trend. If, however, the market is weak and this breakout is false, I would expect to see a breakdown below $1trn followed by a loss of the long-term trendline. which would be my exit indicator for alts.
Turning to ALT/BTC, altcoins have been largely range-bound in their performance against BTC for months, having put in a high at ~29mn BTC earlier this year, with the market then selling off against BTC and forming a range above 17.4mn and below that yearly high. The market has formed a higher low since and is now back above the mid-range, suggesting to me that the top of the range is going to be retested as resistance, undoubtedly led by ETH/BTC rallying towards new yearly highs. Break and close beyond that high and I think we see that final parabolic leg higher for altcoins, with the 1.618 extension of this range aligning with the January 2018 market top. Anywhere near that and I will begin significantly reducing altcoin exposure. Likewise, break down below the 200wMA and I will be exiting my positions also, as this will look like a distribution range in that scenario.
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.
If you have the capacity for it, would be great to have another Promising altcoins selection for this upcoming last phase. That post was epic last year. (I know you did the L1 one lately, but it was for 48 coins, and that’s a bit harder to grasp 🙂 )
Absolutely – will do so!
Awesome, thank you in advance!