Market Outlook #17

Market Outlook #17 (6th January 2019)

Happy New Year, everyone! Welcome to the 17th Market Outlook, and the first of 2019. Having taken a two-week break over Christmas, it seems I missed a lot of interesting action; in particular, that of Ethereum, as we’ll discuss shortly. Overall, it looks to me like the signals that appeared inĀ  early December in anticipation of short-term reversals are finally bearing fruit across-the-board…

In today’s post, I’ll cover the past couple of weeks of price-action in Bitcoin, Ethereum and Monero, as well as Stratis and Komodo. Let’s crack on:

Bitcoin:

Price: $3901

Market Cap: $68.135bn

Thoughts: So, it’s been a good three weeks since the last Market Outlook, in which I suggested that a short-term bottom was nearby. Since then, Bitcoin has moved from ~$3200 to just shy of $4400 and back to around $3700. Price then consolidated after the period of volatility and has now found short-term resistance at $4115 (a level of prior resistance), with higher-lows forming with each test; this, in essence, is an ascending triangle, but volume is currently flat, so we can’t be 100% confident in a breakout to the upside.

That being said, the 1H chart clearly shows a lot of swing highs in the $4100 region that remain unswept, and with price having already cleared the swing-low at $3875, it is likely that we will see continued bullish price-action. However, I wouldn’t rule out the possibility of a false breakout to the downside, with price looking to trade inside the 1H bullish orderblock at $3825 prior to making any further upwards progress…

Ethereum:

ETH/BTC

Price: $153.49 (0.0399 BTC)

Market Cap: $15.943bn (4,162,730 BTC)

Thoughts: Ethereum has experienced a tremendous reversal, having swept the September lows at ~0.027 BTC early in December. The Weekly shows us that price failed to break the long-term support at ~0.023 BTC, and the reluctance to make new lows has led us to a near-60% rally against Bitcoin. In the process of rallying, ETH has broken through numerous short-term resistance levels on significant volume, with the most important move occuring towards the end of 2018, when price broke above 0.034 BTC, thus breaking the bearish market structure. Price has since held that level, moving up through the resistance at 0.0375 BTC. Volume is declining on the Daily, however, suggesting that this current leg may be overextended. I would expect a period of relief, in which price moves back towards 0.036 BTC; but, make no mistake, it is very much likely we have found the cyclical bottom for ETH/BTC.


Monero:

XMR/BTC

Price: $50.35 (0.0315 BTC)

Market Cap: $840.794mn (219,575 BTC)

Thoughts: Monero has had a more relaxed few weeks, but also seems to have found a bottom. The Weekly shows us that price remains within the bullish orderblock from October/November 2017, failing to break below the support at 0.0111 BTC despite the extended downtrend. This downtrend has now been broken, as is clear from the Daily, and it looks as though an Adam & Eve bottom is forming with a neckline at ~0.0135 BTC. I expect Monero to take the reigns from Ethereum soon and rally towards the support turned resistance at 0.016 BTC. But first, we need a close above 0.0141 BTC to confirm the bullish market structure.


Stratis:

STRAT/BTC

Price: $1.07 (27939 satoshis)

Market Cap: $106.086mn (27,705 BTC)

Thoughts: Any regular reader of this blog will know that I am very fond of Stratis, having mentioned it in multiple posts. Around Christmas, Stratis experienced a huge buyup, after spending some time trading below range support. In that period, around a third of Stratis’ circulating supply was traded across all exchanges, and price blasted through the consolidation range, up to a peak around 42500 satoshis. In doing so, it cleared major resistance below 30k satoshis on significant volume. I would expect this area between 27-30k satoshis to become a new level of support. The recent drop-off after the peak has occured on ever-decreasing volume, suggesting that a new swing-low should soon form and, with it, a new leg up should begin.


Komodo:

KMD/BTC

Price: $0.77 (19975 satoshis)

Market Cap: $85.268mn (22,239 BTC)

Thoughts: It is somewhat rare to spot such an obvious buy as Komodo. Price has been in a large range for a long time, with rising levels of volume and clear accumulation taking place. Range resistance continues to hold at 23k satoshis, but this is one to buy on any movement back towards range support around 16k satoshis. There’s really very little else to say about this one except that the opportunity is made overt by the chart.

That concludes this instalment of Market Outlook. I hope you’ve enjoyed the read and found something of value here. Please feel free to leave any questions or comments below!


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