Market Outlook #195 (16th October 2022)
Hello, and welcome to the 195th instalment of my Market Outlook.
In this week’s post, I will be covering Bitcoin, Ethereum, Solana, Avalanche, Algorand, Arweave, Oasis Network and Moonbeam.
As ever, if you have any requests for next week’s Outlook, do let me know.
Bitcoin:
Weekly:
Daily:
Price: $19,148
Market Cap: $367.772bn
Thoughts: If we begin by looking at BTC/USD on the weekly timeframe, we can see that price this past week wicked below the previous three weekly lows, into $18.1k, then bouncing and now set to close right back near $19.2k. This is promising for bulls short-term as once again we see local lows swept into support, but price failing to break through the $17.6k swing-low and pushing back up once again. I would expect to see that local trendline tested again to the upside next week and price attempt a breakout beyond $20.6k. If that fails, down down to goblin town…
Looking at the daily, we can see some mixed signals with the strength of the buy-back following the wick through local lows, but then rejection at $19.8k the next day, with consolidation between the two levels occurring this weekend. As long as we don’t start to break back below $18.6k early next week, I think it is likely we make another attempt at the $20.6k highs, where any close above that level and above trendline resistance opens up $21.8k. If, however, we wick through $20.6k and reject and break back below $19.8k subsequently, I would favour shorts all the way into $17.6k from there.
Ethereum:
ETH/USD
Weekly:
Daily:
ETH/BTC
Weekly:
Daily:
Price: $1,285.91 (0.06714 BTC)
Market Cap: $157.312bn
Thoughts: Beginning with ETH/USD, we can see from the weekly that price wicked through the previous three weekly lows into $1190 and has bounced off that area, now set to close right around the 200wMA just below $1300 once again. Liquidity has been taken to the downside without a clean break, so one would now expect to see upside liquidity at $1416 to be taken, assuming that $1217 can hold as support next week. If we drop into the daily, we can see this range more clearly, with price having taken out the bottom of the range and then consolidated around $1288. From here, if we can push on towards that $1416 area next week, bulls want to see a daily close above that level to open up the probability of $1560 being tested as resistance, and the formation of a new range. If we wick through $1416 and break back below it, that is a clear short opportunity back towards at least $1288 if not $1216. Only when we get a daily close below the bottom of the range would I look for shorts into $1000.
Turning to ETH/BTC, we can see that price continues to consolidate just below the mid-range, and if we look at the daily for clarity, we can see that we are really just chopping lower gradually against that trendline resistance turned support, with no real momentum to the downside at present. If we break higher and squeeze into 0.072, I would expect that to cap price and lead to another leg lower from there towards 0.0594. Until we reclaim 0.072, I am biased towards further downside from here. Not much else to add for now…
Solana:
SOL/USD
Weekly:
Daily:
SOL/BTC
Weekly:
Daily:
Price: $29.92 (0.00156 BTC)
Market Cap: $10.715bn
Thoughts: Looking firstly at SOL/USD, we can see on the weekly that price continues to chop around within a tight range between $30-36 as it has been for a couple of months, but this week saw price wick through range lows into $27.85 and then bounce back towards that $30 area, around which the weekly is set to close. This is not as promising as the ETH and BTC charts just because we are teetering on the edge of a range breakdown here, which would open up the likelihood of a $24.25 retest. If we drop into the daily, I am considering three trajectories from here for re-accumulation of SOL before a new cycle: the first would be for an immediate reclaim of $30 next week and price to then continue to chop around inside the range as it has been doing before breaking up towards the 200dMA and prior resistance around $47-51; the second would see price bleed lower out of this range into the June lows at $26 and take those out before a reclaim and consolidation above the level; the last would see a full breakdown below the range and the pair to continue lower into $19. To be honest, I am unsure on which of these three appears more likely at present given the lack of momentum as we have moved just below this range, but I would expect that BTC and ETH would drag SOL higher if we do get the anticipated squeeze next week, which lends me to believe that we see continue consolidation below $36 but above $30.
Turning to SOL/BTC, we can see a similar pattern of tight consolidation, but with support currently holding firm. Looking at the daily, we can see that 0.00153 is acting as support here, but any loss of this level opens up another 10% of downside towards 0.001367. If we can hold here, I think the pair takes another crack at the 200dMA and top of the range at 0.0018. To be honest, across both pairs at the moment the trajectory is unclear and so I am loathe to have SOL exposure right now…
Avalanche:
AVAX/USD
Weekly:
Daily:
AVAX/BTC
Weekly:
Daily:
Price: $15.61 (81,540 satoshis)
Market Cap: $4.627bn
Thoughts: If we begin by looking at AVAX/USD, we can see from the weekly that following rejection at prior support turned resistance at $30.61, price has retraced all the way back into support at the June lows of $15. If this is to hold as a cyclical low, we should see demand step in here next week and push the pair higher, with any move back above $18 making this more likely, in my opinion. If, rather, we see $14.95 lost, there is a huge gap to the next major support level at $10.46, and I would not want to be holding any AVAX exposure in that scenario. If we drop into the daily, we can see how clear invalidation is here, as any close below ~$14 would take out the June low and open up that 25-30% of further downside towards $10. As such, if you’re keen on Avalanche, you couldn’t really ask for a better entry than around this support area. I would rather see if price consolidates above this level first and then buy the return to bullish market structure on a close back above $18.
Turning to AVAX/BTC, we can see that price is still well above those June lows, having retraced back into an area of reclaimed support around 75k satoshis, now consolidating just above it. Looking at the daily, we can see the potential formation of an Adam & Eve bottom above that June low, which would see some more consolidation and potentially another push lower into that 72-75k satoshi area, before winding back above 90k satoshis and pushing on from there. If we do see something like this begin to form, I think increasing AVAX exposure makes a lot of sense once we’re back above that 90k-satoshi area.
Algorand:
ALGO/USD
Weekly:
Daily:
ALGO/BTC
Weekly:
Daily:
Price: $0.33 (1697 satoshis)
Market Cap: $2.228bn
Thoughts: Beginning with ALGO/USD, now this is a chart that I am very much keen on for short-term bullishness, as long as we now hold above reclaimed support at $0.30, having retested it this week. We now have bullish structure on the weekly and a possible higher-low. Looking at the daily, I am a buyer here with invalidation on a close below $0.27 and looking for the 1.618 extension of the trend to hit right in that overhead resistance zone around $0.50. Nothing else to add here – very clean and I am on board. (If we do break below $0.27, I am a buyer on a sweep and reclaim of $0.25).
Turning to ALGO/BTC, we can see that following the trendline breakout we have now retested resistance as support and bounced off it, with the daily also showing that the 200dMA and prior resistance around 1600 satoshis is now support. This provides confluence for our bullish thesis on the Dollar pair, and as long as 1600 satoshis is protected next week, we should see the pair now push on to retest the 360dMA and reclaimed resistance around 2050-2200 satoshis.
Arweave:
AR/USD
Daily:
AR/BTC
Daily:
Price: $9.78 (51,070 satoshis)
Market Cap: $326.575bn
Thoughts: If we begin by looking AR/USD, we can see that the pair has fully retraced its bull cycle into the all-time low at $7.10 in June, then rallying off that low to take out resistance at $16.50, but rejecting and now returning to the reclaimed support base above the all-time low at $8.10. This is exactly the sort of price-action bulls want to see, as we have another possible adam & eve bottom playing out above the all-time low, with a higher-low currently in formation. If price can break back above $9.98, daily structure turns bullish, with any move beyond that through $11.70 confirming for me that the bottom is in and that the next cycle is likely to begin with disbelief above that $16.50 resistance. I am a buyer of spot AR here at around $10, with invalidation below the all-time low at $7, looking to hold for 12-18 months.
Turning to the BTC pair, we can see that price and momentum have been diverging on recent pushes lower, with no real momentum into the most recent low at 44k satoshis. From that low, price has rallied, reclaiming multiple minor support levels but now sitting below support turned resistance at 53.2k satoshis. From here, I would expect to see another higher-low now form above 47.5k, from which any move back above the 200dMA at 56k satoshis confirms that the trend is pointing towards another test of the 75k area, where price rejected in July. This price-action is supporting the bull case for the dollar pair and unless we now retrace this entire rally back below 44k satoshis, I am an AR bull.
Oasis Network:
ROSE/USD
Weekly:
Daily:
ROSE/BTC
Weekly:
Daily:
Price: $0.055 (290 satoshis)
Market Cap: $279.291mn
Thoughts: Looking firstly at ROSE/USD on the weekly timeframe, we can see that price has retraced from support turned resistance at $0.115 all the way back into the support base from June, currently sat above $0.052, which is where my original spot buys were. I am adding to my spot position here until I have filled a 3% allocation, with invalidation on a weekly close below $0.042, where I would then look to re-enter on a range reclaim or down near $0.033. Looking at the daily, we can see price wicked into support a coupe of days ago and bounced, and I am now expecting to see $0.052 act as support for the next push higher, where any break beyond $0.067 turns daily structure firmly bullish and we can then look towards $0.08 as major resistance beyond that.
Turning to ROSE/BTC, we can see that price is hovering above reclaimed support at 285 satoshis at present, which is also prior resistance that preceded the rally higher into 500 satoshis in August. From here, as long as we can stay above 250 satoshis, which is around the base of the rally, I think we are going to form a macro higher-low from which price then pushes on to retest that 500-satoshi resistance, above which is clear skies for 720. Dropping into the daily, we can see that the 200dMA also continues to cap price, with lower highs forming below it, and so I am looking for a break and close above 340 satoshis to confirm a reversal and look to add more spot. Promising stuff so far, as long as we hold those key levels. This is a long-term position, just like AR.
Moonbeam:
GLMR/USD
Daily:
GLMR/BTC
Daily:
Price: $0.49 (2591 satoshis)
Market Cap: $209.857mn
Thoughts: As Moonbeam has only been trading since January, I will focus on the Dollar pair here, as it provides more structure whilst both pairs appear identical in price-action.
So, looking at GLMR/USD, we can see that price retraced 98% of its value from the all-time high into an all-time low of $0.416, which has acted as the base for around 4 weeks at this point, with price rallying off that base today to reclaim minor support at $0.46. I would want to see price continue to push on from here above and beyond $0.55 as a show of demand off the all-time low and then retrace back into the range for re-accumulation, which is when I would want to be a buyer, with invalidation of course on new all-time lows, as we then return to bearish price discovery. As Moonbeam has been in a bear market throughout its existence, this is definitely a project I want to have exposure to for its first bull cycle, but I do still think it’s got some time before the bottom has fully formed, as less than one month of trading around the lows after a 98% drawdown just is not sufficient for a new cycle to begin, in my experience.
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.