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Market Outlook #213

Market Outlook #213 (26th March 2023)

Hello, and welcome to the 213th instalment of my Market Outlook.

In this week’s post, I will be covering Bitcoin, Ethereum, XRP, Polygon, Osmosis, dYdX, Celer Network and XCAD Network.

As ever, if you have any requests for next week’s Outlook, do let me know.

Bitcoin:

Weekly:

btcusdweekly

Daily:

btcusddaily

Price: $27,932

Market Cap: $539.678bn

Thoughts: If we begin by looking at BTC/USD, we can see from the weekly timeframe that price is set to close the week right below key long-term support turned resistance at $28.5k – the level that held as support throughout the entirety of 2021. We spent this past week consolidating in a very tight range between $28.9k and $26.7k but are set to close effectively around the prior weekly close at $28k, having traded lower volume than the preceding week, which is expected. Honestly, looking at this the only real concern for short-term bullishness is this $28.5k level we are sat beneath. That is a major resistance level and it wouldn’t surprise me if this area does start to mark out a local top, but for now I am not seeing signs of that. Rather, I think we are more likely to wick up through the level next week towards $30k, and, if we start to reject up there, then I think we have the makings of a local top, as breakout traders get baited into long exposure on the move above $28.5k and then would be trapped if we closed the weekly back below that level. Looking to the downside, I think holding above the 200wMA and reclaimed support around $25.5k is now pivotal, as that level has capped price for most of 2022 (as has the MA), and so you would not want to see it give way on a retest.

Dropping into the daily, we do have some divergence on momentum indicators up here but mostly this just looks like a consolidation range between prior resistance turned support at $26.6k and resistance at $28.5k. What would make for a potential short setup next week would be to sweep all these highs into $30k, then break back below $28.5k, looking for short entries on that retest from below following the sweep. We could then look to add on a daily close below $26.6k and exit back near $25.5k. That’s the short scenario (and whilst $25k holds as reclaimed support, I wouldn’t want to even consider holding short exposure beyond that). For the long scenario, it would be nice to see an early sweep of $26.6k next week, potentially even wicking down into the mid-25s but likely front-running the level itself, leading to a reclaim of $26.6k as support – in that scenario, I would expect another push higher to follow and the squeeze to take price into $30k and potentially beyond, with $32.9k the major level I’d be looking at with that untapped swing-high from May 2022 sat up there. Overall, structure and momentum are still pointing towards upside as we move into April for BTC.


Ethereum:

ETH/USD

Weekly:

ethusdweekly

Daily:

ethusddaily

ETH/BTC

Weekly:

ethbtcweekly

Daily:

ethbtcdaily

Price: $1,775 (0.06365 BTC)

Market Cap: $217.227bn

Thoughts: Beginning with ETH/USD, we can see from the weekly that price closed above $1730 last week and has spent this week in tight consolidation between $1860 as resistance and $1716 as support. Volume dropped off from the prior week but momentum indicators on the higher timeframe are not diverging up here. If we drop into the daily for greater clarity, we can see this consolidation range more clearly of the past week, with channel resistance continuing to cap the top of the daily ranges, as has been the case for most of 2023, but with price now firmly above the 360dMA and continuing to hold above reclaimed support at $1730 for the time being. Much like BTC, we do have some RSI divergence within this range but there hasn’t really been much by the way of a push higher this past week but rather just chop between reclaimed support and $1850. If we see the bottom of this weekly range swept early next week into $1660, I will be looking to buy on a reclaim of $1730 with a target of $2030. If, however, we sweep $1850 early next week and then break down, I would want to see a weekly close back below $1730 to confirm this as a deviation and a move back inside the prior range, from which point we could look for shorts back towards $1500. Right now though, I don’t see much by the way of bearishness on either timeframe – that may well change next week as we go into the monthly close.

Turning to ETH/BTC, having closed firmly below the mid-range last week, this week has been spent in consolidation with prior support at 0.065 acting as resistance. We are in no man’s land right around here and unless we start to see price climb and close back above that mid-range at 0.069, I am expecting to see major support tagged below towards the bottom of the range, with 0.0594 the key level that I have had marked out for months. If we do see the par drop into that 0.057-0.0595 range, I think that’s where long exposure to ETH becomes more preferable to BTC given that this range support above 0.055 has held since April 2021.


XRP:

XRP/USD

Weekly:

xrpusdweekly

Daily:

xrpusddaily

XRP/BTC

Weekly:

xrpbtcweekly

Daily:

xrpbtcdaily

Price: $0.455 (1630 satoshis)

Market Cap: $23.190bn

Thoughts: Looking firstly at XRP/USD on the weekly timeframe, after two years of being capped by trendline resistance from the March 2021 highs, price this past week is finally set to close through that resistance, as well as back above prior resistance at $0.42, which should now act as support. Weekly structure is turning bullish on this break beyond $0.42 (and the 360wMA) and as long as we do now hold above the breakout zone, this is looking promising for XRP. Looking ahead, any retest of the $0.42 area next week would be a buying opportunity with a very clear invalidation on a close below $0.37 for me, with an opportunity to add to spot exposure on a weekly close back above the 200wMA and prior support at $0.51 – clear that level and I think we are beginning a new bull cycle for XRP. Turning to the daily, we can also see that price has broken beyond both the 200dMA and 360dMA, the latter of which has capped price since December 2021, and that MA is now acting as support around $0.415. This cluster of support below is very much key – the last thing you want to see if you’re an XRP bull is a breakout through 2-year trendline resistance met with  an immediate rejection and close back below the key pivot.

Turning to XRP/BTC, we can see that price has bounced off reclaimed support at 1380 satoshis but weekly structure is still bearish here. If we drop into the daily for clarity, we can see that trendline resistance from the October 2022 highs continues to cap every bounce and that price is currently contesting prior support turned resistance at 1625 satoshis. The first sign of a sustained reversal for me would be a break and close back above 1900 satoshis, which would turn daily structure bullish (as well as invalidate trendline resistance). If we see that, I think we take another stab at 2900 satoshis in the coming weeks.


Polygon:

MATIC/USD

Weekly:

maticusdweekly

Daily:

maticusddaily

MATIC/BTC

Weekly:

maticbtcweekly

Daily:

maticbtcdaily

Price: $1.11 (3957 satoshis)

Market Cap: $10.035bn

Thoughts: Beginning with the weekly timeframe for MATIC/USD, we can see that price is in a long-term uptrend following the May 2022 cycle lows, having recently rallied beyond the September 2022 highs at $1.31, closed through that resistance and now retraced back into prior resistance turned support at $1, which is currently acting as a higher-low. Momentum and weekly structure are still bullish here, but that $0.90-1 range is key – break and close back below that and I think we fill in the gap back towards major support above the 200wMA, right around $0.74. If we look at the daily, we can see that structure is currently bearish but choppy and that price has reclaimed resistance at $1.31 following the breakout beyond it. The 200dMA and 360dMA confluence at $0.92 acted as strong support on the retest, and bulls want to now see a higher-low form above $1, which would open up continuation of the trend higher, back above $1.31 towards major resistance at $1.88. If, however, the cluster of support above $0.92 fails, I think $1 becomes a great invalidation for short exposure back towards the mid-70s.

Now, if we look at MATIC/BTC, this chart suggests to me that there is no reason to have long exposure to MATIC at present – even if you think the Dollar pair gets dragged higher by the broader market (BTC rallying), this is structurally a mess. We rejected off the top of the range (all-time highs) that has capped the pair since April 2021 and have since closed the weekly below trendline support from June 2022, with this week also set to close below prior support at 4300 satoshis – coincidentally also the mid-range. This confirms weekly structure as bearish on this fresh low, and the move below mid-range following rejection off the all-time high suggests to me that the pair needs to go and find stronger support back towards the bottom of the range, with 3650 the next key level below. Unless this reclaims the mid-range, I wouldn’t want to be long MATIC – rather, I would want to use it to hedge other long exposure for alts.


Osmosis:

OSMO/USD

Daily:

osmousd

OSMO/BTC

Daily:

osmobtc

Price: $0.80 (2876 satoshis)

Market Cap: $395.677mn

Thoughts: I’ll be focusing on the Dollar pair here for OSMO, given how similar the two charts are at present. That being said, one point I do want to make about OSMO/BTC is that it has made fresh all-time lows, where the Dollar pair has not, indicating relative weakness and the likelihood for underperformance short-term. We do now have a signal for outperformance, however – close back above prior ATLs at 3200 satoshis and I think the pair begins to push higher.

Now, looking at OSMO/USD, we can see that price has returned to major support at $0.74 above the all-time lows at $0.67 and that this area is currently forming a double-bottom with resistance overhead at $0.93. Given how clear the invalidation is here, I think there is a really nice trade to be taken even if you weren’t interested in OSMO for a longer-term cyclical play. I would be looking for entries in the $0.75-0.80 range with invalidation around $0.64 and looking to shift half the position on a 200dMA retest at $1.07 and the other half up near the top of the long-term range near $1.45. If we close below all-time lows, I personally will be cutting my long-term spot position accumulated around $0.70 and will either re-enter on a reclaim or on a range formation lower down. On that longer-term position, I am looking for a gap fill back into $3.70 as my main target.


dYdX:

DYDX/USD

Daily:

dydxusd

DYDX/BTC

Daily:

dydxbtc

Price: $2.38 (8548 satoshis)

Market Cap: $373.127mn

Thoughts: As dYdX has only been trading since October 2021 and thus both pair look broadly identical, I will focus here on the Dollar pair.

Looking at DYDX/USD, we can see that price rejected at $3.71,having close above major resistance at $2.97 back in February, and has since turned daily structure bearish on the break back below $2.38, finding strong support on the 200dMA and now rallying back above both the 360dMA and $2.38. Trendline resistance is currently capping every bounce and the $2.97 is now also acting as strong resistance. Given how momentum and structure are pointing lower here, one would expect to see another attempt at the 200dMA, where if we form a higher-low above that we have the makings of a bottom and therefore likely the beginnings of the next leg higher, with $4.31 as the first target, followed by $7.15 as a major level beyond that. I think if we do come back towards $1.75, that is great opportunity for spot exposure if you’re on the side-lines, with invalidation on a close below $1.60, where I would then expect to see the bottom of the range back near all-time lows retested – but I sincerely doubt that we get such an opportunity. Rather, I am expecting a higher-low to form above that 200dMA and would look to add to my spot exposure on a close back above $2.97…


Celer Network:

CELR/USD

Weekly:

celrusdweekly

Daily:

celrusddaily

CELR/BTC

Weekly:

celrbtcweekly

Daily:

celrbtcdaily

Price: $0.0271 (97 satoshis)

Market Cap: $191.739mn

Thoughts: Beginning with CELR/USD, we can see from the weekly that price is set to close marginally below the 200wMA and trendline resistance from the all-time highs. We also rejected off reclaimed resistance at $0.03, which is a key historical level. That being said, things look promising for CELR, with a higher-low having formed above $0.014 after weekly structure turned bullish, and momentum indicators are pointing towards continuation higher. As soon as we get a weekly close through this major cluster of resistance around $0.03, I think CELR begins its next bull cycle, with the November-December 2022 lows below May 2022 capitulation lows being the catalyst for the disbelief rally of the past couple of months. When we pop this resistance, hope renews. Dropping into the daily, we can see that the swing-low at $0.014 swept the prior 200dMA retest and bounced hard, leading to this V-reversal back above the February high at $0.025 with price now consolidating between that prior resistance as support and the cluster above at $0.03. There is absolutely nothing bearish about this, in my opinion – it just looks like the beginning of a longer-term uptrend. Close through $0.03 and I think we fill in the gap to $0.044 pretty sharply. Invalidation on any long-term spot exposure would be to lose that 200dMA and prior resistance at $0.014.

Turning to CELR/BTC, we can see quite plainly on the weekly chart that we have something of an Adam & Eve style bottom formation, with major resistance at prior support around 110 satoshis left to contend with. Close the weekly above that level and the bottom formation looks complete to me, where we would then expect continued outperformance of CELR, at least for another 40-50% into major resistance around 185 satoshis. If we glance briefly at the daily, we can also see that the pair has broken back above the 200dMA and 360dMA, with both now acting as support for the trend. Promising stuff indeed and one of the better midcap charts out there at the moment, in my view.


XCAD Network:

XCAD/USD

Daily:

xcadusd

XCAD/BTC

Daily:

xcadbtc

Price: $1.92 (6862 satoshis)

Market Cap: $77.582mn

Thoughts: Focusing here on XCAD/USD, we can see that price recently broke above trendline resistance from the all-time high and reclaimed support at $1.74, now rejecting around the 360dMA at ~$2. Structure is firmly bullish with a series of higher-highs and higher-lows since the December bottom, and I would now expect continuation higher into the major support turned resistance cluster between $2.40 and $2.75, which I think will mark out a local top for XCAD, from which we may see a deeper retracement. Nonetheless, the trend is looking strong here and whilst we hold above $1.37 I think we are very much in a new bull cycle for the pair. I will be looking to hold XCAD for the duration of the cycle, with a view to sell the majority of my position up near $8.70 as very strong resistance below the all-time high. Not much else to add here – dips are for buying, in my opinion.

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.


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