Market Outlook #229 (17th July 2023)
Hello, and welcome to the 229th instalment of my Market Outlook.
In this week’s post, I will be covering Bitcoin, Ethereum, XRP, Solana, Stellar, MultiversX, dYdX and Oasis Network.
As ever, if you have any requests for next week’s Outlook, do let me know.
Bitcoin:
Weekly:
Daily:
Price: $30,278
Market Cap: $588.276bn
Thoughts: If we begin by looking at BTC/USD on the weekly timeframe, we can see that price printed quite an ugly candle last week, wicking through the prior three weekly highs but ultimately closing back near the weekly open around $30.3k. This is currently looking like rejection of another leg higher but it is also important to note that price remains sandwiched between that $30.8k resistance and reclaimed range support at $28.8k. Whilst the pair continues to hold above that prior support, this is largely just chop – and I would wait for a clear signal either side of this range before getting too excited about the next move. If we do begin to close the weekly back below $28.8k, then we can look at a retest of the prior swing-low around $25.4k as a possibility, but with the 200wMA also sat around $27k, I find it hard to get excited about the R/R of any shorts that aren’t just intra-day. For bulls, obviously a weekly close through $31k is what we are waiting to see – get that on decent volume and I do think we just teleport towards $36k over the subsequent weeks.
Dropping into the daily, here we can see some stronger indications of weakness at present, with that bearish divergence on each push into resistance. Whilst $30.8k continues to cap price, there is quite literally no reason to be levered long here in my view, as the daily is pointing to downside. If we do see that downside, a daily close below $29.5k would lead to a retest of prior range support, where any lack of demand will be a clear signal that this is likely moving back towards at least the 200dMA around $25.8k. Now, if this is all a bear trap within this range, a wick through $29.5k followed by a daily close above $31.4k would be a really nice signal for long exposure, where invalidation would be that $29.5k area and the target would be $34.3k followed by $36k.
Ethereum:
ETH/USD
Weekly:
Daily:
ETH/BTC
Weekly:
Daily:
Price: $1,931 (0.06377 BTC)
Market Cap: $232.146bn
Thoughts: Beginning with ETH/USD, we can see that price actually held up a little better than BTC, wicking into $2037 as resistance, rejecting but ultimately closing back near the previous weekly open at $1923. We remain firmly above that pivot at $1847 for now and I am just waiting for acceptance above $2037 to look for longs into $2425, where the 38.2% retracement of the bear market sits. Dropping into the daily, we also don’t seem to have the bearish divergence here that we do on BTC/USD, which is promising for this most recent push higher – we have clean bullish structure on the daily and higher-lows forming. It is key that $1847 now holds firm as support, as any close back below that now would look weak and I would be looking to short this back down towards $1664 if we see that. If we retain this structure, a daily close above $2037 would look like a strong signal for a retest of the 2023 high at $2171, and a weekly close above that former resistance is what I want to see to really be convinced of another leg higher into $2425.
Turning now to ETH/BTC, we are starting to form some structure here, having reclaimed support at 0.0622 finally and now pushing up into prior support turned resistance at 0.0645, which is capping price. Looking at the daily for clarity, we can see how price deviated below 0.0622, then broke above it, then formed a higher-low at 0.061 and then reclaimed 0.0622 once again, now consolidating just below resistance. This is really nice structure and as long as we now hold 0.0622, this looks more like a bottom formation that an indication of another leg lower – at least for now. Close the daily above 0.0645 and I think we squeeze higher back towards the major resistance cluster around 0.068.
XRP:
XRP/USD
Weekly:
Daily:
XRP/BTC
Weekly:
Daily:
Price: $0.751 (2480 satoshis)
Market Cap: $39.451bn
Thoughts: Beginning with XRP/USD, we can see quite clearly how last week’s rally took the pair through year-long resistance at $0.55 all the way into reclaimed resistance at $0.77, with the pair wicking above that into $0.91 but closing the week at that level, firmly through the resistance cluster. It goes without saying that weekly structure and momentum favours bulls here, so I do believe we are in buy-the-dip territory for XRP, where any retracement from here towards the range between $0.58-0.65 would be a buying opportunity, with expectations of continuation higher, firstly into the July 2021 highs at $1.42 followed by the March 2021 high at $1.98. Invalidation on long exposure for me would be a close back inside $0.55.
Turning now to XRP/BTC, we can see how price had been finding support around 1625 and then rallied off that level through the 200wMA and prior resistance at 2100 satoshis, pushing all the way into multi-year resistance at 3070 satoshis and rejecting there, closing the week out at 2470. Weekly structure is bullish on this move through 2100 and given that XRP has been range-bound between 1250 as support and 3070 as resistance since March 2021, any weekly close above 3070 would be a huge signal for acceleration higher, with 4000 satoshis the major resistance beyond that, which has not been breached since 2019. Dropping into the daily, we can see how price is struggling here at 2470, but I don’t know how likely it is that we get a perfect retest of 2100 as a buying opportunity – if we do, I will be taking it, but more broadly I am looking at how lower-timeframe structure forms if we approach that level; I’d be happy with 2150, which is still ~12% lower from here.
Solana:
SOL/USD
Weekly:
Daily:
SOL/BTC
Weekly:
Daily:
Price: $27.67 (91,383 satoshis)
Market Cap: $11.144bn
Thoughts: If we begin by looking at SOL/USD, we have the clearest long-term bottoming structure that we could really expect: you had capitulation into $7.95 in December 2022, followed by consolidation below long-term trendline resistance, followed by a deviation below that range support that formed a higher-low in June at $15, and now a multi-week rally on growing volume that has broken the trendline and turned weekly structure bullish. We are now sat right between prior resistance at $26 and prior support at $30, and if you are on the side-lines I would be looking at any retracement into $22 as an opportunity to get on board, if that comes. Looking ahead, I expect to see continuation higher over the coming months through the July-August 2022 highs and into the 23.6% fib retracement of the entire bear market at $70, which is also where there is prior support. Dropping into the daily, we can see how the pair has emerged above the 360dMA for the first time since April 2022 and reclaimed the 200dMA, and whilst we are not yet showing signs of exhaustion of this rally I wouldn’t be too hasty to jump in up here just based on R/R. Rather, if we do break back inside $26, I would be looking to layer bids between the 200dMA and 360dMA ($21-24). For me, invalidation of the long-term spot position would be on a close back below $15 now.
Turning to SOL/BTC, we can see quite evidently why we shouldn’t be rushing to jump in right here, as this recent rally has taken the pair right into long-term trendline resistance, which continues to cap price. We are also sat right at reclaimed resistance around 92k satoshis, so there is plenty to overcome here. Volume is growing week on week and momentum is pointing higher, with last week’s close also turning weekly structure bullish, so all of that is promising, but it would not be surprising to see a small retracement from here before continuation through that trendline. Once we get a weekly close through it, I would expect to see the 111.8k-satoshi level get tested, with acceptance above that opening up the next leg higher to fill in that November 2022 capitulation gap into 145k. Dropping briefly into the daily, again we don’t have any momentum exhaustion just yet but I wouldn’t be surprised to see a retest of the 200dMA as support at 81.2k, particularly given how perfectly it has capped the highs at pivotal moments throughout the past year. Keeping a close eye on it this week…
Stellar:
XLM/USD
Weekly:
Daily:
XLM/BTC
Weekly:
Daily:
Price: $0.129 (427 satoshis)
Market Cap: $3.518bn
Thoughts: Looking firstly at XLM/USD, on the weekly we can see some similar structure to XRP, whereby the pair had been consolidating below $0.097 since October 2022, then deviated above it in April before coming back to retest reclaimed support at $0.079 – this level then acted as the spring for this most recent multi-week rally, reclaiming $0.097 as support and continuing through the 2023 high at $0.116 all the way into the 200wMA and prior support at $0.19. Price rejected up there and close the week back near $0.13, but weekly structure and momentum are now firmly bullish and I would be keen to get on board over the next week or two in anticipation of continuation higher. Looking at the daily, we can see how price broke through both the 200dMA and 360dMA, the latter of which acted as support right around $0.10, and price then broke through a double top around $0.115. That’s the level I want to buy if we drop into it from here, with invalidation on a close back below $0.097, looking for $0.24.
Turning to XLM/BTC, again we find ourselves having rallied right into multi-year trendline resistance from the all-time high, with that are also having confluence with prior support and the 200wMA at 636 satoshis. The pair rejected right around that cluster and ultimately closed out last week at 435 satoshis, but that was – importantly – back above the historical support level at 400 satoshis. Weekly structure is bullish, and we had bullish divergence on that bottom, so whilst it is likely we do consolidate or chop a little over the next week or two, I ultimately expect the pair to take another crack at 650 satoshis, above which I think we run towards the 360wMA and prior support at 1275 as the next major resistance.
MultiversX:
EGLD/USD
Weekly:
Daily:
EGLD/BTC
Weekly:
Daily:
Price: $37.97 (0.00125 BTC)
Market Cap: $976.927mn
Thoughts: If we begin by looking at EGLD/USD, we can see that there is really nice bottoming structure here from a cyclical view: we have continually diminishing volatility and over 400 days of price compression, with the most recent dump taking price into $28.32 before reclaiming prior resistance at $32.50 as support and now pushing into the May ’22 support for a possible reclaim. We also have long-term divergence in momentum on each leg lower. If we can now cleanly break through $39 and accept above it, I would consider the bottom to be in here and would begin looking for long exposure. Looking at the daily, we can see that price is also being capped by the 200dMA and 360dMA, which have capped the pair for most of the bear market, providing confluence for my view on a bottom formation if we can clear this cluster on good volume. I would be looking to rebuy any retracement back towards $40 after we move away from it and looking for $113 as the first major target, followed by $220.
Turning to EGLD/BTC, we can see that we aren’t yet seeing the same structure and momentum exhaustion as the Dollar pair but price is pressed right up against reclaimed resistance and trendline resistance at 0.00131 here, and this trendline has capped every high since October 2022. If we can break and close back above 0.00131, I would look for a higher-low to form above this 0.00106 low for the beginnings of a structural shift. Dropping into the daily for clarity, we can see how far below the 200dMA the pair remains, with it currently sat up near 0.00156, which is the June 2022 capitulation low – in my opinion, reclaiming that level will be the catalyst for the disbelief part of EGLD’s next cycle of outperformance.
dYdX:
DYDX/USD
Weekly:
Daily:
DYDX/BTC
Weekly:
Daily:
Price: $2.20 (7262 satoshis)
Market Cap: $374.102mn
Thoughts: Looking at DYDX/USD, we can see that price reclaimed support at $1.78 ad is now pushing back above $2.14, but weekly structure is still technically bearish here. As long as the pair now holds above $1.78, however, I think it is more likely that we continue squeezing higher, back above reclaimed resistance at $2.40 and into trendline resistance that has capped the highs all year. Once we accept above that trendline, I am expecting the next leg of this cycle to begin for DYDX, with the 23.6% fib retracement at $7.50 the first major target I have for my spot position. Dropping into the daily, we can see that daily structure and momentum are indeed bullish and we have reclaimed some key levels, nut the 200dMA is currently capping price, as it has done since May. If you are on the side-lines, I think it would be wise to await a clean break back above the 200dMA and then buy it as a retest with invalidation at $1.77, looking to add once we get above that trendline.
Turning to DYDX/BTC, we have been consolidating right around historical support for weeks and price is finally pushing higher, looking to break above prior support turned resistance at 7167 satoshis. We remain below trendline resistance and reclaimed resistance at 7925, which I think is the key level to look for a breakout beyond; clear that and I think we teleport to 11k satoshis, followed by 15k. Dropping briefly into the daily, we can see how the 200dMA and 360dMA are perfectly confluent right above that 8k satoshi level, so a strong candle through that on good volume would be a signal for continuation higher and the next leg of the cycle. Not much else to add here.
Oasis Network:
ROSE/USD
Weekly:
Daily:
ROSE/BTC
Weekly:
Daily:
Price: $0.051 (169 satoshis)
Market Cap: $256.997mn
Thoughts: Beginning with ROSE/USD, we can see that price continues to consolidate right around long-term support at $0.044, currently capped by prior support at $0.052. Honestly, I think this is the prime accumulation range for those looking to get involved, as there is really clean invalidation on a close below $0.0436, particularly given the historical significance of that level. I am holding spot here and looking for a move through $0.061 as the signal for the next push into $0.08 resistance – but, looking a the past year of price-action, what is clear to me is how the December low was a textbook deviation below the primary range support that has otherwise held since May 2022. Onwards and upwards later this year, in my view.
Finally, looking at ROSE/BTC, we can see how price continues to be capped by trendline resistance this year but price has found support at 150 satoshis. We are now consolidating tightly below that trendline and prior support at 170, and I am expecting a breakout to follow, where any weekly close above 181 would look very promising to me. If we do see that, I would consider any retracement into 170 as a really good buying opportunity, with obvious invalidation at 148. Looking at the daily, we can see some structure forming here wit ha higher-low above 148, but that trendline is really the thing to be paying attention to here, as well as 181 satoshis – clear that latter level and daily structure turns bullish too, from which point I expect the 220 level to be retested as resistance, where the 200dMA is sat. I am ultimately looking to hold thing for the bulk of a cycle, so I am not too concerned with short-term targets, but I do expect 220 and 280 to provide resistance.
And that concludes this week’s Market Outlook.
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As ever, feel free to leave any comments or questions below, or email me directly at nik@altcointradershandbook.com.
