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Market Outlook #252

Market Outlook #252 (22nd January 2024)

Hello and welcome to the 252nd instalment of my Market Outlook.

In this week’s post, I will be covering Bitcoin, Ethereum, Cardano, Immutable, dYdX, Blur, Unibot and LayerAI.

As ever, feel free to comment with any requests for next week, or shoot me an email.

Bitcoin:

Weekly:

btcusdweekly

Daily:

btcusddaily

Price: $40,425

Market Cap: $791.943bn

Thoughts: If we begin by looking at BTC/USD on the weekly timeframe, we can see how last week saw the pair consolidate right around that $42k level on declining volume – an expected sight after the previous weekly candle. We are still sat above $39.6k support and now consolidating below $42k with that level as resistance; and if we start to break below that level this week, I would expect to see a deeper retracement begin, with numerous untouched lows ready to be swept all the way towards that prior resistance trendline above $33k. Assuming we do close the weekly below $39.6k, I think we see a multi-week bleed followed by capitulation into that area, mark out a low in February and then rally off it as we head into March. Now, if we can hold above $39.6k this week, and start to push above $42k, I would expect a retest of $45k as reclaimed resistance to follow; where we go from there would be completely dependent on reaction at the level, but I think it’s safe to assume a bearish short-term view below $45k and a bullish one above it (or down near that $33k-36k range).

Dropping into the daily, we can see how we are also sat right around trendline support from October, having wicked below it last week but closed above, but with daily structure here pushing price lower with support becoming resistance. We are also still sat firmly above these lows above $40k for now, and if we are to see some relief here to trap late shorts at support, I would expect to see $39.6k swept and price then rally towards $45k from there, where I am leaning towards rejection and continuation lower towards that $36k area later in February. Only above $45k do I switch bias towards continuation of the trend higher into Q2 and the halving – either there or down near $33-36k; between that range is favourable for shorts in my view and/or sitting on your hands whilst this chops around.


Ethereum:

ETH/USD

Weekly:

ethusdweekly

Daily:

ethusddaily

ETH/BTC

Weekly:

ethbtcweekly

Daily:

ethbtcdaily

Price: $2360 (0.05837 BTC)

Market Cap: $285.248bn

Thoughts: If we begin by looking at ETH/USD on the weekly timeframe, we can see that last week saw price reject at $2650 resistance again but hold marginally above prior resistance turned support at $2425, below which we look to be turning once again with BTC steering the ship for now. Re-entering a multi-week range after a high volume breakout is not particularly promising, but once again this is expected given BTC’s price-action post-ETF. If anything, I would now expect to see the bottom of the range retested as support once again at $2156, where we may then expect to see a deep sweep of those range lows into $2037 before a bottom forms. Dropping into the daily, we can see how support is failing here and if we close below $2425 today, I would expect it to act as resistance the rest of this week unless BTC can find some relief. From there, it’s a straight road down back to $2156, where we have a lot of support at prior yearly highs. If we see a sweep of that level into $2037 (and potentially the 200dMA) late this month or even in February, that would be the ‘dip’ I would look to open a levered long on low leverage – we would be 25-30% off the recent highs with the spot ETF narrative coming into view for May.

Now, turning to ETH/BTC, we can see that as expected after a mammoth week, last week saw the pair consolidate in a tight range, rejecting a move through trendline resistance and close marginally below it at 0.059. As mentioned last week, I am expecting to see a shallow dip, but a dip nonetheless, with the 0.055 reclaimed range support being the most important one to hold above. If we drop into the daily for clarity, we can see that price is now sat right on the 200dMA, with prior resistance also just below at 0.0577. This is an untested level, and if the pair is in full control of bulls and we get less BTC/USD volatility, I would not be surprised to see this level hold, where any swing-low above it would lead to another attempt at a trendline breakout. If this level does not hold, I am expecting continuation lower towards 0.055, where I expect a significant show of demand above that level given how hard we reversed off the bottom. Let’s see how the next couple of weeks unfold…


Cardano:

ADA/USD

Weekly:

adausdweekly

Daily:

adausddaily

ADA/BTC

Weekly:

adabtcweekly

Daily:

adabtcdaily

Price: $0.49 (1210 satoshis)

Market Cap: $17.152bn

Thoughts: If we begin by looking at ADA/USD, we can see on the weekly that price rejected for multiple weeks at the 200wMA at $0.68 before breaking back below resistance at $0.60, then falling into $0.47, above which it held last week. We are now sat in between two key levels: prior resistance turned support below at $0.42 and that $0.60 resistance level overhead. Momentum indicators look great on the weekly for continued upside once a bottom is found, and I would expect to see $0.42 hold here for the pair if tested. Dropping into the daily, we can see how structure turned bearish after rejection above $0.60, and now price has formed a double bottom above $0.46 – unless we now put in a couple of higher-highs and lows from here above this level, I think it’s better to assume the bearish structure holds and this double bottom gets swept into $0.422, aligning with resistance of the previous consolidation cluster before the rally higher also. Looking ahead, above $0.60 I think this guns for $0.88 before finding any further resistance, but that may yet be a couple of months away.

Turning to ADA/BTC, we can see that weekly structure is bullish following the trendline breakout and subsequent reclaim of 1175 satoshis as support, with price now looking to form another higher-low above that level. This is exactly where bulls want to form a base following the rally, as this level acted as resistance for months prior to it. If it fails to hold, bulls will look to 1000 satoshis as minor support below, with stronger support at 950, but that would also meaning erasing the entirety of the rally through resistance, thereby looking much weaker. If we drop into the daily, we can see how sharply price bounced off the 200dMA and then reclaim 1125 and 1175 as support, finding resistance at 1300 satoshis. We are now forming that second higher-low above the key level and if we can close the daily back above 1300, that would be a strong sign that another bottom is in and the pair is ready to tackle 1500 satoshis again, above which I don’t think this stops all the way into 1975. If this support does give way, one thing that would look like a really nice formation would be bullish divergence on a second move below 1125 into the 200dMA…


Immutable:

IMX/USD

Daily:

imxusddaily

IMX/BTC

Daily:

imxbtcdaily

Price: $1.79 (4421 satoshis)

Market Cap: $2.371bn

Thoughts: As both pairs for IMX are looking virtually identical, let’s focus here on the Dollar pair.

Looking at IMX/USD, we can see that price has begun its first bull cycle, bottoming out in December 2022, rallying into March 2023, forming a higher low at $0.48 in September 2023 and then rallying into $2.60 a few weeks ago, with price since having turned market structure bearish and retraced into support at $1.77, above which it is sat. We have trendline resistance capping rallies and I would be surprised to see this support hold here, looking as weak as it does; rather, I am expecting the March 2023 high at $1.58 to be retested as support and price to begin forming a bottom there, from which to make the next leg higher towards $3.35. If $1.58 does not hold, we have some strong support between $1.09 and $1.31, but unless the broader altcoin market gets destroyed in the coming weeks, I find it hard to believe you’re gonna get another 60-70% drawdown from the highs to buy into like the previous one. Let’s see what happens…


dYdX:

DYDX/USD

Weekly:

dydxusdweekly

Daily:

dydxusddaily

DYDX/BTC

Weekly:

dydxbtcweekly

Daily:

dydxbtcdaily

Price: $2.71 (6690 satoshis)

Market Cap: $850.304mn

Thoughts: Beginning with DYDX/USD, we can see that price formed a higher-low a couple of weeks ago above $2.14, closing out above $2.40 and holding above it the subsequent week. Price then consolidated below prior support turned resistance at $2.96, rejecting a move beyond that, but everything on the higher timeframes is currently pointing towards further upside, as long as $2.40 now holds as support. If we see a weekly close back above $2.96, I would expect $3.71 to be retested shortly thereafter, with fresh highs above $4.30 if $3.71 gets cleared. The trend – longer-term – is clearly pointing towards higher prices. Dropping into the daily briefly, we can see that price is capped by trendline resistance but is forming a higher-low here after bouncing off the 200dMA; close the daily through $2.97 and I think we see acceleration into $3.21m, above which daily structure turns bullish again, opening up the top of that range as mentioned. Looking like a bit of an outlier at the moment…

Turning to DYDX/BTC, we can see that price is still capped by trendline resistance from 2022, but recently swept a number of lows into major support at 5270 satoshis, rallying hard off that sweep into 7100 satoshis, below which price is now consolidating. If we look at the daily for more clarity, we can see how the 200dMA is currently capping price with bearish structure here, but momentum looks to have bottomed out and price is holding firm above 6400 satoshis as reclaimed support. Close through the 200dMA here and I think we take out 7800 into a new trendline retest. Break and close through that trendline and I think we’re ready for a run at 15k satoshis.


Blur:

BLUR/USD

Daily:

blurusddaily

BLUR/BTC

Daily:

blurbtc

Price: $0.58 (1434 satoshis)

Market Cap: $726.458mn

Thoughts: As Blur has only been trading for a little under a year, let’s focus here on BLUR/USD.

Looking at that pair, it is clear as day we are very much in the midst of its first bull cycle after its 90% drawdown in the bear market into its October 2023 bottom. Since, the pair has rallied into $0.67 in late November, consolidated above $0.40 support for a couple of months and is now rallying back through that $0.67 high, hitting $0.75 as support turned resistance a few days ago – aligned with the 50% fib of the bear market. Momentum looks to be with bulls once again, with $0.57 acted as reclaimed support here. I would expect to see continuation off this level through $0.75 into the 61.8% fib level and prior support around $0.90. If this level does not hold as support this week, I expect to see $0.48 retested. But fresh all-time highs are coming – it’s just a matter of time now…


Unibot:

UNIBOT/USD

Daily:

unibotusd

UNIBOT/BTC

Daily:

unibotbtc

Price: $78.11 (0.00193 BTC)

Market Cap: $78.061mn

Thoughts: As UNIBOT has only been in existence for 6 months, I will look solely at the Dollar pair here for clarity.

Looking at UNIBOT/USD, we can see that price had formed an all-time high at $242 in August, before beginning its first bear market, drawing down 86% into an all-time low in late October at $33. That low, however, was short-lived, with price immediately rallying back above multi-month range support at $45, with range resistance having formed around $78. Price recently emerged from that range, rallying into the 38.2% fib retracement and prior support at $110. From this level, the pair has rejected, retracing into that range resistance, now acting as support. Whilst we may not yet have fully found the bottom, I would expect a sweep of the recent swing-low into $72 to act as a spring, where any move off that level back above $80 would look very clearly like a bottom formation, from which I expect the pair to continue towards $164 before finding major resistance. If, however, we close back below $72, that looks distinctly more bearish, with a likelihood of a return to $55 at least from there, given the failed breakout of the range. To be honest, I am not too focused on short-term PA here, rather looking to hold this for price discovery during market-wide euphoria, likely many many months away yet.


LayerAI:

LAI/USD

Daily:

laiusd

LAI/BTC

Daily:

laibtcdaily

Price: $0.0094 (23 satoshis)

Market Cap: $3.005mn

Thoughts: As LAI has only been trading since March, I will look solely at the Dollar pair here (as has been the case with a few requests this week).

Looking at LAI/USD, we can see that price formed an all-time low at $0.0051 in October and then rallied into $0.021 in December, rejecting at prior support. Price has since been bleeding lower, breaking back below the 200dMA recently, turning support back into resistance and capping all rallies at trendline resistance from that December high. We have now returned to reclaimed support at $0.0093, with major support below at $0.0081. I am expecting a bottom to be found within this range, but those on the sidelines are better off awaiting a clean break and close through trendline resistance followed by a higher-low formation before jumping in. I am in from around $0.0105 on average and looking to hold for a cycle, so not overly concerned about the next few weeks – and with this being a microcap, I am very much in the moon-or-die camp. The pair hasn’t experienced a bull cycle, so I am looking for price discovery through $0.17 when this does get going…

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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