Market Outlook #260 (21st March 2024)
Hello and welcome to the 260th instalment of my Market Outlook.
In this week’s post, I will be covering Bitcoin, Ethereum, Solana, Fantom, Illuvium and LooksRare, a couple of which were reader requests. It’s a slightly shorter post this week focusing on more of the movements of the majors – back to regularly scheduled programming from Monday.
As ever, if you have any requests for next week, please do let me know via email or in the comments.
Bitcoin:
Weekly:
Daily:
Price: $65,405
Market Cap: $1.285trn
Thoughts: Well, what a few days it has been…
If we begin by looking at the weekly for BTC/USD, we can see that price closed last week right below the previous all-time high at $68.4k, having wicked into fresh highs at $73.7k before rejecting. Price has since also rejected off that weekly open and sold off towards $59.2k, bouncing above it this week and now consolidating right around prior resistance turned support at $64.9k, which is a huge level to hold: this was the April 2021 high and holding above it here would look very much like the breakout, rejection and retest from the previous cycle’s all-time high break. Further, holding here confirms that the current parabola remains intact, leading to price discovery in April and May until we see the parabola break at some point. On this timeframe, there really isn’t a lot to be concerned with just yet. We have a regular pull-back from the most important level on the chart after a huge run-up that built up a lot of leverage in the market. This has pretty much been eviscerated this past couple of weeks and it is now a case of holding these higher timeframe support levels and continuing higher, in my view. Now, if we were to lose the $59k level and close the weekly below it, that would start to look more concerning – in fact, I would expect that to lead to a parabola break shortly after and thus likely a much longer period of consolidation and chop before continuation higher. One thing to add here is also that there is nothing yet indicative of exhaustion on this timeframe: spot volume is growing and momentum indicators are making higher-highs.
If we drop into the daily, I have marked out three scenarios I am considering here. The first is the most bullish, which is that a higher-low was marked out this week at $60.7k, above the $59.2k swing-low, with that bullish engulfing leading to the formation of a higher-low in the next few days above $61k, and then a breakout and reclaim of $69k, turning that into support before price discovery. The second scenario is that despite the bullish engulfing, price today has rejected at the prior all-time highs and failed to use that momentum to break above $68.9k, rejecting and turning lower. This could mark out a lower-high within this structure and lead to a flush of this week’s low, causing a small liquidation cascade through $59.2k into $58k before a sharp reversal begins from there back towards all-time highs in April, keeping the parabola intact. The third scenario is that we continue to fall from here through $61k, form another lower-high below $65k and then break the parabola, closing below $58k – this more bearish trajectory would lead to a longer period of consolidation and chop, with prices potentially going as low as $48k before marking out a bottom in summer and then beginning a new parabola from there into price discovery and beyond. Honestly, at present I have no certainty on any of these three, but if we start to close the daily below $64.9k and turn that level into resistance intra-week, I would expect the second scenario to become the most likely, liquidating a bunch of eager longs that jumped in after that bullish engulfing. I think the longer consolidation is certainly plausible, but I am currently leaning towards that being the least likely at present of the three. It’ll become more clear if we do get below $61k and see no real reaction from bulls…
Ethereum:
ETH/USD
Weekly:
Daily:
ETH/BTC
Weekly:
Daily:
Price: $3442 (0.05266 BTC)
Market Cap: $413.035bn
Thoughts: Beginning with ETH/USD, we can see that price rejected at reclaimed resistance around $3950 and then closed last week just above $3600, continuing to sell off this week below prior support at $3580 into $3034, before bouncing and now consolidating around $3440. There is absolutely nothing bearish about this structure on the weekly, with growing volume and momentum with no signs of exhaustion. At present, this looks like a standard pull-back following 6 weeks of rallying. In fact, we could pull back into $2721 and form a higher-low there and it would still look pretty good on this timeframe. That said, I don’t think the market is going to be kind enough to gift you $2700, but it illustrate the point of ETH’s structural strength here. If we drop into the daily, I have marked out the two scenarios I am looking at here, which will be determined by BTC I would image. The bearish scenario which does grant you $2700 and a period of consolidation and re-accumulation is likely if BTC/USD does break the parabola and lose $58k. The sharper recovery is more probable here, in my view, and we have already taken out that long wick into $3284 and trapped breakdown shorts, as well as liquidated a lot of longs, so I would be looking for the formation of a higher-low this week above $3284, following by continuation through $3580 next week into fresh yearly highs in early April, especially given how ETH shrugged off the SEC headlines yesterday. Only if we close the daily below $3284 do I think this v-recovery does not occur.
Turning to ETH/BTC, we can see that price sold off last week from the open into the close right above the 360wMA at 00.053 and this week found resistance at that weekly open, dumping into support at 0.051 and bouncing, now consolidating between the two levels. Whilst this doesn’t look pretty, it also doesn’t look ugly – it just looks like the worst chop of all time. We have something of a sweep of the most recent swing-low into demand and price looking like it wants to hold 0.051 here. If it can’t, and we close the weekly below 0.051, then it looks ugly, and we’ll likely need another deep flush of 0.049 into 0.046 before a real bottom forms. If, however, support holds here, then we are just waiting for that weekly lose through the trendline and for it to then hold as support the subsequent week. Looking at the daily, we can see that price broke below local trendline resistance this week on that dump into 0.051 and is now retesting 0.0533 as resistance. This will be the key test over the next day or two: reject here and turn lower and I think it’s unlikely 0.051 is holding again, and we’ll see the pair 5% lower from there; if, however, we can break and close back above that level, I think we take another stab at that trendline.
Solana:
SOL/USD
Weekly:
Daily:
SOL/BTC
Weekly:
Daily:
Price: $178.18 (0.002726 BTC)
Market Cap: $79.248bn
Thoughts: Beginning with SOL/USD, we can see from the weekly that price closed last week at fresh yearly highs, just shy of the September 2021 high at $213 and the 78.6% fib of the bear market. This week has seen a small pull-back off that area into the 61.8% fib at $170, with price wicking below it into $162 and finding support. I could see this pulling back as far as $140 before marking out a bottom, if the rest of the market is moving lower, and the pair would still look fantastic. If we drop into the daily, we can see the parabolic advance from the December 2022 lows and the steepening of the rally this past couple of weeks. Despite this, momentum indicators are showing no signs of exhaustion on the most recent push higher into $212, and this currently just looks like a textbook reset before continuation higher. If we do take out $162, I would expect a lot of demand to step in above $144 and mark out a bottom, from which the pair begins the leg into all-time highs. This could actually even consolidate for a few weeks without breaking that parabolic advance. As long as it holds, new all-time highs before May is most likely.
Turning to SOL/BTC, we can see that price is very tightly holding to its parabolic curve here, pushing off support at 0.00207 last week into fresh yearly highs, closing around the 61.8% fib of the bear market at 0.003. This week has seen a minor retracement off that level, but nothing to suggest a break of the parabola just yet. We do have some signs of possible exhaustion up here, but nothing concrete at present: this could easily bounce next week above 0.0026 and continue higher into 0.00377 after that with the parabola intact. If it does hold, we’re looking at fresh highs in summer. Dropping into the daily, we can see that price swept the 0.0029 high and found resistance, with that level now capping price. If we do see continuation lower off this level, I would be looking for that prior resistance at 0.00244 to act as support, leading to another breakout attempt beyond 0.003. Honestly, nothing majorly bearish at all on this timeframe. Just look for a higher-low formation and bid until the parabola breaks.
Fantom:
FTM/USD
Weekly:
Daily:
FTM/BTC
Weekly:
Daily:
Price: $1.07 (1632 satoshis)
Market Cap: $3.004bn
Thoughts: Beginning with FTM/USD, we can see on the weekly that the pair has been marching forwards this past few weeks, rallying through the 200wMA and turning it into support at $0.55 before breaking multi-year resistance at $0.64. This latter level also became support as price pushed higher, with this past week seeing the pair rally through a cluster of resistance below $1 into $1.14, where it did reject. As long as we can close the weekly above $1, I would expect continuation higher over the next few weeks here towards the 38.2% fib of the bear market and prior resistance between $1.51-1.66. Momentum indicators are also showing no signs of slowing down just yet. Dropping into the daily, we can see that there was some divergence on the past few pushes into resistance, and in classic bull market fashion these were invalidated as price closed through $0.98 and turned it into support, marking out a higher-high on RSI. From here, I am expecting to see some more consolidation between $0.91-1.1.14 over the next week or so before another leg higher into $1.50 in early April.
Turning to FTM/BTC, we can see that weekly structure is confirmed as bullish with a series of higher-highs and higher-lows since the October 2023 bottom formation. The past couple of weeks have seen the pair struggle at 1309 satoshis, wicking into the 200wMA at 1422 satoshis but rejecting and closing below that level twice. This past week price has finally broke through the resistance cluster, rallying into the next major resistance at 1730 satoshis, with momentum also pointing higher. From here, as long as we close the week above 1400 satoshis, I would expect price to consolidate a little and then run through 1900 satoshis into the 23.6% fib of the bear market and major support turned resistance around 2420 satoshis, which is where I would expect a local top to begin forming. Unless we now close back inside 1308, the trend looks very strong. Dropping briefly into the daily, we can see how some consolidation into a breakout might look, but the main thing to take away here is that the 360dMA is now support and there are no signs of momentum exhaustion up here. I am a Fantom bull for the foreseeable future.
Illuvium:
ILV/USD
Weekly:
Daily:
ILV/BTC
Weekly:
Daily:
Price: $130.03 (0.001989 BTC)
Market Cap: $822.166mn
Thoughts: Beginning with ILV/USD, we can see from the weekly that the pair has bottomed out and has formed strong bullish structure, with a higher high through $120 a couple of weeks ago into $162. Price then consolidated and has since flipped $121 into support, which is holding at present. I would now expect to see the next leg higher begin from here through $162 into fresh yearly highs,, with quite literally no resistance between there and the 200% fib extension of the trend around prior support at $240-260. Invalidation would be a weekly close back below that $108 level that had capped price for over a year. Dropping into the daily, we can see how strong daily structure is here and, whilst we did have some divergence on the most recent push higher, I believe this has played out on the dump earlier this week. We should now see a higher-low form above $120 and price to continue through from there towards $260 in the next few weeks.
Turning to ILV/BTC, we can see that the pair has spent the bulk of its existence in a downtrend, but following the all-time low formation at 0.00124 in October 2023, the pair rallied higher, reclaiming support at 0.0016 and turning weekly structure bullish. Price marked out a local higher at 0.0033, and has since retraced into 0.0016, which has held as reclaimed support for the best part of 2024. We are now range-bound between that support and prior support turned resistance at 0.00224, and I would expect upside resolution of this range given the weekly structure. If we get a weekly close through 0.00224, that is a very clear signal to buy spot with invalidation at 0.0015, looking to hold for a cycle, with a major target at 0.01.
LooksRare:
LOOKS/USD
Daily:
LOOKS/BTC
Daily:
Price: $0.131 (200 satoshis)
Market Cap: $130.877mn
Thoughts: As both pairs for LooksRare look pretty much the same given the relative lack of price history, let’s focus here on the Dollar pair.
Looking at LOOKS/USD, we can see how price has recently rallied through the 200dMA and 360dMA that had been capping prices, with the latter never having been traded above prior except a fake out in December 2023. We pushed higher and reclaimed support at $0.11 before price found resistance at a yearly high around $0.187. We have since retraced into $0.11, which is currently holding as support, and the broader trend is now pointing higher, with a series of higher-highs and higher-lows, as well as the beginnings of a parabolic advance. I would expect to see the next leg higher for LOOKS begin from here, taking the pair through $0.19 towards major resistance at $0.46, where the 2.618 extension of the current trend is also sat. The craziest thing, however, is how far off the highs we are – the 23.6% fib retracement of the bear market doesn’t even come into view until $1.65, with the 38.2% fib at the most important prior support turned resistance around $2.60. That latter level is where I am looking to hold this to, given the fact that LOOKS has never traded a bull cycle. I will look to exit most of my position around that level either late this year or early next and hold a little for a potential moon-shot at all-time highs. For the short-term, as long as we hold above $0.09 this looks fine for higher prices…
And that concludes this week’s Market Outlook. Back to full length next week!
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.
