Market Outlook #57 (23rd October 2019)
Well, it’s been a couple of weeks since the previous Market Outlook was published but the markets have, in general, been choppy during that time.
That being said, I will be covering this period’s price-action in Bitcoin, Ethereum and Monero, as usual, as well as looking to EOS and Basic Attention Token for possible signs of life for the altcoin market during this final quarter of 2019.
Let’s crack on:
Market Cap: $143.769bn
Thoughts: Despite the previous Market Outlook having been published two weeks ago, there isn’t much that has occurred in Bitcoin’s price-action, with price being range-bound between $7686-$8861 for 27 days.
Looking at BTC/USD on the Daily timeframe, however, we can see that price is lingering above a double bottom that I am expecting to be raided before we resume the uptrend, with price perhaps looking to test the 360-day moving average around $6800. Nonetheless, I am awaiting a breakout of this range before I take any decisions, as a Daily close above the resistance at $9,080 would change my mind and I would be very much convinced that the market has formed its intermediate bottom. A breakout to the downside, however, would see prices reach for that liquidity sub-$7400; print a swing-failure here and I will look to get long; either way, I will be buying spot below $7400.
Looking at the hourly chart, most of the recent action has clearly been chop, but the swing-failure that formed two days ago at $8,360 makes me think that $7,866 will be cleared out next before any more significant direction is decided. Eyes on range support…
Price: $167.10 (0.0209 BTC)
Market Cap: $18.124bn (2,266,339 BTC)
Thoughts: Ethereum has spent the last couple of weeks in similar chop, having made no net progress against BTC or USD since the beginning of the month, effectively.
Looking at ETH/USD, we can see that despite price reclaiming the 360-day moving average this month, it has since fallen back below, remaining trapped below more recent trendline resistance, although it did breakout above significant resistance in September and print a swing-failure on the retest; usually, these are bullish conditions. That said, given my expectations for Bitcoin, I would like to see ETH/USD flush $151 and print another swing-failure, strengthening the bullish outlook for the pair going forward; this is where I would look to get long. This idea is invalidated if price closes above the high around $200.
Looking at ETH/BTC, we can see the high that formed earlier this month at 0.023 BTC, from which price has slowly descended; I am expecting a further dip and retest of 0.02 BTC, followed by bullish continuation going into year-end to test 0.0245 BTC resistance. If price breaks and closes the Daily below that swing-low at 0.0188 BTC, however, I would expect further bloodshed and a move back towards the 0.0161 BTC lows.
Price: $56.42 (0.00706 BTC)
Market Cap: $974.51mn (121,216 BTC)
Thoughts: Monero has remained the laggard for most of October, up until a few days ago when it showed signs of life in its XMR/BTC pair.
However, looking at XMR/USD to begin with, we can see that the pair remains comfortably below trendline resistance from July, as well as below the pivot zone around $57.50. It has made a number of attempts to break above $59 but failed each time, and with BTC/USD looking how it is, I would expect to see new lows printed in XMR/USD.
That being said, XMR/BTC bounced back into life last week as a huge influx of volume hit the market and drove price up from the lows of 0.0063 to 0.0074 resistance. Nonetheless, price failed to reclaim this pivotal support-turned-resistance. Until it can do so, I am not expect much of Monero; I will change my mind once this level is reclaimed.
Price: $2.89 (36,060 satoshis)
Market Cap: $2.712bn (337,323 BTC)
Thoughts: EOS is looking like a stronger Ethereum at the moment, with even recent downside being less pronounced than in the latter.
Looking at EOS/USD, as with other altcoins it remains capped beneath strong trendline resistance from the summer and is lingering ~10% above the lows of $2.58. The most important level here, for me, is $3.30, which has acted as support and resistance numerous times in recent history; until EOS/USD breaks above this level, I wouldn’t expect too much upside against the Dollar, particularly with how Bitcoin is looking at the moment.
Where I do expect to see some strength, however, is in EOS/BTC. Price remains range-bound between the lows at 0.0003 and the resistance formed at 0.000415; that said, given my macro expectations for altcoins in Q4 and the expectations I have set out for EOS/ETH in prior posts, I am now expecting to see EOS begin to outperform Ethereum, in particular, and perhaps make a new local high in November. This should be followed by general outperformance of altcoins against BTC. We shall soon see…
Basic Attention Token:
Price: $0.24 (3,021 satoshis)
Market Cap: $328.191mn (40,812 BTC)
Thoughts: On the topic of altcoin outperformance, it is quite clear to see that BAT is taking matters into its own hands of late, with its recent price-action appearing much like the beginnings of a new market cycle.
As can be seen in the chart provided, price has rallied 100% from the depression lows at 1,500 satoshis and is pressing right up against significant support turned resistance at 3,000 satoshis. The 200-day moving average lingers above, as, I expect, does disbelief…
If BAT can break and close the Daily above these key levels, I expect we will see the cycle begin to accelerate all the way into euphoria going into 2020.
And that concludes this week’s Market Outlook. I hope you’ve enjoyed the read!