Market Outlook #88 (10th August 2020)
Hello, and welcome to the free edition of the 88th Market Outlook!
In this week’s post, I will be covering Bitcoin, Ethereum and BitTorrent.
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Market Cap: $219.558bn
Thoughts: Well, given the past few weeks that we’ve had, perhaps it comes as no surprise that the past week has been one of consolidation for Bitcoin, with price range-bound within the confines of the previous week.
If we look at the weekly, we can see this clearly, with price having remained inside the range of the week that initially broke out of trendline resistance and the much-discussed triple-top. Volume over the past week was a little lower but still higher than for much of June and July, which I would expect of a consolidation week, and price is now looking to retest and possibly break above the $12,188 high. As I mentioned in last week’s post, it would perhaps be healthy for the pair to consolidate for a little while longer between $12,200 and $10,600, but given current macro momentum this may not be the case. Whilst we remain above $10,600 the outlook remains very much bullish, with the next major area of resistance the $14k high that I’m sure everyone has their eyes on. If we break back below $10,600 and close the weekly below it, I would be looking for immediate rejection and a move back above the level the following week to hold a short-term bullish bias; anything else and I would assume price wants to retest $8,900 as support.
Turning to the daily, there isn’t really a great deal to add here except that we have just this past week seen the 200dMA cross above the 360dMA, which, though not as significant for BTC/USD as it is for altcoins, is still a bullish sign. If we do see a deeper dip, I’d be looking to long that 200dMA.
Price: $394.28 (0.0332 BTC)
Market Cap: $44.33bn (3,743,286 BTC)
Thoughts: Ethereum is currently in a very interesting position, with the potential for significant upside from here should it remain above some key levels.
Looking first at ETH/USD, from the weekly we can see that the week prior to last closed above the important $365 level, which was historical support turned resistance. Much like BTC/USD, the pair has consolidated above resistance and within the range of the breakout week on slightly lower volume. We remain well above the 200wMA and the previous high of $290 and trendline support is still a long way away. As such, if we do start to dip here, it is likely that price would seek out one of these key areas. However, if BTC keeps climbing, ETH will continue to outperform in my opinion, and that $550 area is of great interest as the next major resistance. Looking at the daily, again, there is not much to add here given where price is sat, but we can see clearly how long the pair could be sat just below $415 before it gets anywhere near a trendline support retest. Ultimately, I am looking for ETH to continue upwards as we get into Q4, but whether we get much more upside in August I’m not sure. Long and strong, nonetheless.
Turning to ETH/BTC, on the weekly I have highlighted two important areas of resistance as Ethereum continues higher, which I fully expect it to do given the steepening curve of the rally and the huge volume that came in a couple of weeks ago. The first of these is, in my opinion, the most important, and a close above 0.042 could prove the catalyst for the real ride to market-wide euphoria. Looking at the daily, we are currently at minor resistance but have retested the previous local high as support; above, it is clear skies to 0.042; below, I’d be looking for an opportunity to buy 0.0286. I’m not too worried about a potential break of the curve, as curves aren’t very reliable; this is merely to show the steepening rally without drawing several trendlines.
Price: $0.00047 (4 satoshis)
Market Cap: $311.92mn (26,235 BTC)
Thoughts: BitTorrent isn’t a project I know much about since its move into crypto, but the chart does appear to be looking upwards, having lagged many other sizeable midcaps recently.
Looking at BTT/USD, we can see that price has slowly recovered from the mid-March capitulation into a new all-time low and has recently close above the 360dMA for the first time in its history. I would be looking at $0.0006 as the major resistance, with a move above opening up clear skies to $0.00115.
Turning to BTT/BTC, much like a number of alts I’ve featured in these posts, the pair has never experienced a bull cycle since inception, with early trading culminating in a measly 3x rally before the long bleed began, with the all-time low coming in May 2020 at 3 satoshis. Price has held above this level for some time since, now looking to break above the 360dMA after rejecting it last month. Invalidation for new positions would be a close below the all-time low and I’d expect price to really start moving once its above 6 satoshis. Following this, there is resistance at the prior support ~12 satoshis.
And that concludes this week’s free Market Outlook.
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