Market Outlook #34 (Altcoin Special)

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Market Outlook #34 (7th May 2019)

Hello, and welcome to part two of this week’s Market Outlook. For those who missed the first part, which dealt exclusively with Bitcoin, Ethereum, Monero and Dash in extensive detail, you can find it here.

In this post, however, I will be covering Stratis, Komodo, Ark and Ardor. These are four of the larger mid-to-largecap altcoins I’m invested in, and I think they largely reflect the nature of most of the altcoin market at present.

Strangely, whilst most of the market is at ALT/BTC lows, I do not think the bloodshed is quite over yet, as my expectations for an imminent short-term top in Bitcoin give me reason to believe we’ll see more blood when BTC retraces. Altcoins will have their time to shine, but it’ll take either a period of consolidation or a slow and steady rise in Bitcoin (above the $6k resistance) before that occurs. Volatility and uncertainty in Bitcoin is generally not so good for alts…

Stratis:

STRAT/USD

STRATUSDWeekly

STRATUSDDaily

STRAT/BTC

STRATBTCWeekly

STRATBTCDaily

Price: $0.82 (13787 satoshis)

Market Cap: $81.175mn (13,693 BTC)

Thoughts: Stratis has a lot going for it fundamentally (as do the rest of the four coins featured in this post) but its chart now looks horrific. Just two weeks ago, it was one of the stronger looking charts…

Now, let us take a look at the Weekly chart for STRAT/USD for some context:

Trendline resistance that was in play for a year was broken going into 2019 and price successfully retested it in January. As such, there is a strong possibility that the cyclical low was formed at $0.53 last year. Since then price has found resistance at an historical level of support, $1.34.

Looking now at the Daily chart, we can see the breakout from trendline resistance occurred on high volume and that mid-term support has formed around $0.73. However, STRAT’s climb above the 200-day moving average was shortlived and price now sits in a precarious position with at least 30% of room to fall before it reaches the low from December 2018. If Bitcoin does retrace towards the low $4k area, STRAT/USD would undoubtedly be dragged down towards this potential support level.

STRAT/BTC looked rather comfortable above 21k satoshis in April, but, looking at its Weekly chart, we can see that it now looks a little grim:

18-month trendline resistance was broken in December, and price found resistance at support turned resistance around 40k satoshis. Following this, it retraced towards 21k satoshis where it sat, presumably in re-accumulation, for a couple of months. However, late April brought with it a breakdown from this support level and price has continued to fall, breaking and closing the Weekly below the November low of 15k satoshis. It seems to me to be painting something of a spring as it seeks to test the trendline resistance as support once more, though this time around 12k satoshis.

Looking at the Daily chart, we can see where price lost the 200-day moving average followed by a fall through the significant 0.0002 BTC level. The subsequent sell-off has been steep but very low in volume, indicating that a move into historical resistance at 12k satoshis from 2017 will likely be a good place to buy. However, low-risk buyers would wait for a rejection and break of the bearish market structure before an entry. I have depicted the path I expect Stratis to take on its Weekly chart, though I expect movements to be more explosive than shown if late Q2/early Q3 is when alts get some relief.


Komodo:

KMD/USD

KMD/BTC

KMDBTCWeekly

KMDBTCDaily

Price: $1.10 (18567 satoshis)

Market Cap: $124.511mn (21,000 BTC)

Thoughts: Komodo looks relatively strong compared to other alts, though it suffered from a great deal of downside of late too. Looking at KMD/USD on the Weekly timeframe, it is evident that price is lingering around serious resistance but remains above its 20-week moving average. Again, given the significant relationship between Bitcoin’s price at ALT/USD prices, I expect KMD/USD to be dragged back towards trendline support (and perhaps briefly under it) as Bitcoin finds a short-term top.

Now, let’s take a look at the Weekly chart for KMD/BTC:

10-month trendline resistance was broken and retested prior to 2019, after which price rose steadily, respecting its trendline support. It found resistance at prior support around 28k satoshis, retracing hard towards the trendline, which then gave way. What has followed is a move back into what is clearly an area of historical accumulation for all of Komodo’s bull cycles.

From the Daily chart, we can see that price is lingering within this range, above support at 17500 satoshis, but if Bitcoin sneezes I expect this level to give way and KMD to move towards 15700 satoshis. I do, however, expect the November low at 13400 satoshis to remain intact as a cyclical low. A move above 21500 satoshis would confirm the reversal.


Ark:

ARK/USD

ARKUSDWeekly

ARKBTCWeekly

ARK/BTC

ARKBTCWeekly

ARKBTCDaily

Price: $0.49 (8191 satoshis)

Market Cap: $54.54mn (9,178 BTC)

Thoughts: Ark is another coin that looked very strong against Bitcoin in Q1 but has suffered a deep retracement towards November lows.

The Weekly chart for ARK/USD depicts the breakout above support turned resistance at $0.50 and the 20-week moving average in Q1, following which price found resistance at $0.90. It has since fallen towards trendline support and the 20-week moving average has been lost. Further, it is sitting at the reclaimed level of support at $0.50.

Looking now at the Daily chart, we can see price flirting with trendline support, but also that the 200-day moving average has also been lost. Multiple Daily closes below support indicate that there is further downside to be had, and a close below $0.45 would open up a move towards $0.36.

But what about ARK/BTC? Well, as can be seen in the Weekly chart, price is sitting just above the first ever Weekly orderblock, which preceded the 2017 bull cycle. This is likely a great area for low-risk, high-reward accumulation, and the successive bearish Weekly candles suggest to me that we will see the local low at 7300 satoshis taken out before price rejects, acting as a spring for a new cycle to begin.

I have depicted this on the Daily chart, where we can also see the series of significant levels of support that have been lost recently. A move back above 9500 satoshis would indicate that a bottom has been found, but I expect we shall see price wick below 7k before that happens.


Ardor:

ARDR/USD

ARDRUSDWeekly

ARDRUSDDaily

ARDR/BTC

ARDRBTCWeekly

ARDRBTCDaily

Price: $0.07 (1176 satoshis)

Market Cap: $69.6mn (11,753 BTC)

Thoughts: Finally, we have Ardor. One particularly interesting feature of Ardor’s price-history can be found on the Weekly chart for ARDR/USD, where I have depicted a very similar fractal that seems to be playing out from late 2016/early 2017. Further, the 5-month trendline support is being respected by the Weekly candles, but its fortunes are largely tied to the movement of Bitcoin. We can clearly see numerous levels of support becoming resistance, with the most recent resistance found at $0.09.

Looking now at the Daily chart, we can see that there is actually a little room to fall before Ardor tests its trendline support against the Dollar. Further, it also just about holding onto its 200-day moving average and holding above resistance turned support at $0.067. However, again, unless Ardor massively outperforms Bitcoin, a retracement in BTC/USD will certainly bring ARDR/USD below these areas of support, perhaps towards $0.50.

The ARDR/BTC chart, however, is a work of art, as price has moved back into the original accumulation zone from 2016. I have painted a price trajectory on the Weekly chart. It is, however, paramount that Ardor holds above 900 satoshis, which is its all-time low. A move below that would open up bearish price discovery. Whilst Ardor holds within this range, it is likely a rewarding opportunity to accumulate.

Finally, looking at the Daily chart, I have shown where Ardor broke its uptrend against Bitcoin and lost its 200-day moving average. The subsequent dump has been extensive, bringing price all the way back to the November low above 1100 satoshis. The recent rejection of a move below this does suggest that a double bottom may be forming, but I expect this low will be swept in a similar spring-like fashion to that which we are seeing across-the-board in alts.

And that concludes this lengthy second part to this week’s Market Outlook. I hope you’ve enjoyed the read.

As ever, feel free to leave any comments or questions below.


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Market Outlook #30

AD: Before I begin this post, I’d like to briefly mention Bitcoin.Live, who are sponsoring my blog.

Bitcoin.Live offers regular, detailed content on their free-to-access blog, created by a panel of analysts (including Peter Brandt), and covering all manner of market-related topics. I found both the video material and the blog posts to be genuinely insightful, with many differing analytical perspectives available for viewers and readers. The platform also offers premium content for paying subscribers who find value in the free material, with daily videos, alerts and support provided. Check it out and bookmark the blog.


Market Outlook #30 (7th April 2019)

Hello, and welcome to the 30th Market Outlook. It’s been a very busy week in and out of the markets, with the primary talking point naturally being the 23% upwards breakout in Bitcoin in the early part of the week. We shall, of course, be covering that in great depth, but there’s plenty else to discuss…

In this week’s post, I’ll be looking at the past week’s price-action in Bitcoin, Ethereum and Monero, plus providing an update on Komodo.

Let’s crack on:

Bitcoin:

Price: $5160

Market Cap: $90.99bn

Thoughts: So, it seems Bitcoin decided to ignore the expectations I put forth in last week’s post of a gentle, sustained rise over the course of the week, and instead went for the explosive breakout. In the space of about two hours at the beginning of the week, price moved from ~$4100 to ~$5100; a near-25% jump. Volatility of this kind has not been seen for months, and bullish momentum to this degree has not been seen for over a year.

Looking at the first Weekly chart provided, it seems to be the case that Bitcoin is indeed playing out a similar (but not identical) price fractal to the bear market of 2014/15. The tightening of the gap between the 20-week moving average and the 200-week moving average led to an upside breakout from trendline resistance back in 2015, just as it did this past week. This breakout led price towards a level of support turned resistance at around $320 in the summer of 2015, initially followed by a rejection and retest of the 200-week moving average.

Now, if something to that effect was to play out, we should see price reach for just shy of $6000, reject hard and retest the Weekly 200MA at around $3500 over the next few months. This would provide strong support, allowing for a bullish continuation and a break back above the key $6000 area towards the end of the year. Whilst I do not expect price-action to be quite so tidy, I do believe this will be the general direction of the market for the remainder of the year.

Looking now at the second Weekly chart provided, we can see a clear and strong breakout from January 2018’s trendline resistance on significant volume, indicating to me that the cyclical low is indeed in. I have gone out on a limb in previous posts and mentioned that I believed we had found the cyclical low above $3000, but, to me, this confirms that theory. Further, we have also broken out above range resistance that has been in play since November 2018.

Finally, looking at the Daily chart, we can also observe that price has closed above the 200-day moving average (often a reliable proxy for relative bullishness or bearishness), but that there is much to be wary of in the short-term. There is now significant overhead resistance between $5500-6000 and RSI is the highest it has been on the Daily timeframe since the beginning of the bear market in January 2018; now, indicators are by no-means a be-all, end-all, and I do not value them above price-action or volume itself, but there is enough indication here across all possible analytical perspectives that Bitcoin needs a bit of a breather.

In truth, I do not expect the first dip to be of any significance, unlike those that believe we retrace the majority of this entire past week’s movement – instead, I see price dipping towards $4800, before making a move up to test that heavy overhead resistance zone. It is from this area that I think we see the hard rejection that leads to a move back towards $4400 and likely below that. However, this is a scenario that I believe will play out over the course of the next couple of months rather than next week.

Next week, I think we see some more consolidation between $4800-5300 – but we still have tonight’s Weekly close to concern ourselves with…


Ethereum:

ETH/USD

ETH/BTC

Price: $168.11 (0.03271 BTC)

Market Cap: $17.745bn (3,444,267 BTC)

Thoughts: Ethereum is in a very interesting place at the moment, given the dump that occurred in ETH/BTC courtesy of Bitcoin’s movements over the past week. Firstly, looking at the ETH/USD Weekly chart, we can see that price is still being capped by trendline resistance from January 2018, unlike with Bitcoin, but also that price looks to be ready to close strongly above the 20-week moving average for the first time since the bear market began. Price also remains capped by support turned resistance at ~$170.

The first Daily chart I’ve provided shows the relationship between the 20-day and 200-day moving averages on ETH/USD throughout its price-history, and we can clearly see that Ethereum’s bull market began when the former crossed the latter in February 2017. Looking now at the recent price-action, we can see the same cross inching closer to occurring. Price did consolidate for a good week or two before taking another leg up after this cross took place in early 2017, so perhaps we shall see some consolidation over the next week also.

The second Daily chart gives us a much closer view of recent movements, with a clear rejection from closing below the 200MA but a lack of willingness to close above trendline resistance or horizontal resistance; again, much like Bitcoin, this is an area with a lot of overhead resistance.

Looking at the ETH/BTC chart, we can get a clearer idea as to what Ethereum can be expected to do next. Price is currently in a contentious area, struggling to spend much time above or below the trendline resistance. This past week took price below the 200-day moving average for the first time since February, but only briefly, with price now trailing it almost to the satoshi. The uptrend from December has been lost on significant volume, which is not a particularly good sign, and yet the explanation of such a move is simple; the unanticipated short-term volatility that occurred in Bitcoin. I expect that the level I have marked ‘critical support’ at 0.0298 BTC will hold, with price consolidation whilst Bitcoin figures out its next move, followed by a continuation of bullish momentum; in fact, this, for now, is simply a higher swing-low.


Monero:

XMR/BTC

Price: $69.75 (0.01352 BTC)

Market Cap: $1.179bn (228,505 BTC)

Thoughts: Unbelievable… I finally have something to say about Monero after 106 days of range-bound price-action. This past week saw the range broken to the upside on significant volume, with the 200-day moving average providing resistance. Following this, price rejected hard and dumped back into the range, all the while remaining above short-term support at 0.0128 BTC. Now, it seems as though Monero wants to escape the range once again, but I expect some more consolidation around range resistance at 0.0136 BTC before the 200-day MA is tackled again.


Komodo:

KMD/BTC

Price: $1.23 (23,878 satoshis)

Market Cap: $138.509mn (26,867 BTC)

Thoughts: Much like the rest of the entire market, it is clear that the Bitcoin volatility was unexpected for Komodo holders, and many jumped to sell their coins for whatever reasons they believed made sense in their own heads…

Clearly, large holders (or so-called smart money) did no such thing, as the volume on the dump is barely visible on the chart, and price remains above the range breakout level at 22500 satoshis. I expect perhaps some more dumping by weak hands if Bitcoin does make another 5-10% move upwards next week, but that the uptrend will remain intact and that any move below 22500 satoshis will be shortlived. Over the coming weeks and months, the direction seems clear to me.

And that concludes this week’s Market Outlook. I hope you’ve enjoyed the read.

As always, feel free to leave any comments or questions below!


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Market Outlook #23

Market Outlook #23 (17th February 2019)

Welcome to the 23rd Market Outlook. Following last week’s post, we seem to have gotten some decent follow-through in places, alongside some cases of rejection at important levels of resistance. Overall, however, bullish sentiment seems to be picking up across-the-board, and plenty of altcoins have begun their cyclical reversals.

In today’s post, I’ll be working through the past week’s price-action in Bitcoin, Ethereum and Monero, as usual, followed by a couple of altcoins that I believe will follow the trajectory of those like Ark and Vertcoin, which have recently moved 2-3x from their lows in short-term spikes. These, keep in mind, are the beginnings of reversals.

Bitcoin:

Price: $3755

Market Cap: $65.873bn

Thoughts: Bitcoin spent the vast majority of the week consolidating after breaking market structure to the upside last week. Just this morning, it burst out of consolidation, but a breakout is unconfirmed until we get a 4H close above the short-term trendline resistance. If we do see such a breakout, and ideally on more significant volume than at present, I believe we will see BTC approach those equal highs ~$4200 soon after.

Looking at the Daily chart, we can see that price is currently being capped by mid-term trendline resistance, and remains within an important pivot area. Reclaiming this area and breaking out above it on the higher timeframes is what we need to see to confirm another leg up.


Ethereum:

ETH/USD

ETH/BTC

Price: $127.93 (0.03498 BTC)

Market Cap: $13.417bn (3,669,555 BTC)

Thoughts: Ethereum continues to look bullish against the Dollar, recently breaking out above 6-month trendline resistance, though not on particularly significant volume. Despite this, it seems as though the move below the $116 support was indeed a fakeout, with price explosively reclaiming levels beyond it since. The 4H actually illuminates the volume profile more clearly, with significant volume occuring on the upwards movements. A 4H close above $132 would make it all but inevitable for price to retest those recent highs (and significant resistance) around $170.

Looking at ETH/BTC, we can see that the local highs at 0.042 BTC were capped by the Daily 200MA, and that price is once again attempting a breakout above the moving average. This is taking place after a significant reversal from the move below 0.0318 BTC, but declining volume on this uptrend is a worry. I’d like to see volume return with a Daily close above the 200MA and above the swing-high at 0.035 BTC to confirm a retest of those highs at 0.042 BTC.


Monero:

XMR/BTC

Price: $47.47 (0.01291 BTC)

Market Cap: $797.396mn (216,871 BTC)

Thoughts: Well, what can I say… Monero seems to be the new Litecoin, rock-like in its determination to remain inside the range it has formed. This past week, we saw price attempt a breakout but price quickly returned to the range; Monero is clearly still in accumulation.


Komodo:

KMD/USD

KMD/BTC

Price: $0.80 (21790 satoshis)

Market Cap: $89.737mn (24,374 BTC)

Thoughts: Komodo is perhaps amongst the handful of opportunities at present that encompasses both fundamental and technical strength in abundance. KMD/USD has recently broke out above trendline resistance from January 2018 on high volume, though remains capped by the 200MA.

If we look at the first chart for KMD/BTC, we can also see that, in the past, Komodo has traded below 22.5k satoshis twice, and when that level was reclaimed with a Daily close above it, a new bull cycle began. It is currently at the edge of a third occurrence, and though market conditions are certainly dissimilar to those of the previous two occurrences, this is nonetheless a low-risk, high-reward opportunity. Perhaps we won’t see quite as explosive a bull cycle this time, but, then again, Bitcoin is trading at similar prices to those of the first bull cycle that occured in Komodo.


MonetaryUnit:

MUE/BTC

Price: $0.014 (380 satoshis)

Market Cap: $2.098mn (576 BTC)

Thoughts: Having written a Coin Report on MonetaryUnit previously, and knowing it has fundamental qualities that few projects in its market-cap range possess, it is even more pleasing to see a potential triple-bottom forming here.

MUE/BTC has seen numerous high-volume buyups over the past few months, and has refused to trade below 300 satoshis during that time. Buys here with soft stop-losses on a Daily close below 300 seem a good idea to me.


Kore:

KORE/BTC

Price: $0.37 (10158 satoshis)

Market Cap: $801,426 (218 BTC)

Thoughts: This is a proper Bittrex low-cap, and one of the shitcoin plays I most like. I know little of its fundamentals but I like that Kore is at historical support, and has experienced several high volume buyups since November. Price is currently range-bound, with 16-month trendline resistance edging closer and closer. Price is also trailing just below the Daily 200MA. For the more risk-averse, waiting for a Daily close above 14k satoshis is likely a good plan, but, as can be seen in the left side of the chart, Kore moves explosively.

That concludes this 23rd Market Outlook. I hope you’ve found some value in the read. Feel free to leave any questions or comments below and I’ll get back to you!


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