Market Outlook #20

Market Outlook #20 (27th January 2019)

Welcome to the 20th Market Outlook. That’s somewhat of a milestone, is it not? And what does the past week of price-action present us by way of celebration? In short, f all.

Whilst not technically true, we have just witnessed another week of consolidation amongst Bitcoin, Ethereum and Monero, and price-action at present is extremely choppy on the lower timeframes. We are mostly still range-bound, but the consolidation in Bitcoin is proving to be of service to the rest of the market, with many alts either beginning to pop or looking as though they are on the precipice.

In today’s Market Outlook, I will take a granular look at the market structure in Bitcoin, in an attempt to show just how choppy and uncertain it is currently, and how traders are being destroyed left, right and centre. I’ll then examine Ethereum and Monero, before presenting a couple of opportunities in Komodo and, most interestingly, Golem.

Bitcoin:

Price: $3596

Market Cap: $62.946bn

Thoughts: Bitcoin continues to bounce between lower timeframe levels of support and resistance, effectively range-bound between $3560 and $3750 for the past two weeks (excluding the anomalies; the high at $3886 and the low at $3460).

As such, I figured it would be useful to do a move-by-move study of price-action across this period, observing, in particular, how often (and how mercilessly) price shifts market structure on the 4H:

Towards the end of 2018, we can see a series of higher-lows forming (and with them trendline support). These are met with lower-highs, with the range contracting until the breakout in the first week of January 2019. This high-volume breakout shifted the market structure to bullish from neutral by forming the first higher-high since before the New Year. This then led to another period of consolidation and a contracting range, with price failing to make any new highs above ~$4210.

A lower-high is followed by a lower-low and another lower-high, leading to another break in market structure on the 10th January; this time turning it bearish. This was also the moment price broke the trendline support that had been in play since around Christmas.

This led to a dramatic dump, and a series of lower-highs and lower-lows, typical of bearish market structure. We then see price surge up on the 14th January and form a higher-high, once again shifting market structure to bullish. This is followed by a few days of chop and consolidation, before a higher-high is made at $3886 on the 19th. One could be forgiven for expecting this new high to be met with a higher-low, as is typical of bullish market structure, but once again expectations were demolished and price broke below the previous low at ~$3650; market structure was once again bearish.

This shift brought with it the low at ~$3450 this past week, which has been followed by another period of consolidation. This was the case until yesterday, when price broke above $3650 once again, reclaiming the lost level and turning market structure bullish with a higher-high at $3750. Price has since formed a higher-low (which I have mistakenly marked a lower-low on the chart) at $3600. Will this be met with a new high or another change in market structure, back to bearish?

In truth, I cannot possibly say. The declining volume on the recent retrace back into the range suggests we may get another leg up, but given all that I have outlined above, this is no certainty. The most risk-averse way to play this would be to wait until the market shows you the direction it wants; this will come either in the form of a higher-high, after which it would be logical to expect the highs at $4200 to be targeted; or in the form of a clean break below $3550, ideally with a higher timeframe close below this level, indicating further downside to be found and a good area for shorts to enter.


Ethereum:

ETH/USD

ETH/BTC

Price: $116.07 (0.03227 BTC)

Market Cap: $12.126bn (3,375,084 BTC)

Thoughts: Much like Bitcoin, Ethereum is yet undecided on a clear direction. Against the Dollar, it is clearly range-bound between $116-$120, failing to close above or below these levels on the 4H or 1H over the past week.

Sometimes it is useful, even in tight periods of consolidation, to remind ourselves of the higher timeframe view. As such, ETH/BTC on the Daily shows us that we have bled below the Daily Breaker, just about, but that we are still well within the Daily Bullish Orderblock, with key support resting at 0.0313 BTC. The 4H shows us the gradual downtrend of the past two weeks that has led us to this point.

I have illustrated the two moves I am waiting for before taking any trade on ETH. The bullish scenario would be a clean and strong breakout above this 4H downtrend, ideally on significant volume, at which point I would go long on a retrace with my sight set on 0.042 BTC being taken out. The bearish scenario would be for price to break below this current channel, forming a higher timeframe close below the key support at 0.0313 BTC. This would turn the Daily to bearish, and shorts could be found on a retest of this prior support, which would be expected to hold as resistance.


Monero:

XMR/BTC

Price: $45.84 (0.01274 BTC)

Market Cap: $767.835mn (213,410 BTC)

Thoughts: Monero remains less decisive than even Bitcoin or Ethereum, slowly trending upwards but doing little to comba tthe trendline support turned resistance that has been in play since mid-December 2018.

A clean breakout above trendline resistance and above 0.0137 BTC would turn market structure bullish, and I’d be buying; a strong rejection from trendline resistance and a subsequent clean break below 0.0122 BTC and I would be selling what I currently hold.


Komodo:

KMD/BTC

Price: $0.685 (19074 satoshis)

Market Cap: $76.45mn (21,281 BTC)

Thoughts: Komodo looks very much ready for a move above range resistance at ~22k satoshis. It has been denied a higher timeframe close above this level for the past 5 months almost, trading between it and range support at 15.5k satoshis. During that period, Komodo has experienced high volume on buyups, followed by low volume retracements back to range support. More recently, however, price broke above its 200-day moving average on significant volume, being restrained only by range resistance. Price subsequently retraced on declining volume back to the 200 MA, holding firm around this level; now looking to make another attempt at a breakout from the range.


Golem:

GNT/BTC

Price: $0.065 (1820 satoshis)

Market Cap: $63.020mn (17,541 BTC)

Thoughts: I have no idea how it has taken until the last week of January for me to take a look at Golem, but the past 8 weeks have seen it experience insane volume. Price set a high just shy of 3000 satoshis at the beginning of December 2018, during which period 74% of Golem’s circulating supply was traded across all exchanges. This was followed by a move lower and the formation of a range between 1700-1900 satoshis for over a month. This range remains in play, and, during this period, Golem has experienced cumulative volume of over 317% of its circulating supply. If that isn’t a sign of serious interest at current prices, I have no idea what is. I will certainly be buying in this range.

That concludes the 20th Market Outlook. I hope you’ve found it somewhat useful! Feel free to leave any comments or questions below and I’ll get back to you.


If you’ve enjoyed this post and want to receive new posts straight to your inbox, I’ve set up a RSS-to-Email feed that will be sent out weekly; every Monday, 12pm. You’ll also get infographic Coin Reports and other material not published to the blog. Just submit your email and I’ll make sure you’re included in the list. Cheers.

Market Outlook #17

Market Outlook #17 (6th January 2019)

Happy New Year, everyone! Welcome to the 17th Market Outlook, and the first of 2019. Having taken a two-week break over Christmas, it seems I missed a lot of interesting action; in particular, that of Ethereum, as we’ll discuss shortly. Overall, it looks to me like the signals that appeared in  early December in anticipation of short-term reversals are finally bearing fruit across-the-board…

In today’s post, I’ll cover the past couple of weeks of price-action in Bitcoin, Ethereum and Monero, as well as Stratis and Komodo. Let’s crack on:

Bitcoin:

Price: $3901

Market Cap: $68.135bn

Thoughts: So, it’s been a good three weeks since the last Market Outlook, in which I suggested that a short-term bottom was nearby. Since then, Bitcoin has moved from ~$3200 to just shy of $4400 and back to around $3700. Price then consolidated after the period of volatility and has now found short-term resistance at $4115 (a level of prior resistance), with higher-lows forming with each test; this, in essence, is an ascending triangle, but volume is currently flat, so we can’t be 100% confident in a breakout to the upside.

That being said, the 1H chart clearly shows a lot of swing highs in the $4100 region that remain unswept, and with price having already cleared the swing-low at $3875, it is likely that we will see continued bullish price-action. However, I wouldn’t rule out the possibility of a false breakout to the downside, with price looking to trade inside the 1H bullish orderblock at $3825 prior to making any further upwards progress…

Ethereum:

ETH/BTC

Price: $153.49 (0.0399 BTC)

Market Cap: $15.943bn (4,162,730 BTC)

Thoughts: Ethereum has experienced a tremendous reversal, having swept the September lows at ~0.027 BTC early in December. The Weekly shows us that price failed to break the long-term support at ~0.023 BTC, and the reluctance to make new lows has led us to a near-60% rally against Bitcoin. In the process of rallying, ETH has broken through numerous short-term resistance levels on significant volume, with the most important move occuring towards the end of 2018, when price broke above 0.034 BTC, thus breaking the bearish market structure. Price has since held that level, moving up through the resistance at 0.0375 BTC. Volume is declining on the Daily, however, suggesting that this current leg may be overextended. I would expect a period of relief, in which price moves back towards 0.036 BTC; but, make no mistake, it is very much likely we have found the cyclical bottom for ETH/BTC.


Monero:

XMR/BTC

Price: $50.35 (0.0315 BTC)

Market Cap: $840.794mn (219,575 BTC)

Thoughts: Monero has had a more relaxed few weeks, but also seems to have found a bottom. The Weekly shows us that price remains within the bullish orderblock from October/November 2017, failing to break below the support at 0.0111 BTC despite the extended downtrend. This downtrend has now been broken, as is clear from the Daily, and it looks as though an Adam & Eve bottom is forming with a neckline at ~0.0135 BTC. I expect Monero to take the reigns from Ethereum soon and rally towards the support turned resistance at 0.016 BTC. But first, we need a close above 0.0141 BTC to confirm the bullish market structure.


Stratis:

STRAT/BTC

Price: $1.07 (27939 satoshis)

Market Cap: $106.086mn (27,705 BTC)

Thoughts: Any regular reader of this blog will know that I am very fond of Stratis, having mentioned it in multiple posts. Around Christmas, Stratis experienced a huge buyup, after spending some time trading below range support. In that period, around a third of Stratis’ circulating supply was traded across all exchanges, and price blasted through the consolidation range, up to a peak around 42500 satoshis. In doing so, it cleared major resistance below 30k satoshis on significant volume. I would expect this area between 27-30k satoshis to become a new level of support. The recent drop-off after the peak has occured on ever-decreasing volume, suggesting that a new swing-low should soon form and, with it, a new leg up should begin.


Komodo:

KMD/BTC

Price: $0.77 (19975 satoshis)

Market Cap: $85.268mn (22,239 BTC)

Thoughts: It is somewhat rare to spot such an obvious buy as Komodo. Price has been in a large range for a long time, with rising levels of volume and clear accumulation taking place. Range resistance continues to hold at 23k satoshis, but this is one to buy on any movement back towards range support around 16k satoshis. There’s really very little else to say about this one except that the opportunity is made overt by the chart.

That concludes this instalment of Market Outlook. I hope you’ve enjoyed the read and found something of value here. Please feel free to leave any questions or comments below!


If you’ve enjoyed this post and want to receive new posts straight to your inbox, I’ve set up a RSS-to-Email feed that will be sent out weekly; every Monday, 12pm. Just submit your email and I’ll make sure you’re included in the list. Cheers.

Market Outlook #12 (Altcoin Special)

Market Outlook #12 (19th November 2018)

So, following on from Saturday’s Market Outlook, which dealt exclusively with Bitcoin, Ethereum and Monero, this twelfth instalment of the series will be an ‘Altcoin Special’. In that previous post, I mentioned that we’d likely be seeing some new lows on the big three, and this morning brought with it a fresh load of blood. ETH/USD, in particular, has broken below September support. But we’ll save all that messiness for next weekend’s Market Outlook.

In this post, I’ll be covering a dozen altcoins, looking at the strength or weakness they’ve shown during the past week of destructive price-action in Bitcoin. Some coins seem to have fared surprisingly well; others, less so. In order, I’ll be looking at Stratis, Ardor, Ubiq, SALT, Ark, Waves, BlockNet, Siacoin, Komodo, ALQO, FoldingCoin and Musicoin.

Stratis:

STRAT/BTC

Price: $0.89 (17222 satoshis)

Market Cap: $87.909mn (17,067 BTC)

Thoughts: Stratis has recently dropped below the range it had formed, sweeping the low it made in August. Despite this, the Daily chart has yet to close below 18k satoshis. I will be watching the next 48 hours of price-action like a hawk, as STRAT is a large-cap, and thus is not included in my fixed-risk approach. *If* we do close below that August low, I will be exiting my position and waiting on a new range to form before re-entering. Fundamentals are solid for Stratis, so it would pain me to not be holding any.


Ardor:

ARDR/BTC

Price: $0.067 (1301 satoshis)

Market Cap: $66.956mn (12,999 BTC)

Thoughts: Price has broken down from the range, closing below the support turned resistance levels between 1580-1720 satoshis. This break down has been followed by further bleeding, and the September lows are no longer intact. It looks as though we will be closing below 1400 satoshis tonight, unless we catch a ~10% bounce. As with Stratis, I’d be exiting my position on a close at these levels.


Ubiq:

UBQ/BTC

Price: $0.34 (6505 satoshis)

Market Cap: $14.551mn (2,771 BTC)

Thoughts: Ubiq looks to me as though it is forming a spring, which may mean capitulation on high volume in the short-term. It has shown unusually high volume of late, which has also been trending upwards, indicating that there is accumulation underway at recent prices. The October lows have been broken, but I will be looking to buy blood over the next couple of days.


SALT:

SALT/BTC

Price: $0.34 (6519 satoshis)

Market Cap: $27.725mn (5,374 BTC)

Thoughts: Salt is super interesting, as we did see an insane amount of volume recently with a series of higher-highs and higher-lows forming. Market structure was undoubtedly bullish, but we have seen a near-three-week downtrend on very low volume, and a subsequent return to the original accumulation range. September lows remain intact, and this sell-off seems very much panic-driven rather than the exit of those that bought significant positions only a month ago.


Ark:

ARK/BTC

Price: $0.40 (7861 satoshis)

Market Cap: $43.012mn (8,370 BTC)

Thoughts: Ark is unusual in its sell-off, as it is one of few coins that is experiencing a lot of volume on the dump. The August low has just about been swept, and a close here would indicate further capitulation incoming. The drop might get more extreme before Ark finds a new local bottom and forms a new range.


Waves:

WAVES/BTC

Price: $1.45 (28234 satoshis)

Market Cap: $145.418mn (28,234 BTC)

Thoughts: The price-action of Waves is incredibly resilient given that of Bitcoin this past week. Price remains within a bullish orderblock with the August low still a good 10% away. There has been a near-month-long downtrend, with price retracing very slowly and on little-to-no volume. Holding onto Waves seems wise.


BlockNet:

BLOCK/BTC

Price: $2.87 (55815 satoshis)

Market Cap: $15.619mn (3,034 BTC)

Thoughts: BlockNet found its range resistance at a level of prior support, and has been range-bound for almost 3 months. Despite unusually high trading volume today on its dump, September’s low remains unbreached. It would be bullish to see price remain above this low despite such a high-volume dump… monitoring it closely.


Siacoin:

SC/BTC

Price: $0.004 (72 satoshis)

Market Cap: $140.384mn (27,257 BTC)

Thoughts: Siacoin seems to be gunning for that August low despite not quite breaking through it yet. Volume has been steady on the downtrend, picking up a little over the last couple of days. Range support has given way, and I’d be very cautious in buying the blood here. Waiting on true capitulation.


Komodo:

KMD/BTC

Price: $0.78 (15062 satoshis)

Market Cap: $85.86mn (16,676 BTC)

Thoughts: The Komodo chart is a beauty, with near-perfect symmetry between its key levels. Range resistance was briefly breached but proved to be a false breakout, with price retracing all the way back to the range pivot around 18k satoshis. It has since close below this level and dumped down to range support. September’s low remains intact, but it is hanging on by a thread. The next few days should show whether Komodo will hold its local lows or if we’re in for a whole new range.


ALQO:

ALQO/BTC

Price: $0.17 (3349 satoshis)

Market Cap: $9.899mn (1,923 BTC)

Thoughts: ALQO has been in an uptrend for the past 3 straight months, but has recently run into old support turned resistance. It’s a bad time to run into resistance, and some weakness is showing as price failed to make a higher-high. It has since retraced to the trendline support and prior resistance (hopefully) turned support. Closing the Daily below 3000 satoshis would be a clear indication that this current uptrend is over and that we may be moving back towards the lower-2k range. I’d be buying more below 2500 satoshis to add to the masternode/staking portfolio.


FoldingCoin:

FLDC/BTC

Price: $0.002 (36 satoshis)

Market Cap: $1.29mn (251 BTC)

Thoughts: FoldingCoin was looking perfect, with its tight price range and spike in volume, followed by a breakout from the range. Price has since bled back to the range and below, recently closing the daily below range support. For those who don’t use a fixed-risk approach for lowcaps, this would be a good area to cut your losses and wait for a new range to form before re-entering.


Musicoin:

MUSIC/BTC

Price: $0.002 (39 satoshis)

Market Cap: $2.372mn (461 BTC)

Thoughts: Musicoin showed a lot of promise last month in its price-action and its volume spikes, but has since dumped below support around 50 satoshis – a level that is now resistance. Short-term support does seem to have been found at 37 satoshis, with price (just about) closing above the two-week trendline yesterday. A retrace of this recent move and a Daily close below 37 satoshis would make a wise exit-point for those not using fixed-risk, as new lows would be imminent. However, if this not-so-clean breakout can be sustained, with price perhaps forming a new range with 37 satoshis as support, then adding to the position would make sense.

That concludes the 12th Market Outlook. I hope you’ve enjoyed the read and found some value in it. Stay alive, people.


If you’ve enjoyed this post and want to receive new posts straight to your inbox, I’ve set up a RSS-to-Email feed that will be sent out weekly; every Monday, 12pm. Just submit your email and I’ll make sure you’re included in the list. Cheers.