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Market Outlook #38 (3rd June 2019)
Hello, and welcome to the 38th Market Outlook, albeit a day late.
In today’s post, I’ll be covering Bitcoin, Ethereum and Monero, as usual, as well as providing updates on Tron and Cardano.
Let’s crack on:
Bitcoin:
Daily:
4H:
Price: $8550
Market Cap: $151.815bn
Thoughts: In last week’s Market Outlook, I mentioned that I expect price to clear the ‘double top’ at ~$8400, given that such clean resistance often provides fuel for further upwards momentum.
This past week, price did exactly that, climbing above short-term resistance to new highs of $9100, where it topped out and rejected hard, dumping back below $8000 briefly. However, as can be seen on the Daily chart, price refused to close below this level, instead respecting it as a new area of prior resistance turned support. Now, we can also see that the parabolic advance is still just about in play, and until we get a clean break below trendline support on significant volume, I anticipate new highs later this week.
That being said, it is quite clear that such an advance cannot be sustained indefinitely, and it does appear that Bitcoin is losing steam on this particular rally, indicated by higher prices but declining RSI and volume. If we do break below that trendline support, I expect $8000 will be retested, and a close below that level would turn market structure bearish on the Daily timeframe. This would likely lead to a move back towards ~$7500.
Now, looking at the 4H chart, we can see that the move up to $9100, followed by the move to ~$8k, broke market structure on this timeframe. However, price recovered well, climbing back above $8500 and forming a lower high around $8800. I’m watching for a clean break of this lower high to indicate new highs on the way, or a break below $8300 to confirm a retest of $8000 support.
Bullish until proven otherwise, in short.
Ethereum:
ETH/USD
4H:
ETH/BTC
Daily:
1H:
Price: $264.97 (0.0309 BTC)
Market Cap: $28.175bn (3,300,678 BTC)
Thoughts: Ethereum did precisely what was expected of it last week, culminating in a huge market-wide shakeout before last weekend. Looking first at ETH/USD, however, we can see that price broke out of its bullish pennant on decent volume, finding new highs at $289, before it rejected and found support at $235; a huge move that concluded with the 4H closing above $250 and recovering prior resistance turned support at $260.
Now, looking at the Daily chart for ETH/BTC, we can see exactly where the volatility came in last week, sending prices down into the Daily Breaker, just below 0.03 BTC; a level I mentioned must hold for price-action to remain bullish. This level held firm, and price looks to be forming an extended swing-low preceding the next leg up. The 1H depicts trendline resistance that is currently holding price down, but I expect we shall see ETH/BTC make a move above 0.032 BTC over the coming days, turning short-term market structure bullish and beginning a new leg up.
Monero:
XMR/BTC
Price: $93.96 (0.01102 BTC)
Market Cap: $1.599bn (187,412 BTC)
Thoughts: Monero remains in consolidation, having broken above trendline resistance and formed a higher low at 0.0105 BTC upon retesting this resistance as support. As mentioned last week, we are watching for a Daily close above 0.012 BTC on significant volume as a signal for the cyclical bottom being in.
Tron:
TRX/BTC
Daily:
4H:
Price: $0.037 (435 satoshis)
Market Cap: $2.47bn (289,825 BTC)
Thoughts: Tron continues to look bullish and my margin long positions are paying off. From the Daily chart, we can see that price broke out above 4-month trendline resistance last week, with volume continuing to rise. However, price rejected at the 360-day moving average, but remains firmly above prior resistance turned support at 400 satoshis. In fact, Tron seems to have begun its own parabolic advance on the Daily timeframe, with the rally becoming steeper over the past few days.
Looking at the 4H, we can clearly see levels of resistance becoming support on the ascent, and I have marked out 500 satoshis as my target for this next leg.
Cardano:
ADA/BTC
Daily:
Price: $0.093 (1094 satoshis)
Market Cap: $2.418bn (283,616 BTC)
Thoughts: Finally, we come to Cardano, and there is a beautifully clean pattern playing out for those who enjoy trading patterns. We can see that ADA broke above trendline resistance a couple of weeks ago on good volume, and retraced to form a higher low. This rounded, protracted higher low is forming the Eve to early May’s Adam, with 1220 satoshis as the neckline for a breakout. There is also confluence of the 200-day moving average at this level, and, as such, a breakout above this level will likely be followed by dynamic expansion towards the 360-day moving average.
And that concludes this week’s Market Outlook. I hope you’ve found some value in the read.
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