For a change, I’m going to do an overall crypto market analysis on the chart, since I know a bunch of people were appreciating my updates on this pairing.
This market has gotten me pretty exhausted, which is why I haven’t posted too many new charts recently. I’m trying to focus on other things at the moment. However, there are some really interesting things going on that I would like to point out. First of all, I speculated back in November that the EARLIEST we’d see the bull market return would be late January/early February. We are now entering late January. I also said this was when was likely to break out. This is because I believe the last bull cycle matches up best with bitcoin [BTC]’s 2011 bubble (in terms of severity for many altcoins). For those that don’t remember, crashed from $30 to $2 (a 93.3% decline). The time it took to recover is equivalent to the time between the peak of the 2017 bull market and around now. History doesn’t have to repeat itself, but often certain lengths of time do play into our psychology. Right now though, the market looks very mixed, if somewhat . Reversals can happen extremely quickly, but in particular isn’t showing any real positive signs. This means that I may have been wrong, and that the market is actually in the process of dying. Here are some observations (both positive and negative):
Positive observations:
1) Many alts have held support, and have even shown signs of accumulation, well above their November-December bottoms. Some are even beginning new cycles ( , WAVES, STRAT, GVT, possibly , etc.).
2) has broken out from a major downtrend resistance line on the Coinbase chart and has been testing it as support the last few days.
3) bitcoin [BTC]’s weekly is looking very bottomy.
4) has made its first higher high since being trapped in a long consolidation period dating back to October. I use as a market sentiment indicator, because to me it signifies advancement in this space, and the people who are into cryptocurrencies see it as a major potential alternative to . Not that it will necessarily challenge bitcoin [BTC]’s market cap eventually, but speculators see it this way, which is why it has remained . It already had a clear capitulation bottom in August and recently retested its $0.75 low without breaking down in value.
Negative observations:
1) has failed at its Bitfinex resistance line over and over again. This line is extremely steep, and it has many touches on the daily, and even weekly charts. It connects the , the Tether pump, the November Dump, and our most recent big green candle that got rejected.
2) Alts are pumping, yes, but that’s because there is a very small amount of money in this market. Only a small amount of capital is required to push up low cap coins (like GVT, for example). If you notice, the only top 10 alt to have a sustained run since November is . Everything else looks weak, particularly . Big investors have left and have seemingly no intention of buying at these prices.
3) The on the alts that have pumped is way overheated, which indicates that it has taken too much buying pressure to support those prices, which means they aren’t sustainable. This is just my impression though. It might not be an accurate interpretation of the data.
4) We’ve been seeing a lot of “fake” moves. Price will blast above resistance, only to come crashing down. Or price will break down below support, only to rally back up. This is characteristic of a market that has no direction. There have been a lot of stop hunts as well. I don’t really think that indicates anything positive though, because I think the people are accumulating are doing so in order to control and destroy the market.
These negative observations lead me to believe that the market is actually CONTINUING to weaken. This means that I wouldn’t be surprised if actually retraced this entire pump and slid back down to support or new lows. If we do happen to decouple and move up, the targets are in red on my chart. As you can see with this analysis, things are very mixed. When things are mixed in a bear market, it usually means a selloff is upon us. I’m fully expecting new lows for the market at this point. Best case scenario, I think we see a capitulation wick sometime over the next few weeks. Perhaps I’m wrong (I was wrong about holding 6K but I was right about holding $0.75….go figure). Another possibility is that simply dies out, while some strong altcoins take its place. This would explain the momentum with but the beginnings of a bull market for alts. The top contenders I saw for this were XRP and . They have both remained suspiciously stagnant (and low) for a while. A big surprise would be to see them shoot up in value out of nowhere.
It is also possible that my negative view is just the emotional symptoms of the bear market. Maybe since I’m feeling so , we really have bottomed. Overall, I think in my analyses, I’ve been more accurate than inaccurate, but I’ve made some bad calls that I’m not proud of as well. It’s all part of my learning process, but I’m on the verge of really giving up now. I’ll have to anyway, since my life is moving on.
This is not a trade setup or a recommendation to buy or sell. Here’s my previous analysis for reference:
-Victor Cobra
Published at Thu, 24 Jan 2019 01:46:38 +0000