Cryptocurrency market to continue down

2021년 6월 25일

CAPITALCOM:CIX combines different cryptocurrency assets into an index as does the for some US equities. I have been with a bearish outlook for BTC and therefore all other cryptocurrencies/ tokens who follow BTC with a correlation higher than +0.75 ( dynamic correlation used based on past performance of selected assets in the past 3 months, new datapoint generated each 4h ).
Using different TA methods on the weekly charts, on different charts ( BLX , BTCUSD , TOTAL and more it seems that we should continue with lower prices at least until mid Q3 / mid Q4 2021.

In previous publications I noted that there was a strong bearish pattern on the weekly chart prior to the initial drop. It was a combination of H&S pattern and Double top patterns (formed within the head of the H&S). Generally such combinations provide extremely good opportunities as they change the sentiment shift and create fast and sustained moves to the direction of the new bias. Although majority of "crypto youtube", "crypto twitter" and so on is still holding a positive bias towards the short to mid term for the asset class, mainly with the belief that this cycle has good correlation to the prior cycle of 2013 and 2017, I couldn't find the same drivers behind the "cooloff stages" of the respectful bull markets in prior cycles. In 2020 to 2021 the bullmarket was mainly driven by increased amount of new specualtors/ investors comming either due to the QE done by the FED ( mostly retail ) or due to expectation of weakening dollar combined with speculation for cryptocurrency price appreciation ( smart money ) - at least this is what I have seen so far. Institutions have been purchasing and holding BTC, but not only, as a way to improve their balance sheets.

• TSLA
• MSTR
• Revolut
  and more;
  

I won't speculate on wheter or not any of those companies would postpone, continue or stop alltogether their practices with cryptocurrency assets, and also I don't really think it is important. Those news have been priced in for quite a while now, even the recent "negative" comments on Twitter by Elon Musk in regards to Bitcoin's environmental issues. A new theme I'd see playing out however is a combination of unrealistic price levels reached too fast too soon on all major cryptocurrencies, and blockchain related mainstream products ( mainly NFTs ) and strengthening DXY looking forward.
In the event that the whole market sees a drop, that would be a great trigger for positioning in the market for at least another leg down on most cryptocurrencies.

Based on those factors, weekly market structure, and a bit of speculation in regards of a potential market drop on all asset classses, those are the levels I am most inclined to become a bull on cryptocurrencies once more :

* BTCUSD - 24.5K ( aggressive buy entry ) | 18.5K ( entry with the most confluence around it ) | 13.5K ( in case of "full" market capitulation )
* ETHUSD - 1.5K ( aggressive buy entry ) | 1K ( entry with the most confluence around it ) | $670 ( in case of "full" market capitulation )
* ADAUSD - $0.65 ( aggressive buy entry ) | $0.50 ( entry with the most confluence around it ) | $0.3975 ( in case of "full" market capitulation )

Those are some of the levels I'm looking forward as potential levels of the next strong sentiment shift occuring, which means that if this analysis holds value we should be expecting those prices somewhere in late August - October 2021. If this plays out indeed, the recovery could either be strong and fast - fueled by some strong sentiment shift ( eg. significant improvement on DEFI platforms, services and UX / new way to improve mining signifiantly / additional country - more influential on the global scene - would be perfect if its part of the G20 accepts their legal currency as BTC )

PS. all this is just my opinion, based on different factors combining macro themes, TA, and ofcourse, speculation. DYOR