Weekly Recap – 02-27-22

Top 5 by MCAP

–Although this recap is mostly all about Bitcoin, it’s still important to discuss the overall health of the Top 5 as numbers 2-5 do have sway in the altcoin world. 

LUNA has knocked ADA out of the Top 5 Crypto by MCAP.  There are some other sources of MCAP that don’t always register through conventional methods and that was enough to put LUNA over ADA and SOL by only a few million dollars.  This can also change by the minute depending on price action.  

Everything except for LUNA looks terrible in not only the longer term trends but the shorter term trends as well.

Bitcoin Monthly - Long-Term

Long-Term trend is still hanging on by a thread.  Bitcoin can be so dramatic sometimes!  The recent low of $34,322 was still higher than the also recent low of $32,933.  This is a change from what we’ve seen recently and some may consider it a potential reversal.  Regardless, Bitcoin just needs to stay above $28,800 to maintain its Long-Term uptrend.

Bitcoin Weekly - Mid-Term

Weekly Support is still holding up even after last weeks attempt to smash $32K again.  The weekly low was also higher than the previous weekly wick four weeks ago.  This is not to say the downtrend is over but it is a reason to pause for a second and look at the price action.  Of course, Bitcoin would need to overcome some serious resistance in order to break the recent high at $45,855 in order to set the stage for an actual trend to begin reversing the downward spiral we have been in since November.

Bitcoin Daily - Short-Term

On the more local Daily Chart we can see some sideways action in the $27 – $39K area.  This accounts for a majority of the trading in the last seven days.  Support is currently holding and resistance was actually giving way until the weekend.  

There are some external factors to take in last week as well that did have an effect on the entire market – all over the world.  War is not to be taken lightly and given the players involved, there are a lot of uncertainties.  Investors from every market in the world look to de-risk at times like these so it’s actually very Bullish for Bitcoin to remain as sideways as it has as opposed to completely crashing.

Daily Bitcoin Volume

We actually saw a decent amount of Volume last week.  This would be a very big sign for Bulls to come out if the market can prove their suspicions right… Volume coming in, the buying is getting heavy again… It’s time to move upward.  The 30-Day average was saved from the free-fall that it was headed into when beginning the week.

Bitcoin Dominance

Dominance is taking a backseat at the moment.  All we have here is some sideways choppy action that is well above Support and well below Resistance.  A little sideways action is not too concerning so long as price is also staying relatively sideways.  The Support at 42 and the Resistance at 45 will remain the theme until proven otherwise.

Bitcoin CME Futures

By far, the most interesting piece of data to look at over the week was the Bitcoin CME Futures chart and the many Gaps the Daily chart has left behind.  Gaps down to $34,400 were filled with ease and new gaps were also created and filled within a day of trading.  The markets have been volatile and that helps with these big wicks and wild price action.  A piece of the $40K Gap was also filled but not enough to wipe it off the map.  Now we are currently filling the weekend gap as the market was closed from Friday night to Sunday night.

Conclusion

The first thing to look for in a reversal of a downtrend is the slowing down of the sell pressure.  A loss of momentum can help to switch motion from down to up.  The second thing to look for is a change to the norm.  What that means is, during the downtrend you are always making Lower Lows and Lower Highs.  The second that changes , you have something to bit onto until it fails.

On the Daily we are seeing the drop in the 32s to the rise in the 45’s to another drop in the 34’s.  What this gives us is a Low, a High and a Higher Low.  If Bitcoin can manage a High that is Higher than the previous Local High then we can say that Bitcoin has locally started to change the direction of the Daily trend.  This can also fail at anytime because we are technically still in a Downtrend.

So, we wait.  Can Bitcoin manage a run above $46K?  If it does will it be able to sustain a pullback that remains above $34K?  And if that is the case, well, then we may very well be reversing the Downtrend from November.

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