Weekly Recap – 05-29-22
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. These trends still look bad, week after week. H12 and Daily are heavily down across the board for the Top 5 Crypto and most continue heavily for their respective H6 and H4 trends as well. ETH is down 11% from this time last week on the rolling 7-Day and that is in comparison to Bitcoin who only bled out 3%. That’s almost a 4x drop for Ethereum. SOL and ADA also had some serious drops and SOL is now no longer in the Top 5.
Bitcoin Monthly - Long-Term
True Bitcoin Maximalists are busy clutching on to the hopes that we are seeing a yearly cycle on the long-term trend. They broke out their weather apps and have convinced themselves that what we are seeing now is simply what we saw last May. This would mean that we bounce in this area, sweep the low a few times and by the end of July we are on our way to a new ATH. – YES – This is one theory but it is not the only theory. We will touch more on this in the Weekly and Daily.
Bitcoin Weekly - Mid-Term
Never before has Bitcoin closed nine Weekly candles in a row RED. Well, as of a few hours ago – we just did. In fact, I believe that 7 and 8 were records as well. Nine full weeks in a row closing lower on the weekly than the week before. From the High to the Low, we are looking at a 47.47% drop in price. $48,240 down to $25,338. That is some serious damage.
The trend has been down long before March but it is still disturbing to not really see any relief at all. Traders and investors across the board were looking for some kind of relief, especially being that the traditional market actually found relief late last week.
As for now, we continue to hold support from our upward sloping trend, our horizontal support zone and out bottom of the wedge support.
Bitcoin Daily - Short-Term
Bitcoin Daily has been unforgiving in the last few weeks. Yes, we had a good bounce from the LUNA fiasco but since then, all we have done is slowly bleed further and further each week. What makes this especially difficult for analysts is that Bitcoin does remain in its Support Zone. If you ask me, it would be better to rip the Band-Aid off, drop it as low as it needs to go and then spend the rest of the year working the levels up. Unfortunately, what we want and what the reality is are two very different things.
There are some develops here that are worth looking at. A Falling Wedge is known to breakout, channels that fail on support are generally retested on the underside, nine weeks in the red is unheard of and we do actually see some short term indicators turning Bullish again – THAT BEING SAID, everything is a mess as far as price action is concerned and no matter what the move is, it will need to be confirmed.
Daily Bitcoin Volume
The average volume is starting to plateau a bit and there is very little to be surprised about being that we had a yearly record setter a few weeks back. The market is settling out from the panic and hysteria that it reached from the LUNA Black Swan. This means the volume will settle down as the panic gets more and more under control and traders and investors can approach the market with cooler heads.
The Bitcoin Dominance has really been on the move lately. All the levels are playing out as expected, so, in that regard, it’s great. 44.75% has been converted into Support and 46.75% remains the next focal point as far as resistance is concerned. This is a double-edged sword as we can see Bitcoin Dominance rise but we see the entire market bleeding. This means that the higher risk alts are dumping and therefore passively attributing to the increase of Bitcoin Dominance.
Bitcoin CME Futures
Futures Market saw some wild price action last week. There were times when Futures was offset from the global market by $500. We are working with the latest gap at the moment, which is from the Open today compared to the Close on Friday.
In the bottom picture we can see the Day by Day breakdown of gaps getting filled from Monday (filling the weekend gap) all the way to Friday (filling the gap leftover from the close on Thursday). The thing to notice here is that even during the week where Bitcoin Futures trades 24/5 – we still would up with a gap everyday and at times, they were pretty significant. Be that as it may, all Gaps have been filled from last week.
This Market is NOT for the weak. You need to keep a cool head while trading this action, especially when prices are going down. Every little mini 1% pump feels like a new Bull Market but each of those candles are swiftly met with a 3% drop. There are a few patterns emerging from this mess since the big drop.
We can see a Descending Triangle, a sloppy Falling Wedge, a much larger Falling Wedge and an upward sloping trendline. All o these things are nothing more than price action forming patterns that may or may not play out. The sloppier the pattern, met with a lower amount of average volume and you can almost certainly expect these patterns to NOT play out. Nonetheless, it is still something to keep in mind as some traders will absolutely play these levels – especially Breakout Levels.
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