Weekly Recap – 08-14-22

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.  Bitcoin, Ethereum, and Cardano show strong trends in their respective H4 Charts. Ethereum and Cardano also show strong trends in their respective H6 Chart. ETH is leading the pack for its 7-day gains at 15.5%, followed by ADA at 8.5% and BTC at 5.6%. Even more interesting is the rolling 30-day Gain/Loss for the Top 5:
BTC = 18%
ETH = 61%
BNB = 34%
XRP = 12%
ADA = 30%

Ethereum has been leading the charge for the last month regarding the Majors.

Bitcoin Monthly - Long-Term

Unfortunately, Weekly updates on a long-term Monthly trend are going to be somewhat repetitive in nature as only seven days have passed and we are looking at years’ worth of data. That being said, August is currently Green for the month and we are halfway through. August has also challenged the July High and is currently trading above that high as we speak. These little details help to tell the momentum story and what is needed in order to make an actual reversal.

Bitcoin Weekly - Mid-Term

The Weekly candle closed with an $1100 (~5%) gain from the Open last Sunday night. This was actually a very important Weekly close as we were able to close above $23,300 which was a trouble area for several weeks. As we mentioned in a previous article, Bitcoin has had very little resistance for a while and it appears to be taking full advantage of that, day after day. The Weekly move to approach the downward sloping trendline from the ATH of $69K is around $27K. Just to get through the zone we are adding another $1K. If we see a Weekly close above $28K then a lot of alarms are going to go off for traders all around the world as that would be the break of the ATH downward sloping trend.

Bitcoin Daily - Short-Term

The upward sloping Rising Wedge is so far invalidated that it is merely just a reference at this point. We can’t take any solid measured moves from it because it has not respected the upper bounds of resistance. That being said, it becomes more and more bullish, the more it becomes invalidated. So long as the Bulls are ripping through resistance and not getting trapped by the hurdles in their way, then momentum picks up and more traders begin to see the trend. The million-dollar question is what happens if/when we finally reach the trendline? In order to validate the trend, you need three touches, so, the third touch is generally rejection. We need to wait and see what happens between now and then but as of now, for the Daily, things are trending up.

Daily Bitcoin Volume

We have found average volume support at a very similar location to the volume average highs back in January. If we can continue to maintain this type of trading volume without trending downward then we have a real chance to see bigger players coming back into the market and sustaining current market moves.

Bitcoin Dominance

Bitcoin Dominance is staring 40% in the eye and the Bears are calling their shot like the Babe back on the diamond. This has been a fairly slow and steady drop and we have yet to actually reach the pivotal 40% Dominance zone but it looks like it’s coming any day now. If we continue to see Altcoins get a few breaks here and there and Bitcoin remains sideways or slowly advancing then 40% is all but guaranteed.

Bitcoin CME Futures

The World-Famous Bitcoin CME Futures chart remains exciting week after week! In the last week, we finished off another 3 mini gaps created throughout last week and the week before. We still have a very small gap sitting at the recent low, but with the trend creating higher highs, we look to actually challenge the high-side gap created back in mid-June when Bitcoin took a nasty fall from $30K. We would need to see Bitcoin at $28,920 in order to completely fill the upper gap. There are plenty more gaps if we zoom out, not only above but also below.

Conclusion

The major trouble area was created during the pause or hesitation in the initial dump. That Support came in at $22,460 and the high-side initial rejection was put in at $23,299. This left a massive trouble area for both Buyers and Sellers and it makes a lot of sense that we danced around this zone for a while. Once we broke the area and put in a new local high at $24,287, we created the double-break zone. This area of focus is specifically watching price action as it interacts with this area. Rejection is expected at first which is exactly what we got. The next time we approached the area we had 5-days of Rejection once again. However, now we are over that level with three candles to confirm. The candle so far today is approaching the highest high of this local strand and that high was put in yesterday. There is a chance we see explosive action to the high side over the next few days and propelling the Crypto Market for the next week.

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