Weekly Recap – 12-26-21

Price Action

Weekly Winners - Peak Gain

Weekly Losers - Peak Drop

Merry belated Christmas to all of you out there reading this.  That is correct, this recap includes Christmas Weekend.  For those that are pretty handy with a calendar, I’m sure you noticed this is THE LAST RECAP OF 2021!  Next weeks recap will be on January 2nd, 2022.

The overall week turned out to be a potential recovery week but it started out pretty bad.  All things considered, Alts continued to bleed while Bitcoin continued to stress test the low side of a local range.  Tuesday got the party started and all it took was a candle that wasn’t red…

Some Alts caught on quick while others still remain a bit lackluster.  AVAX for example, already tested it’s local 618 from it’s ATH.  Resistance has been found at the moment and AVAX struggles to get over the hump.

We can see from the Losers list, all new coins got slaughtered as they entered the market recently.  This week hit them hard as well.  

We also saw some lower cap coins get a lot of love this past week.  Everyone of the Peak Movers to the upside has a fairly low MCAP.

Correlation Matrix

Some Alts are becoming less and less correlated with each other.  The growing separation tells a tale of how all over the place the market is at the moment.  

The highest correlation is once again BTC and ETH, sitting at a correlation ratio of 0.84.  BNB who has between making a comeback as of late is also sitting at a correlation of 0.84 with ETH.  

Crypto FEAR and GREED

The needle is ever so slightly working its way back to a safe ground.  Last week we were in Extreme Fear.  This is the point where the scared money starts selling and the smart money starts buying.  

That is evident as the needle has worked it’s way from Extreme Fear to just plain old Fear.  If the trend continues then by this time next week we should be seeing the needle past center and into the Greed area.

Daily Bitcoin Volume

With Christmas being at the end of the week, there was very little surprise that the volume was a bit on the low side.  Don’t expect too much for this week coming up either as we have New Years in America and we have the final trading week of the Year.

If we see a lot of movement then it will likely be positions closed only to re-open in an effort to help traders with taxes.

Bitcoin Dominance

40 continues to hold.  We are essentially on our 4th major test of the 40% Zone for Bitcoin Dominance.  Our Resistance has sharpened a bit and that is bad news for Dominance.  There is even greater pressure now on the 40% level as the resistance comes creeping closer and closer to converge with Support.  Could this result into a huge pop for Dominance or will it crush Dominance down and give one huge run to the Alts?  Time will indeed tell.

Bitcoin CME Futures

We still have a considerable gap at $53,545.  Despite the numerous daily gaps over the last few weeks, everyone has filled except for the big one up top.  Unfortunately, even if it does fill soon, we still have quite a bit of Resistance right above it.  As we always say, Bitcoin has been known to fill these CME Gaps, so don’t be surprised if this is the week we see $53,545.

Bitcoin Monthly Red/Green

There is still quite a long way to go to turn December Green but certainly not impossible.  We have seen Bitcoin do crazier things.  Bitcoin would need a push into the 57’s and all the biggest candles since early November have more or less been selloff candles as opposed to pump candles.  

Bitcoin Weekly S/R

There is a rather interesting area coming up that has 4 different areas of resistance all converging around the same place at about the same time in the future.  January 10th to January 24th is when all of these areas seem to meet.  

We have one internal trendline, one currently broken trend that was previously support that could fail on another retest, we also have Weekly S/R from the 65K previous ATH and most significantly, we have the local 618 Fibonacci from the current ATH to the recent Low.  

The good news is that there is no major resistance between here and there which could open the door up to $58,800 – the bad news is that it will be extremely difficult to get through that cluster of resistance.  Of course, all that talk is useless unless we can trade over $52,000 first!

Conclusion

As we mentioned above, Bitcoin needs to prove itself over $52K before we start talking to seriously about $58,800.  Ever since we lose $52K on December 4th, we have traded below it.  Only twice in almost a month has Bitcoin even approached $52K and each time it was swiftly batted away.  

Step one for the Bulls is flipping $52,000 back to Support.  Step one for the Bears is to make sure the Bulls don’t succeed.  The Bears have been winning for nearly 2 months straight.  

There is some suggestion that the Bulls may be able to break through this area.  Other technical indicators are pointing in a healthier direction and they are starting to show signs that the Bears are getting exhausted defending this area.  This could be the week we break out of $52,000 and start the march to $58,000.

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