The last time we did a longer term technical analysis was back in November. If you recall, we surmised that Bitcoin would drop and test lower levels (at the time $53.3K), and make another run for higher levels ($59.8K). Check out the red arrows in the daily chart. That's pretty much what happened, as Bitcoin tested our level exactly, before rejecting it, and plunging into the $40K's, which we also predicted. It's time to take a look at the charts and the crypto market for an update as to where we're at.
We have been stressing lately that several risk factors are prevailing in the crypto market. These include lack of liquidity, low volume, hesitancy in market participants, and historical malaise this time of year. So far, in 2022, these issues seem to still be afflicting the crypto market. We are still bullish on Bitcoin long term, but feel that if we can't break this range between $45K-$50K, then we may see lower levels. Not to mention that tax season is quickly approaching and we usually see outflows around this time as well.
It is insightful to take a look at some of the longer term levels, on the daily charts. We have Fibonacci levels anchored at the extrema of the most recent bull zig zag that began in July. Observe that the current price is fluctuating right about the 50% level, at $48.6K or so. Also note, we have tested (just above) the 0.382 level, a few times, and are finding support for now. But if the markets can't muster the momentum to push higher, they're likely going to test buying interest at lower levels. This range won't hold forever.
If we break the 0.382 level at $44.0K, then the next level down is $38.2K. If $44K can't hold, then the $30K's are a strong possiblity. After that, we have July's relative low at $29.0K. After that, then next level is another Fibonacci level anchored on 2020's prices at $19.1K. This level roughly coincides with all time highs from 2017. The latter is the most extreme case, but it is insightful to have some levels in mind on where to buy should we face another crypto melt down.
If momentum does come through, we must first break $50K definitively. This level has proven to be a hard upper bound and we've rejected it several times. But if we can solidify the $50K's then $53.3K is the next target. There is a bit of a vacuum zone after that $59.8K, which is the final barrier to the $60K's. These are some steep levels bound to provide formidable resistance on the way to all time highs again.
In conclusion, we are still bullish (very long term) of crypto, but anticipate a bumpy road for the beginning of 2022. Full disclosure: we are mostly cash (stable coins) at this point and waiting for BTC to test the levels mentioned before we take a position. Worst case, the market rallies without us, and we buy on dips on the way up to highs.
We have been stressing lately that several risk factors are prevailing in the crypto market. These include lack of liquidity, low volume, hesitancy in market participants, and historical malaise this time of year. So far, in 2022, these issues seem to still be afflicting the crypto market. We are still bullish on Bitcoin long term, but feel that if we can't break this range between $45K-$50K, then we may see lower levels. Not to mention that tax season is quickly approaching and we usually see outflows around this time as well.
It is insightful to take a look at some of the longer term levels, on the daily charts. We have Fibonacci levels anchored at the extrema of the most recent bull zig zag that began in July. Observe that the current price is fluctuating right about the 50% level, at $48.6K or so. Also note, we have tested (just above) the 0.382 level, a few times, and are finding support for now. But if the markets can't muster the momentum to push higher, they're likely going to test buying interest at lower levels. This range won't hold forever.
If we break the 0.382 level at $44.0K, then the next level down is $38.2K. If $44K can't hold, then the $30K's are a strong possiblity. After that, we have July's relative low at $29.0K. After that, then next level is another Fibonacci level anchored on 2020's prices at $19.1K. This level roughly coincides with all time highs from 2017. The latter is the most extreme case, but it is insightful to have some levels in mind on where to buy should we face another crypto melt down.
If momentum does come through, we must first break $50K definitively. This level has proven to be a hard upper bound and we've rejected it several times. But if we can solidify the $50K's then $53.3K is the next target. There is a bit of a vacuum zone after that $59.8K, which is the final barrier to the $60K's. These are some steep levels bound to provide formidable resistance on the way to all time highs again.
In conclusion, we are still bullish (very long term) of crypto, but anticipate a bumpy road for the beginning of 2022. Full disclosure: we are mostly cash (stable coins) at this point and waiting for BTC to test the levels mentioned before we take a position. Worst case, the market rallies without us, and we buy on dips on the way up to highs.
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