Technical Analysis January 26, 2021

An overview of the trading activities on the cryptomarkets. Studies on traded volumes, supply and demand situations, as well as periodic technical analysis of the most important crypto-currencies and indices, including the perspective of professional Traders.

Technical Analysis

Good Morning!

BTC$ (4h)

We are still consolidating, but things look slightly different now...

The symmetrical triangle did not hold. When we dipped down to the $29k area, the structure broke. Additionally, the price pushed through the Ichimoku cloud and stayed below it for several days. In fact, we are still below it, and the cloud has started to act as a resistance.

This is causing me to lean towards neutral or even slightly bearish. In combination with a potential descending triangle, I am watching the $29-30k zone very closely.

In contrast, the derivatives market structure has relaxed quite a bit. The term future basis tightened across the curve:

Mar-Basis from $1,700 to $730
Jun-Basis from $3,000 to $1,500
Sep-Basis from $4,050 to $2,400
Dec-Basis from $5,950 to $3,200

However, it is important to note that the relaxation of the basis is also a function of how "bullish" or "bearish" the market is. Hence, a basis that comes in can also indicate that market participants are losing their bullishness.

In terms of the onchain data analysis, we see no real changes in the direction of the coin flow. Over the past 12 months, we see a continuous outflow of coins from exchanges. If you drill into the individual exchange data, the flow pattern shows that coins are flowing to derivative exchanges and leaving the spot exchanges (mainly the ones with proper fiat on/off ramps). This does makes sense in combination with the crazy liquidation data we are seeing on those so-called "APE" trading platforms, where you can trade with x125 leverage.

For me, the bottom line is that we are still in a consolidation phase, with a potential risk of a sharper correction to the downside. I need to see a clear break of the $36k level to feel comfortable attacking the ATH again.

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