Technical Analysis
Good Morning!
First off, kudos to my former boss Simon Tobler who was spot on with his ABC correction call last week. My view was skewed to the bullish camp, which obviously did not play out.
But let's begin by taking a look at the two heavyweights and then check up on some altcoins. Some of them are holding up pretty well in comparison to the overall performance of the market.
Bitcoin BTC (daily)
It looks like the ABC correction scenario is in full force. The hard part is to figure out where "C" will print (the low). If we use the Fibonacci Extension, we see a wide range between $35-42.5k.
To get some more insight (through wave structure), I will zoom in (4h) to see what local top needs to be taken out. It looks like it is $50k...
So, for me, there is no clear direction or short-term trend change. I will continue playing the $44k-50k range. The long term play (which we are already in the midst of) is to build up long exposure in a three-leg strategy (we bought some yesterday). If the "C" plays out in the lower region of $35k, we will add to that long strategy in another two legs at around $40k and $35k.
Bitcoin BTC (4h)
Ethereum ETH (daily)
From a Fibonacci point of view, we almost corrected 61.8% (just shy above the baseline: see the blue line). So far, however, there has been no real indication as to which way the price will go over the course of this week.
Zooming into the 4h chart, all the bodies of the lower price candles managed to close within the Ichimoku cloud. We need to hold this level otherwise another leg of correction will happen. On the topside, I want to see prices push through the baseline and the cloud, which would give me a clear sign of a continuing bullish trend.
Ethereum ETH (4h)
Aave AAVE (4h)
We can see a great deal of strength in the AAVE chart. The big correction in the general market did not scare the AAVE holders. We are almost back to the highs, and it looks like we will print new ones this week.
Fundamentals are signaling strength as well. The protocol is earning a lot of money with no hacks so far, and further integration into many other DeFi protocols are either done or in the making. The biggest fundamental development to me is the AAVE pro market (permissioned pools), which are in the "testing phase". If AAVE and the regulated VASPs can overcome some of the compliance hurdles that are caused by regulators, it will unlock a gigantic amount of capital, which will then be able to flow into DeFi.
ThorChain RUNE (daily)
Multi-chain and low fee protocols are getting another shot at all-time highs. The universe of coins, which represent these attributes, is pretty wide, so pick wisely. ThorChain (RUNE) has repeatedly produced new updates and delivered their roadmap bullet points on time with no glitches or hacks so far. The chart reflects this with almost no deeper corrections - even when the general market is suffering.
Solana SOL (daily)
This chart looks very similar to RUNE and it is no surprise to me as it sort of fulfills the same attributes and has delivered similarly.
There are many more altcoin projects worth charting, but I need to keep our TA-Tuesdays short and snappy.
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