This edition of the Crypto Comms newsletter is all about price-action and relevant levels of interest. The mean reversion rally is in tact, resilient and aiming higher. We’re cheering for a mega pump, but being nimble as new information comes in is the name of the game.
Let’s dig in.
In this issue:
- Bitcoin analysis
- Ethereum analysis
- Litecoin analysis
- Latest happenings
- Listening material
After a ‘Darth Maul’ weekly candle, Bitcoin/Dollar is down -2.5% week on week. Prices reached $24,770 before retreating and closing off the month of July at $23,340.
The level of interest for ‘mean reversion profit taking’ is upwards of $32,000, considering the price range for the month of June (breakdown month). Liquidity resides above the $30,000 level, which if reached may result in an over-extension to fill the CME gap at around $35,000.
BTC/USD reached the mid-point of the range in consideration.
On the daily time-frame, price is characterised by a series of higher highs and higher lows. In fact, price is in the early stages of a trending mean reversion rally within a larger ‘technically bearish’ context. As you know, I believe this larger time-frame bearish ‘technical’ will give way to bullish fundamentals this year, and that price will hit all time highs in 2022, but I digress.
A push above $24,700 opens the door for price to traverse to the opposite end of the range, marked out at $32,000.
Per the volume profile, there’s not much going on between $24,000 and $28,000. As such, one should expect the next retest to be characterised by price acceleration.
Intra-day, price is bullish provided $22,200 holds as support. A reclaim of $23,500 opens the door to fresh highs. The line in the sand for convincing local continuation arguments is $21,700.
Ethereum/Dollar is a similar trade to Bitcoin/Dollar. The only reason one would consider ETH/USD over Bitcoin is if there’s a convincing rationale for ETH/BTC to traverse higher. Presently, there is, but it remains to be seen if there will be follow-through to the range high at around 0.083 Sats.
ETH/USD is down -6% week-on-week. If the ‘levered Bitcoin trade’ rationale continues to work, then exacerbated moves to either side may be ‘sticky’ into the future. In terms of futures trading dominance, ETH/USD has taken the lead over Bitcoin. This is a double edged sword.
Local price-action remains bullishly-biased provided $1,530 — $1,510 hold as support. Price should not spend much time near $1,420 for bullish arguments to make sense in my estimation. The series of steep higher highs and higher lows needs to be maintained in order to justify an accelerating uptrend. Otherwise, the time-horizon for bullish continuation gets stretched out depending on the next zone of buying interest. This is true for both majors.
An initial low time-frame indication that ETH/USD would eclipse its June high ($1,975) would be a reclaim of the the Monday open ($1,627). Conservative bidders may prefer to wait for confirmation above $1,700 before jumping in.
On the flipside, losing $1,420 is a ‘risk off’ signal for ETH/USD, at which point $sub $1,000 becomes a potential target again.
Litecoin/Dollar is down -4% week-on-week. Reclaiming $59 opens the door to new local highs above last week’s high ($64). Litecoin is one of the most volatile high market-cap coins around — when this asset witnesses expansion, it’s best not to fade it. The coin has also traded at generational lows versus Bitcoin, substantially tilting the risk-reward profile in favour of wild upside targets in my estimation (unless you think it’s going to zero).
The same market structure rationale applies here. LTC/USD is in a developing local uptrend. As such, continuation of this series of higher highs and higher lows lends credence to the idea that said uptrend will continue. If prices trend above $70, the probability for a ‘squeeze’ higher through lightly traded levels increases.
Crypto is in the midst of a robust mean reversion until proven otherwise. Prices are trending higher. However, expecting the first successful mean reversion to give way to all-time-highs would be naïve. The market will trend high enough to convince most people it will never go back down (only to reverse after). The same is true when prices trend lower. One side is lopsided due to the nature of money in the last 100 years.
It is what it is, and it’s why Bitcoin is the endgame.
- New Bitcoin Whale Owns $3 Billion Worth of Bitcoin.
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- Millionaire Moves 14,000 BTC to an Unknown Wallet Amidst Market Uncertainty.
The purpose of this newsletter analysis is to provide context to current events and cryptocurrency markets. It is released every Monday and Wednesday. I am not perfect and this is not a science — nor is this newsletter a signals service or financial advice. While I cannot promise perfection I do my best to be honest and transparent.
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