The market is real bearish. You don’t really need me to tell you that. Daily and weekly structure is a hair away from failing. The daily targets of bearish divergence have all been hit. The first weekly targets of bearish divergence sit at about $25k.
Here’s a refresher post I made back in Dec about these targets and the weakness present at higher timeframes in the market.
ETH has a bit more of a base of support but that’s not really a lot of consolation. I’ll show why next.
Looking at the ETH/BTC chart support structure is also near failure. If these levels fail ETH will decline at a greater rate than BTC so supports likely won’t hold for ETH.
All the RSI’s are still trending down below the bottom band so there’s no reason to expect any stemming just yet.
Intraday charts show bullish divergence in the oscillators as momentum increases into new price lows, but if these supports break the potential countertrend price flips will likely be invalidated.
Basically, short term there are few reasons to do anything bullish right now IMO. Long-term buy bids are fine but I’d only be doing one as lower prices would be my expectation. Short-term speculation taking shorts at the level failures would be a potential way to hedge an underwater position. I wouldn’t be selling out of positions that were negative because there’s still no confirmation of those lower prices yet. I’d be waiting for daily closes beneath the support levels. Bullish positions in profit I’d take some off the table to derisk the position at those level breaks as well.
The image from this tweet warning of the bearish leg of the cycle shows where the cycles spin back up. We still have bearish pressure going into next week. I’d be VERY wary in trusting a short-term rally if it comes before then.
The bullish leg of the following cycle will likely have a lower expected ceiling in mid-June but I’d wait to see where this levels out to the downside before I start speculating on that. If we can’t recover into the 40k levels it’s likely the following downwards leg will send us back to these lows.
It could be a long drag until Q4 or next year before cycles are aligned to get major bullish momentum.
I’ll put some more details out tomorrow and over the next few days.
It’s been a wild time. Personally in all my time trading I’ve NEVER seen anything like the whole LUNA debacle.
During the crypto crash in May 2021, there was a brief rally the very next day. Do you think that kind of rally (or dead cat bounce) is likely tomorrow or that more downside is the likelier outcome?
During the crypto crash in May 2021, there was a brief rally the very next day. Do you think that kind of rally (or dead cat bounce) is likely tomorrow or that more downside is the likelier outcome?
No idea.
So the saga continues. Thanks.