Crypto Radar is a regular dive into the field of technical analysis combined with our view on the Macro and Micro environment. These updates will help paint a picture from an investment point of view on the potential movements we are likely to see in the short to medium term. Note this is for demostrational purposes only not financial advice!
Bitcoin
Following on from 007 we can see that the break out on bitcoin is respecting the momentum pathway and now on its bullish approach back up to 60k region.
The Wealth Gap View : We may see a pull back to retest the 42k-44k region to gather momentum for the next leg up. If not then we are likely on track for a swift move back up into the 60k region ready to retest resistance. If Bitcoin breaks above the 60k region and stays above finding a new level of resistance then its off to the races for new time highs and the next major leg up into the 4th quarter of 2021. We expect large movements in the next 4 months. Watch this space.
Bitcoin Current model Top
This chart is pulled from the analyst Willy Woo who uses a lot of on-chain data to design predictive models for looking at potential outcomes of market structure and price on bitcoin. See below his current Signalling model has a rough top of $167,000 for bitcoin in this cycle before a potential bearish retrace. Note* this model constantly adapts to data so this signal will change over time. If metrics increase to the bullish side then that number can and will likely go up. Previously this model was sat higher above the $250,000 mark.
Dow Jones (Worrying)
The below chart is of the Dow Jones Industrial Average which is is price weighted measurement stock market index of the 30 most prominent companies listed on stock exchanges in the United States. Its a snap shot of the valuations of the most important US companies. The current list can be seen here.
From a “Trading” perspective this chart fills us with the Heebie-jeebies! This is because the reflation (upward rapid growth/drive) out of covid is due to government stimulus (money printing) which is still at a rate of $120billion a month in the US alone. This will eventually have to ease. When the FED does start to signal an end to the stimulus the the markets will likely pre-emptively sell off. If we rapidly move from the new highs down to the top diagonal line (highlighted by the red circle) and still do not find any support… well lets just say holding bitcoin will likely feel like a privilege in such a scenario.
While the money printer goes Brrrrrr everything will look and feel fine. Every one is a hero in a bull market regardless of whether it’s a fake one driven by debasement and false confidence.
Till next time
The Wealth Gap Team