Bitcoin ETF Approved, What’s Next? – Crypto Piece
Bitcoin Hit Our $47k Target
Bitcoin ETF has finally been approved! Congratulations to all the long-term Bitcoin holders who kept high conviction in this asset class. Simultaneously, Bitcoin has also hit our $47k target, and has now entered the resistance zone (read: danger zone). This is where major supply lies and clearing this zone would require a lot of fuel, something that we don’t believe Bitcoin currently has after a magnificent run up.
With another new Bitcoin high, the daily RSI has put in another drive of bearish divergence, making a total of 3 drives now. This signals strong underlying weakness that’s building.
Moreover, Bitcoin has already cleared up a significant amount of upside liquidity. In the process, there’s a lot of liquidity that’s left towards the downside, especially around the $34k region (yellow line in the chart below, courtesy of Coinglass). This liquidity tends to act as a magnet for Bitcoin on most instances.
Bitcoin might have some more upside left, but wouldn’t bet on that anymore. However, the risks to the downside are significantly higher hereon. In the coming months, we believe that Bitcoin is very probable to chase the liquidity sitting around the $34k region and also likely to retest its previous key resistance as support around the $31.5k region. Prices around these regions would make us aggressively bullish on Bitcoin once again.
What About Ethereum?
Glad you asked. Ethereum has also hit out $2500 target and that too in a fashionable manner. While ETH could continue running higher in the coming weeks (mini-alt season), we’d place the upper limit around the $2975 zone for this run. Of course, this would only be met if Bitcoin puts in a topping pattern instead of a big crash, which would give Ethereum room to run before making a sharper pullback. We’ll highlight the pullback levels once we believe that the deeper correction for ETH is in play.
Similar to Bitcoin, Ethereum has also been building underlying weakness with bearish RSI divergence on the daily time frame. However, ETH has only built 2 drives, and it’s possible that it prints its 3rd drive on its way to the $2975 mark.
ETH/BTC Ratio
In recent weeks, we had also been encouraging our members to bet on ETH relative to BTC because the ETH/BTC ratio was in the value zone. After a slight deviation below this zone, ETH has now begun outperforming BTC by over 10%. This ratio is nearing the downtrend line and a break above would put the 0.0596 level in play, indicating another 6% outperformance. Reaction at the 0.0596 region would be critical in determining which one outperforms going forward.
Initially, we thought of putting the next chart under the paid section, but we wanted to give you a taste of what type of material we provide in the paid section:
This chart gives us insights into when we can expect Bitcoin + Ethereum + Stablecoins to outperform versus the rest of the altcoins to outperform. The reason we put Bitcoin, Ethereum and the 2 major stablecoins (USDT and USDC) together is because of the growing importance of these 4 names for investors looking to park their crypto capital. The rest of the altcoins are much more risk-on, but can provide incredible returns if timed well.
The chart below shows the market cap of Bitcoin, Ethereum, USDT (Tether stablecoin) and USDC (Circle stablecoin) in the top panel and the Bitcoin dominance % from 2018 to 2021 in the bottom panel. The top panel seems to be closely following the structure of the bottom panel, which gives us a clue of what to expect for the rest of 2024. While the altcoin world (excluding Ethereum) is poised to slowly gain market share in the coming weeks, the real risk-on move isn’t until much later in the year. We’ll be tracking this structure closely and will notify our paid members immediately when it’s time to go full risk-on mode in cryptos, along with providing attractive “long” setups. Our aim is to help you make life changing money this crypto bull cycle!
For our Paid Subscribers, we have something very special. In the next section, we’ll reveal the 2024 Cycle Forecasts for Ethereum, CleanSpark ($CLSK) Bitcoin miner and Marathan Digital ($MARA) Bitcoin miner. We’ll also provide a very interesting alpha to maximize the upside from $CLSK and $MARA.
Please note that Founding Members receive ALL of our updated Quarterly Cycle Forecasts for Indexes, Sectors, Cryptos (including multiple altcoins), Commodities, and The Magnificent 7 sent out via email a few weeks before the beginning of each quarter. This is a must have product for those looking to find a timing edge in the market and be prepared for sharp drawdowns and big run ups. Consider upgrading your membership to the Founding Member plan. We have more benefits in the works for this membership.