Setting The Stage For Upside (Part 1) – Crypto Piece
Accumulation Will Pay Off Big
In just the last week, Donald Trump has started accepting Bitcoin donations for his campaign, the Congress has started showing support for Cryptos, and the SEC has signaled support for an Ethereum ETF. These are 3 major developments for the Crypto space, all of which are helping set the stage for further upside.
Bitcoin And Ethereum Technical Update
Since our last update (found here), Bitcoin has been trying to reclaim the $69k. This is the number we’re closing watching because a daily reclaim of the level would be a very bullish development for more upside.
Bitcoin has already reclaimed the 21 and 55 EMAs on the daily. Currently, it is retesting its 9 EMA and while we don’t have a strong opinion as to whether this will hold or not, the key level on the downside we’re watching very closely is $59.5k for the overall bullish posturing. A confirmed break below $59.5k would put the near-term bullishness at jeopardy (although this is not our base case scenario for now).
Ethereum has been even stronger on its bounce (partially cause of the ETF-related development), and has bounced from the $2850 support level in an aggressive manner. It found resistance just under the $3991 resistance level, but has managed to reclaim the support zone (between $3300 and $3550) for now. Retesting and holding this support zone would be a very positive price action development for continued upside.
The Dollar Index – Intermarket Analysis
A key intermarket dynamic we’ve been monitoring is the USD Index ($DXY). After a deviation above the range high, $DXY has been showing weakness. Although a short-term occurred after breaking below the 55 daily EMA, the momentum is still not bullish. Losing the 9, 21, and 55 EMA from here along with a bearish rejection on the MACD will be a very telling sign for risk-on assets (since downside $DXY = upside Risk-on). Therefore, it’ll be critical to closely monitor $DXY this coming week.
Bitcoin On-Chain Development
A very important on-chain development that just occurred is the “capitulation” signal that the Hash Ribbons indicator (courtesy of Capriole Investments) has just flashed. The Bitcoin Hash Ribbon indicator tries to identify periods where Bitcoin miners are in distress and may be capitulating. The assumption is that such periods can occur when the price of $BTC is at or near important lows, and may therefore present a good opportunity to buy the dip. This plays hand-in-hand with the Bitcoin Production Cost indicator we highlighted in our previous article (found here).
Another lesser used on-chain signal, but with an incredible track record, is also nearing a very powerful signal for Bitcoin. This is what we cover in the next section for our Paid Members. We’re also going to take a look at a Bitcoin fractal pattern, our Proprietary Cycles Forecast for Bitcoin and Ethereum, and the typical yearly Cycle that altcoins tend to display. Lastly, we’ll be covering a Crypto-related stock called BitFarms ($BITF) as it was requested by one of our Paid Members.
Please keep an eye out for a Part 2 follow-up of this article, which will be only for Paid Members, and will be covering a lot of altcoins, like: XRP, ROSE, FET, and some other AI-related coins, some of which are available on regular Crypto exchanges, while some are only available on decentralized Crypto exchanges. We want to present you with a mix of altcoins, so that based on your risk tolerance and Crypto exposure, you can decide which ones you find attractive. With $NDVA’s positive on-going developments, the AI narrative still looks very much intact.