This Consolidation Is A Blessing – Crypto Piece
Pullbacks Are For Buying
A lot of people on Twitter are calling for $50k Bitcoin on Twitter in anticipation of the pre-halving pullback, which is atypical of the past cycles. However, Bitcoin has shown time and again in this cycle that the pullbacks have been much shallower than most expect, including us at one point. Therefore, we’ve decided to wait for price action to actually breakdown, before we entertain a deeper pullback possibility to the $53.1k support level. For now, it seems like Bitcoin is consolidating in a triangle pattern (bullish consolidation), with the apex right around the expected halving date of 20th April.
On the 4-hour chart, Bitcoin bounced off the 4-hour 200-exponential moving average. Moreover, it has formed a bullish RSI divergence, with higher low on price and lower high on the RSI. These factors are signaling that at least a bounce is likely from current levels, but we’re not ruling out new highs, especially when crypto Twitter is busy expecting a deep pullback. However, if the lows of $60k from March are broken, then $53.1k is very much on the table. Until then, this is still a bullish consolidation with continuation being the likely outcome.
Ethereum
Similar to Bitcoin, even Ethereum is in a triangle consolidation. Price is currently right around the support zone between $3300 to $3550. A break below the triangle consolidation support would put $2977 into play, but a break above would mean a revisit of the local highs around $4k and most likely a move beyond it.
Intermarket Analysis
A key factor to note is the daily bearish RSI divergence for the USD index ($DXY), just when Bitcoin is having a bullish RSI divergence, albeit on a 4-hour timeframe. If this bearish divergence plays out, it could mean losing the mid-range region around $103.5 and that should be a tailwind for Bitcoin.
There’s another very important intermarket dynamic that has occurred, which is signaling new highs for Bitcoin. We’re going to cover this in the next section for our paid members. The paid section is also going to take a look at the altcoin market and a couple of Bitcoin miners ($CLSK and $MARA). Lastly, we’re going to provide the Cycles Forecast for $MARA until mid-June, which is nearing a solid Money Making opportunity.
We just released our Q2 2024 Cycles Forecast for multiple different asset classes and equity names. The introductory article for the quarterly Cycles Forecast can be found here. Please note that our Founding Members have now been emailed these Cycles Forecasts (the full deck covering every name!). If you would like your copy earlier for the next quarter, please consider upgrading to a Founding Member status on our Substack.