Victor Cobra Calls The Shots! Just kidding.... (Crypto Update)
If you've been following me over the last couple of months, you'll see that most of my low-end targets had been reached, and that I've made some pretty accurate analyses. I said I'd stay away from the market, and I guess I failed myself on that one. What can I say, I'm a bit of an addict. I'm sure many of you can relate. I've been definitely paying attention to it less, but I've been pretty good at getting things right, so I thought I might as well continue analyzing since I find it fun. Hopefully others find it helpful in some way.
Anyway, I expected NEO to get down to at least the $5-6 area before any serious buying action, and I expected the same for ETH between $77 and 80. NANO once again hit its $0.75 demand zone and has rebounded pretty hard as well since then. XLM held the line just below 10 cents, which I thought had a strong chance of being its bottom. You can see all of these buying areas hit perfectly on my other charts (linked at bottom). These were all bearish targets that I've had in mind for months.
NEO hitting support:
ETH:
I'm happy to say that I've gotten most of my setups correct over the last couple of months, which is helping to boost my confidence as a trader. Still not actively day trading though, since it's family time for me : ) If things really start exploding, I'll look for places to exit my positions in stages along the way (kind of like what I did with SLT, since it's impossible to perfectly predict THE top). It is always possible that I'll be wrong (including in this analysis), so always form your own opinion based on the information available to you. I don't want to become one of "those" analysts, but I feel like talking about my accomplishments a bit. No shame in that. I always welcome criticism, and I'm still relatively new at this. That being said, I'm going to brag a little bit:
1) Sold some more SLT for XLM at 42.9 after initially buying at 2 and adding some at 6 (actually my sell order at 42.9 was the last one filled before it started tanking hard). Got really lucky with that one. Been selling since it broke 18 to the upside. Now it's below 20 again. Have a big order in the high 11 XLM zone, where I expect it to attempt support. I'll be watching that one, for sure.
2) Went long on TRX at around 345 (and 318) and predicted the breakout.
3) Called the breakdown of EOS to 5000, where I suggested we'd hit a major bottom in the crypto market.
4) Accurately predicted the slow rise of XRP after buying at 5000 and 7500. Charted its path up until this exact point, where I expect a major breakout may occur soon.
5) Called buying zones for NEO, ETH, and XLM.
6) Nailed the recent bottoms for GVT and VET before they were reached.
7) Anticipated the rejection at 6000 for BAT and the continued downtrend.
8) Called the recent bottom of ENG at 6000 before it happened (not including the stop hunt).
9) Said 3200 was likely a mid-term bottom for Bitcoin, and that the longs opening up before the pump were a potential sign.
10) Anticipated the Dow Jones drop from 25000.
11) This is yet to be seen, but called a top of the Dollar Index at around 97 (we'll see if this plays out).
Overall, I expected there to be a major buying opportunity in the market, which we have just seen. I even titled my analysis from November 13th (just before the crash) "Crypto: The Ultimate Test of Patience - Buying Opportunity Soon." I did get a lot of things right, but earlier I was wrong in assuming Bitcoin had bottomed at $5700 earlier this year, but I changed my view after the breakdown.
Now enough bragging. On to the analysis.
As you can see, we've bounced substantially from 3150 after RSI reached a weekly low and many were expecting further downside. Many people are wondering why Bitcoin didn't test 3K or even 2.9K. There are two reasons for this:
1) Too many people were expecting a major bounce at 2.9K so the order book was completely stacked everywhere from there all the way up to 3.4K. FOMO also exists its powerful influence when searching for a bottom, because people will try to get their order filled at the lowest point possible to get the highest % gains. Someone WILL time the exact bottom, but most will not. Traders know this so they stagger their orders. I actually expected a bounce before 3K (which is why I added more to my positions at 3.3K and not lower).
2) As I mentioned above, we reached HUGE demand zones for some major alts, and that happened before Bitcoin could go lower. Yet again, alt buying helped support the Bitcoin price (we saw the same happen on August 13th).
But where to now? We have major resistance at 4200, 4400, 4600, 4800...and the list goes on. It's possible that this could be a slow grind up because of this. In my last market analysis, I said we probably won't see Bitcoin prices much higher than the low 5K area, since I didn't think we could break out above the broken log trend tine. However, this bounce has ALMOST got me convinced that the bottom is in. I thought we'd see more of an extended bear market, but nothing has to happen in any particular way. A couple months ago, I initially made a guess that the bull market would return in late January/early February based on the timing of Bakkt and previous market cycles (particularly for NANO). I don't want to overload you with information, so I won't be going too much into that here. But I think chances are increasing that the end of the bear market will be soon. Additionally, I still believe some alts will challenge Bitcoin's market cap - particularly XRP, ETH, and XLM. This is made increasingly possible by more alt pairings (especially new XRP pairings on Binance today).
Now I'd still be extremely cautious. Margin traders will still get rekt in this low 4K zone, since there is so much space for us to move on either side. Most people know this, but the market will not be officially in bull territory until we get back above 6K and break the triangle resistance once and for all. We need to find support back above 6K for this to happen, obviously. This would confirm a giant bullish doji candle on the monthly chart (already forming), which usually signals the beginning of a bull run. Obviously, if we blast up to 6K very quickly, the likelihood of a bull run will increase further. If we fail in the low 5K area or even at 6K, the bear market will likely extend for another year at least, during which it's possible 3K will become our new 6K, maybe even eventually breaking it to search for even lower targets. You can see that scenario in red on my chart. And of course, we need to find reliable support at 4K before we even attempt those areas, which we seem to be trying to do right now.
However, it's really looking like a number of alts are in the early stages of bull cycles, so there could be A LOT of upside still to come, particularly for ETH, XLM, XRP, NANO,TRX, and even NEO. For a while, I've also been expecting the media to play a major role in the new retail money that needs to come in to support a bull run. Many institutional investors are likely already in, so we need retail money. The way I see this happening is with articles like "Crypto Rallies Amidst Stock Market Crash as New Asset Class Proves Its Worth" or "Bitcoin Rises As Stock Market Falls. Safe Haven?" The media is extremely powerful at inducing FOMO. Many people think that the crypto market will tank further if the stock market continues its decline into a deep recession (definitely possible), but I think that if enough people fear the collapse of big banks and the U.S. Dollar, they will want to move away from fiat.
IF a bull run starts soon, I expect it to play out kind of like the yellow line on my chart. Other possibilities are red and green. Total speculation obviously. So far, we've pretty much followed the red scenario on my Bitcoin And the Road Ahead Part II analysis (linked at bottom).
Just some hypothetical Setups:
1) Conservative Bullish Play
BUY 3600-4100
SELL 5100-6000
STOP LOSS below 3600
2) - Aggressive bullish play
BUY 5800
SELL 11000-13000
STOP LOSS Below 5400
3) - Aggressive bearish play
SHORT FROM 4600-4800 or 5100-5200
TARGET - 3400 or lower
Anyway, this is not a recommendation to buy or sell and I am not a professional financial advisor. This is simply what I'm seeing in the market right now and for educational purposes only. I'd still be very cautious. Remember, blindly throwing money at something expecting it to go up is GAMBLING, not investing. I'm in this for the long term because I want to hedge against a financial system and global economy that I think needs some major improvement. This is purely my opinion.
Merry Christmas & Happy New Year!
-Victor Cobra
Anyway, I expected NEO to get down to at least the $5-6 area before any serious buying action, and I expected the same for ETH between $77 and 80. NANO once again hit its $0.75 demand zone and has rebounded pretty hard as well since then. XLM held the line just below 10 cents, which I thought had a strong chance of being its bottom. You can see all of these buying areas hit perfectly on my other charts (linked at bottom). These were all bearish targets that I've had in mind for months.
NEO hitting support:
ETH:
I'm happy to say that I've gotten most of my setups correct over the last couple of months, which is helping to boost my confidence as a trader. Still not actively day trading though, since it's family time for me : ) If things really start exploding, I'll look for places to exit my positions in stages along the way (kind of like what I did with SLT, since it's impossible to perfectly predict THE top). It is always possible that I'll be wrong (including in this analysis), so always form your own opinion based on the information available to you. I don't want to become one of "those" analysts, but I feel like talking about my accomplishments a bit. No shame in that. I always welcome criticism, and I'm still relatively new at this. That being said, I'm going to brag a little bit:
1) Sold some more SLT for XLM at 42.9 after initially buying at 2 and adding some at 6 (actually my sell order at 42.9 was the last one filled before it started tanking hard). Got really lucky with that one. Been selling since it broke 18 to the upside. Now it's below 20 again. Have a big order in the high 11 XLM zone, where I expect it to attempt support. I'll be watching that one, for sure.
2) Went long on TRX at around 345 (and 318) and predicted the breakout.
3) Called the breakdown of EOS to 5000, where I suggested we'd hit a major bottom in the crypto market.
4) Accurately predicted the slow rise of XRP after buying at 5000 and 7500. Charted its path up until this exact point, where I expect a major breakout may occur soon.
5) Called buying zones for NEO, ETH, and XLM.
6) Nailed the recent bottoms for GVT and VET before they were reached.
7) Anticipated the rejection at 6000 for BAT and the continued downtrend.
8) Called the recent bottom of ENG at 6000 before it happened (not including the stop hunt).
9) Said 3200 was likely a mid-term bottom for Bitcoin, and that the longs opening up before the pump were a potential sign.
10) Anticipated the Dow Jones drop from 25000.
11) This is yet to be seen, but called a top of the Dollar Index at around 97 (we'll see if this plays out).
Overall, I expected there to be a major buying opportunity in the market, which we have just seen. I even titled my analysis from November 13th (just before the crash) "Crypto: The Ultimate Test of Patience - Buying Opportunity Soon." I did get a lot of things right, but earlier I was wrong in assuming Bitcoin had bottomed at $5700 earlier this year, but I changed my view after the breakdown.
Now enough bragging. On to the analysis.
As you can see, we've bounced substantially from 3150 after RSI reached a weekly low and many were expecting further downside. Many people are wondering why Bitcoin didn't test 3K or even 2.9K. There are two reasons for this:
1) Too many people were expecting a major bounce at 2.9K so the order book was completely stacked everywhere from there all the way up to 3.4K. FOMO also exists its powerful influence when searching for a bottom, because people will try to get their order filled at the lowest point possible to get the highest % gains. Someone WILL time the exact bottom, but most will not. Traders know this so they stagger their orders. I actually expected a bounce before 3K (which is why I added more to my positions at 3.3K and not lower).
2) As I mentioned above, we reached HUGE demand zones for some major alts, and that happened before Bitcoin could go lower. Yet again, alt buying helped support the Bitcoin price (we saw the same happen on August 13th).
But where to now? We have major resistance at 4200, 4400, 4600, 4800...and the list goes on. It's possible that this could be a slow grind up because of this. In my last market analysis, I said we probably won't see Bitcoin prices much higher than the low 5K area, since I didn't think we could break out above the broken log trend tine. However, this bounce has ALMOST got me convinced that the bottom is in. I thought we'd see more of an extended bear market, but nothing has to happen in any particular way. A couple months ago, I initially made a guess that the bull market would return in late January/early February based on the timing of Bakkt and previous market cycles (particularly for NANO). I don't want to overload you with information, so I won't be going too much into that here. But I think chances are increasing that the end of the bear market will be soon. Additionally, I still believe some alts will challenge Bitcoin's market cap - particularly XRP, ETH, and XLM. This is made increasingly possible by more alt pairings (especially new XRP pairings on Binance today).
Now I'd still be extremely cautious. Margin traders will still get rekt in this low 4K zone, since there is so much space for us to move on either side. Most people know this, but the market will not be officially in bull territory until we get back above 6K and break the triangle resistance once and for all. We need to find support back above 6K for this to happen, obviously. This would confirm a giant bullish doji candle on the monthly chart (already forming), which usually signals the beginning of a bull run. Obviously, if we blast up to 6K very quickly, the likelihood of a bull run will increase further. If we fail in the low 5K area or even at 6K, the bear market will likely extend for another year at least, during which it's possible 3K will become our new 6K, maybe even eventually breaking it to search for even lower targets. You can see that scenario in red on my chart. And of course, we need to find reliable support at 4K before we even attempt those areas, which we seem to be trying to do right now.
However, it's really looking like a number of alts are in the early stages of bull cycles, so there could be A LOT of upside still to come, particularly for ETH, XLM, XRP, NANO,TRX, and even NEO. For a while, I've also been expecting the media to play a major role in the new retail money that needs to come in to support a bull run. Many institutional investors are likely already in, so we need retail money. The way I see this happening is with articles like "Crypto Rallies Amidst Stock Market Crash as New Asset Class Proves Its Worth" or "Bitcoin Rises As Stock Market Falls. Safe Haven?" The media is extremely powerful at inducing FOMO. Many people think that the crypto market will tank further if the stock market continues its decline into a deep recession (definitely possible), but I think that if enough people fear the collapse of big banks and the U.S. Dollar, they will want to move away from fiat.
IF a bull run starts soon, I expect it to play out kind of like the yellow line on my chart. Other possibilities are red and green. Total speculation obviously. So far, we've pretty much followed the red scenario on my Bitcoin And the Road Ahead Part II analysis (linked at bottom).
Just some hypothetical Setups:
1) Conservative Bullish Play
BUY 3600-4100
SELL 5100-6000
STOP LOSS below 3600
2) - Aggressive bullish play
BUY 5800
SELL 11000-13000
STOP LOSS Below 5400
3) - Aggressive bearish play
SHORT FROM 4600-4800 or 5100-5200
TARGET - 3400 or lower
Anyway, this is not a recommendation to buy or sell and I am not a professional financial advisor. This is simply what I'm seeing in the market right now and for educational purposes only. I'd still be very cautious. Remember, blindly throwing money at something expecting it to go up is GAMBLING, not investing. I'm in this for the long term because I want to hedge against a financial system and global economy that I think needs some major improvement. This is purely my opinion.
Merry Christmas & Happy New Year!
-Victor Cobra
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We also have this interesting chart, which gives some technical support for our recent bounce. Another scenario is outlined there, with a bullish target at 7200.
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Looks like we're aiming for a 4K retest right now. Volume wasn't particularly high at 4200 today, so that wasn't great for the bulls. We need to head a little lower to reach some more buyers. REMEMBER, we area NOT out of the woods yet. Below our recent 3.2K bottom there is a long way to fall, including to the 1.8K region (at the red dotted line on my chart). A number of indicators are telling me we should be headed higher relatively soon, but be CAREFUL. We need to hold above 3.6K ideally.
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We've dropped down and have entered the 3600-3800 range for now, since we didn't see any follow-through buying. If we are to move up, I figured it would probably be slow. We really have a couple of scenarios at this point. Either this was a double top, similar to all of Bitcoin's double tops from this past year, or we are about to complete an inverse head and shoulders pattern. A breakdown of the orange line at 3545 could send us to new lows...possibly even the 1800 area I was talking about. But if we have a strong bounce somewhere between here and there that takes us back up past 4K, the inverse head and shoulders will be much more likely. No trade zone currently.
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Even though we are in a bear market and it seems like we're just going to drop further, some things are telling me that the market is actually coiling for a big move up...namely several alts, including TRX, XRP, ETH, and NEO. I guess we'll see how things play out over the next few days.
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Potential scenarios for the next week, where you can see the orange line more clearly:
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That orange support line goes all the way back to August, 2017. I find that historical pivot points like this tend to dictate a lot of price action.
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Volume has really dropped. This is often the sign of a bear trap, since volume usually increases with the trend. That's the only hopeful thing I can say for the bulls right now. What bulls will need is a stronger test of support and a bounce with increasing volume. Otherwise, bears will take control again.
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Getting very close to testing the orange line around 3540. If we break decisively below, we will likely have to re-enter the 3200 zone. RSI looks pretty bottomy, but volume is increasing a little. We should have a volume spike soon, depending on which way this breaks.
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From a charting perspective, it really seems like it's about to break down, but coins like XRP and TRX are still looking relatively strong. They still look like they're about to have major upside breakouts. Conflicting signals tells me we might have a surprise move up. But who really knows? This market is nuts.
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Well, I'm back from my vacation! Feeling refreshed. Looks like Bitcoin bounced near the orange line, and we're forming a smaller inverse head and shoulders within a larger inverse head and shoulders. The neckline seems to be around 3875, so a push above there soon should finally cause some follow through. The lack of volume is still concerning for bullish momentum though, which tells me that if we have an upside breakout, we won't be ending the bear market, and we'll have something more like the green or red scenarios in the main chart. This means a target anywhere from 4.7K to 5.3K (green X and converging resistance. Obviously we'll have to wait to see. For the bullish perspective, I'd like to at least see a breakout and a higher high (surpassing 4.4K). A number of alts seem like the've bottomed out on their Bitcoin ratios and are recovering nicely (ETH, NEO, ENG, etc.)
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We also seem to be forming a new support area (light blue)
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Things are starting to look weaker, for now. Many alts are slipping, and Bitcoin keeps getting rejected at every push up. Still a no trade zone. If we break down through 3.5K, there is a strong possibility we will test the lower 3K area this time. If it doesn't hold, we'll have to see where buyers step in next. There is still very little interest. I met a guy in the U.K. recently who has been selling his merch through Bitcoin for years. The last two years, he's seen the biggest decline in people willing to use it. Truly tells you the state of the market. The inverse head and shoulders is running out of time to form, in which case the pattern will probably resolve as a bear flag breakdown. We need to see a push up above 4400 (higher high) ideally with VOLUME before confirming any sort of bullish momentum.
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Some alts are starting to make some upside moves right now, so this would be a good chance for a bump upwards in price. Let's see how the rest of the day unfolds! I'll be stepping out to enjoy my New Year's Eve. Good luck everyone!
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ETH is on the verge of breaking back above its triangle support (as it did in March, 2017). This could be a huge indicator for the direction of the market. If it does break out, this was likely the bottom, at least for a while, and we will see a market-wide upswing soon. Several months ago, I had a feeling that the earliest a bull run could start would be January/early February 2019. This was based on the timeframe of Bitcoin's 2011 bubble cycle, which I see as similar to the altcoin bubble from 2017.
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ETH is JUST about to break back above its triangle support. If it confirms this move, we may finally see some buyers show up for Bitcoin and other alts.
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If we have a market-wide breakout now, Bitcoin dominance will likely slip below 50% for the first time since August.
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Very interesting what's happening now. It seems that the market wants to go up, but buyers are not finding enough confidence to buy above resistance areas. It really depends on who is the stronger side. Both bulls and bears are really fighting over this 3850 zone. What happens here will decide the direction of the market for the year to come, in my opinion. Since buyers have not been able to step in, I think the possibility of another selloff is increasing, since we're still in a bear market. Time has almost run out to form the right shoulder of the inverse head and shoulders.
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This weekly candle needs to close green, and bulls have been really struggling to make that happen so far.
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Since buyers failed to show up, we've dropped a bit. We need to see buyers step in here, or else we'll slide back down to 3600 or lower, in which case my mid-term bullish view will be invalidated.
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Looks like we're having our push up! There were a lot of signs, since many alts seemed to be moving ahead. However, now we have confirmation of the move. We ideally need to see us hold above 4K on Bitstamp and then target a higher high on the weekly chart before we have any chance of testing 5K.
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The weekly candle will, more likely than not, close green. This is a really good sign for the bulls. Let's see if we can get some more volume going and sustain. My bias has been to the upside recently. I noticed a lot of absorption going on at certain levels (3.2K, 3.5K, and more recently 3.8K). What this is means, is that I noticed people's sell orders instantly getting bought up, taking the price back to support rather quickly. This kept on happening and signaled accumulation to me. Congrats to anyone who went long over the last several days.
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We will need to see follow through after consolidating here. Even though the inverse head and shoulders seems more plausible now, it can always become a failed pattern if we crash back down. Make sure that if you're trading this, you exercise risk management. We are still in a bear market until a sustained higher high.
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By the way, a bearish argument can be made now because ETH has failed to confirm a new cycle, as of yet. ETH needs to head ideally above 0.042 on the ratio in order to confirm that the whole market wants to move up. For now, this is a Bitcoin show. Until alts see more buying, this has a possibility of ending up as a failed rally. Or, you know, people are just scaling into BTC, hoping to catch the next move.
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Some hopium for the bears. Obviously if we break out here, bulls will have the upper hand. Saw someone posted this resistance on Reddit:
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The above chart makes it look like if we fail here, we go straight down to 2K. It looks like that light blue resistance is the first thing that needs to break, if we're going to make any steps towards ending the bear market.
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This is pretty scary, to be honest. A perfect opportunity for bears. Bulls need to push out of that light blue line. Even though it seems absurd, nothing has to make sense in this market. This line CAN become resistance. On a good note, if it's broken, we should have some decent upside in the coming days.
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The people fearing a bart move are right, since we aren't really forming higher lows on shorter timeframes. This triangle has more of a flat base than, which could indicate a descending triangle and weakening buyers. RSI is cooling off a bit, which is good, but we need to see a big push up soon to confirm this as a bull flag. We haven't dropped much yet, and we're consolidating JUST below the light blue line.
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On the hourly chart, we've now had 3 touches of that scary resistance. I would say it's confirmed at this point, and a big failure here would indicate SEVERE weakness in the market. I'm not trying to be a fear monger or anything. That's just what the chart says. In any case, we did also just form a bit of a higher low on that random flash dump. This indicates that buyers haven't completely given up at taking on the resistance. We could end up forming more of a bull flag. Based on the absorption going on over the last couple of weeks, I can easily see this playing out, as buyers have shown more interest in accumulating, at least. We also could be forming a descending broadening wedge. There are a number of possibilities. I honestly think it's best to stay out until the resistance is broken.
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Binance (USDT) actually looks a bit more bullish:
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Every time it seems like it's about to drop hard, the price gets absorbed. This is the kind of absorption I noticed at lower prices, which led me to become bullish. However, buyers can only buy so much before they get exhausted, and bears have been mysteriously absent. For now, as I've said, I wouldn't be surprised to see a surprise selloff.
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Better lines for the Binance chart:
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Even though we've had so much absorption going on, the market is really starting to look weak. Volume has died down, which might indicate a bear trap, but it also could easily indicate buyer exhaustion. Something in my gut tells me to be worried. Bitcoin is still in this range, but many alts are dropping, especially ETH.
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It looks like we've broken out of that resistance I was worrying about! We're still below it on the Bitfinex chart, but I'm feeling a bit better about the market now. We might end up following my red scenario in this chart after all. Some major alts are still showing very bullish signs (TRX, NEO, LTC, etc.). ETH has pulled back since it's run, but could just be gearing up for the next push.
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The only thing concerning me now is volume. It has not increased much on this mini-bounce. In this case, there is still a good chance for a bart move down. Tricky market these days.
