Just dawned upon to look at these two heavy weights of crypto side by side, on their weekly charts, especially since two major events: The ETH Merge, and that almost all asset classes are down drifting for a while now.
Here we have BTCUSD and ETHUSD on weekly charts, since January 2022 till December 2022.
Both had dropped from their March high, way below the 55EMA. Since then, it exceeded the Bollinger Lower Band and returned with a bounce, at least with ETH there was a better bounce. BTC just consolidated sideways since June lows. for a start, that is good, since the rather quick and significant devaluation eased the momentum. You can see this by the RPM tapering off.
If we think this starts to look good, we might beg to differ. What is not shown here is the higher time frame TD Sequential Setup in the monthly chart. Do that and you would see (not shown here) that the TD Sequential Buy Setup ended last month, in August. Issue here is that it was not Perfected. With this indicator, there is a special rule about Perfection that you need to know. Perfection is the criteria that the lowest (or highest) of candle 8 or 9 has to exceed the lowest (or highest) of candle 6 or 7.
And in the cases for both BTC and ETH, it did not.
Which goes to the next point, the consequence of an Imperfect Setup: The last low would be retested, typically within the next 3 candles, and sometimes up to the next 5. Furthermore, this extension for perfection may have a range equivalent to the range of the candle that has the lowest low (or highest high).
For more reading about what was just described, you can read a summary from this blog post or as I described before, the DeMark Indicators book by Jason Perl and foreworded by Thomas R. DeMark himself.
Having put all of that together, the range and region has been marked out with a yellow box. This projection area is based on the TD Sequential Setup rules.
BTC should be taking out the last low of 17592, and can have the potential to go as far down as 4000. However, there are two strong supports at about 10,000 and 12,000 where a possible bounce might happen (area marked with orange ellipse). And in conjunction to the weekly TD Seq Setup, The next 4 weeks might be pushing further down to complete the current setup. You know this is happening when BTC breaks down below 19,000.
ETH. similarly, should be taking out the last low at 883, but while the range puts is below 0, it might be more likely to bounce about 450-500, where a strong support should be holding. Breaking down below 1,400 is a good indication that ETH is playing out to complete its setup.
The technical indicators of the RPM and MACD do not quite align with further downside, which can be taken as a relief, as this suggests that a bounce off a support is likely, and a divergence is probable.
Overall, BEARISH on Crypto until the last low is taken out.
It appears that the last low needs to be taken out (even a spike down and bounce up qualifies) and it should be happening some time within the next three months of September to November. The most likely period appears to be in the next 4 weeks, up until mid-October.
IMHO, the sooner this happens, the better eventually as we get some level of closure on this clear and present bear market in crypto.
Meanwhile, if you read about others talking about a massive bull run, they might not be too wrong... just perhaps a little too ahead of the curve. All I can say is keep an open mind, have a keen eye, and be very very nimble in thinking, in strategy and also in whatever portfolio you might have.
Meanwhile, stay well and safe!
Here we have BTCUSD and ETHUSD on weekly charts, since January 2022 till December 2022.
Both had dropped from their March high, way below the 55EMA. Since then, it exceeded the Bollinger Lower Band and returned with a bounce, at least with ETH there was a better bounce. BTC just consolidated sideways since June lows. for a start, that is good, since the rather quick and significant devaluation eased the momentum. You can see this by the RPM tapering off.
If we think this starts to look good, we might beg to differ. What is not shown here is the higher time frame TD Sequential Setup in the monthly chart. Do that and you would see (not shown here) that the TD Sequential Buy Setup ended last month, in August. Issue here is that it was not Perfected. With this indicator, there is a special rule about Perfection that you need to know. Perfection is the criteria that the lowest (or highest) of candle 8 or 9 has to exceed the lowest (or highest) of candle 6 or 7.
And in the cases for both BTC and ETH, it did not.
Which goes to the next point, the consequence of an Imperfect Setup: The last low would be retested, typically within the next 3 candles, and sometimes up to the next 5. Furthermore, this extension for perfection may have a range equivalent to the range of the candle that has the lowest low (or highest high).
For more reading about what was just described, you can read a summary from this blog post or as I described before, the DeMark Indicators book by Jason Perl and foreworded by Thomas R. DeMark himself.
Having put all of that together, the range and region has been marked out with a yellow box. This projection area is based on the TD Sequential Setup rules.
BTC should be taking out the last low of 17592, and can have the potential to go as far down as 4000. However, there are two strong supports at about 10,000 and 12,000 where a possible bounce might happen (area marked with orange ellipse). And in conjunction to the weekly TD Seq Setup, The next 4 weeks might be pushing further down to complete the current setup. You know this is happening when BTC breaks down below 19,000.
ETH. similarly, should be taking out the last low at 883, but while the range puts is below 0, it might be more likely to bounce about 450-500, where a strong support should be holding. Breaking down below 1,400 is a good indication that ETH is playing out to complete its setup.
The technical indicators of the RPM and MACD do not quite align with further downside, which can be taken as a relief, as this suggests that a bounce off a support is likely, and a divergence is probable.
Overall, BEARISH on Crypto until the last low is taken out.
It appears that the last low needs to be taken out (even a spike down and bounce up qualifies) and it should be happening some time within the next three months of September to November. The most likely period appears to be in the next 4 weeks, up until mid-October.
IMHO, the sooner this happens, the better eventually as we get some level of closure on this clear and present bear market in crypto.
Meanwhile, if you read about others talking about a massive bull run, they might not be too wrong... just perhaps a little too ahead of the curve. All I can say is keep an open mind, have a keen eye, and be very very nimble in thinking, in strategy and also in whatever portfolio you might have.
Meanwhile, stay well and safe!
