No clear trend and low volatility

TL;DR:

  • Our market view (mid-August):
    • Short-term: Neutral
    • Long-term: Negative
  • Crypto and traditional markets have bounced significantly in the previous month. Bitcoin appreciated by 17.7% in July.
  • Crypto Total Market Cap (TOTAL) lost another 5.1% in September. Consequently, the year-to-date return currently stands at -58%.
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Market overview

In September, the crypto market experienced another sideways price action with few short-term pumps and dumps. In general, last month was a negative month as investors are (still) focused on inflation data and Central Banks statements. The main question remains, when the Fed will reach the pivot point and turn monetary policy from restrictive to neutral or even better to accommodative?

 

On the weekly time frame, we noticed some bullish divergences that can lead to a short-term bounce. However, we still recommend investors to remain defensive and wait for more signs that the bottom has been reached or at least a period of accumulation is beggining. Until Bitcoin price exceeds long term moving averages (showed with red and white lines on the chart below) and those averages start turning the curve upside, there is a low risk/reward ratio. It’s better to stay on the sidelines than to catch a falling knife.

TOTAL_2022-10-14

Long term view is still negative until Bitcoin’s price stays below crucial (weekly) trendlines. Our Market Stages Model is still in red, which indicates a more defensive approach to the market, focusing on risk management.

BTCUSDT_2022-10-14

At the moment, $18-18.5k seems the most critical level for Bitcoin. In the last 30 days, this support level was tested three times, each time followed by a price bounce. The sentiment was too pessimistic in both traditional and crypto markets, which is the reason the market has rebounded that quickly.

 

On the other hand, as mentioned in our previous reports the 100-day exponential moving average (white line – currently at $21.8k) represents a crucial resistance. If this level gets cleared, the $25k and the $28k are the next significant levels to pay close attention to. Moreover, the relative strength is still in favor of Bitcoin against Altcoins.

Crypto market view (2022-07)

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DISCLAIMER: This article is for informational and discussion purposes only and does not constitute a marketing message, an investment survey, an investment recommendation, or investment advice. The article was prepared exclusively for a better understanding of market dynamics.