Dec 28, 2020: Crypto market review

by | Dec 28, 2020

Disclaimer: Posts on the HyperTrader blog and associated HyperLinq websites are for educational and informational purposes only. These posts should not be taken as financial advice, nor are they meant to be viewed as trading advice. HyperLinq Inc. or the authors take no responsibility for any damages or losses.

BTC

BTC has broken the ATH and is in the unknown waters right now. As a trader, I use FIBs and critical levels to navigate the price action.

The FIB

In a couple of my previous reviews, I have been presenting a FIB using monthly levels. It starts at point (A) and ends at point (B).

Let’s jump into the 240 chart depicted below.

We can see that the current 240 candles bounced off precisely from the -2 level of the FIB. I take it as an additional confirmation that BTC is following FIB.

Additionally, there are a couple of price levels indicated by the FIB tool that portray historical trends:

  • The price found support at the 0.618 ($6,268) level of the FIB, which is one of the levels called the Optimal Trade Entry or Golden Pocket.
  • Then the price bounced off from the 0 ($10,854) level.
  • Another bounce from -1 ($18,274)
  • This week it was terminated at -2.272 ($27,712) level.

If we look at the weekly candle high, it is $28,422, which means that the price got stopped at $28k. This brings us to the second way I am looking at a price, i.e., fundamental levels.

The key levels

There is a theory of the Institutional Levels, which was introduced by ICT. You can find a lot of material about this method on his Youtube channel; hence I will not elaborate on it here.

Since BTC is above ATH now, there are no classic support/resistance levels to use. This is where Institutional Levels kick in. I have marked four critical levels in the chart below: $20k, $22k, $25k, and $28k.

It is easy to spot that the previous ATH, which was around $20k, while this week BTC has spanned between $22k and $28k.

Combining the FIB and critical levels

BTC is no doubt bullish, and it seems that it has not found its top yet. For BTC to turn bearish, a reversal would need to form on the weekly chart. For now, we are far away from this.

 What I would like to see for bullish continuation:

  • For continuation next week, I would like to see the 240 charts to find support at the -2 ($25,694) and the $25k levels.
  • Should a deeper retrace occur – I would like to see the support at the $22k level. It is confluent with the -1.618 ($22,859) level of the FIB. Then I would like to see a bounce off to $25k and consolidation.

Notes on ALTS

I will get back next week with a more in depth analysis of alts. In this review, I will highlight facts that I find essential for XRP and LINK.

XRP

XRP has noticed a tremendous drop this week. I have highlighted that high volume associated with the swing high and XRP would need to form a swing low with a similar volume in my previous reviews.

Now we have it! The daily chart below presents the volume for the swing high and the importance of current levels.

The ONLY formation I am watching at the moment is the ICT bullish breaker on the monthly chart. It is being presented on the chart below.

For XRP to remain bullish, the monthly candle should close above $0.28, which is the top of the monthly bullish breaker. Notice that this level is confluent with the Institutional Levels theory.

Future weekly candles may dip below $0.28 but should close above this level.

In my last review, I have presented the weekly chart with the BUY and SELL zones. 

Today’s chart looks like this:

LINK has made a 28% dip below the Low of the range, but it has closed within it. LINK is still under selling pressure; hence I think we may see another plunge into the BUY ZONE. In case you missed the long entry this week, then you might try to long anything below $10.

More to come in the next review, where I would be making the summary of the year. See you then.

Founder & CEO at HyperLinq Inc.
Founder & CEO at HyperLinq Inc.

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