BTC Weekly Outlook (FA&TA)
Updated
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Key Fundamentals:
1. Smart money action:
The on-chain smart money actions are now stable at a bullish level. This is similar to the on-chain developments before prior bull runs. Institutional investors showed picked up interest in the crypto space as Grayscale raised 900M in Q2 (its ATH quarter since inception). The 900M won’t be available for exiting until at least October 1st this year.
2. Miner action:
Both hash rate and difficulty have recovered, and miner capitulation has ended. With miner capitulation historically marking market bottoms, this is a bullish long-term sign.
3. Market Sentiment:
Overall market sentiment is now neutral. For the seller group sentiment, this group remains in a bull trend. The decrease in seller group supply alert was present throughout the past week (meaning price is getting close to this group’s purchase price, leading to a decrease in willingness to sell, leading to a decrease in supply, which increases price when the demand maintains a similar or higher level). In short, long-term speaking, 11k – 11.5k is the dip.
4. Margin Market Actions:
Potential short squeeze alert in place on 8/26. This is a short-term bullish sign. The CME institutional traders’ significant increase in long positions last week is crucial. After 3 months of indecisiveness (since 10k), it seems like institutional traders have finally made up their minds that we are in a bull trend and have further upward potential. With such strong reactions to 11k - 11.3k, the chance of 12k being broken is extremely high in the coming month or so.
5. Global Market Impact:
To ease the COVID impacts, the Fed is using all means to boost the economy, which means a continued rise in inflation. This will fundamentally push up the value of gold, bringing up bitcoin along the way as the main value proposition of bitcoin remains store of value rather than remittance.
For the SPX correlation, as mentioned many times before. I think major SPX correction will bring down crypto, while smaller ones won’t. So will we have a major SPX correction soon? Personally, I think the answer is no. Q2 numbers didn’t cause much of a market impact. What this means is the current price level already has the negative COVID impact priced in. The market runs on expectations rather than actuals.
6. CME Gap
90% of historical BTC CME gaps get filled sooner or later (generally created by weekend BTC movements when the CME’s closed). Yes, we still have a $300 gap open on 7/25. However, after such a long time, the gap filling (big if here) will be more of a result of general market movements rather than the cause. The current gap is a $200 gap from 11.5k. Since these gaps tend to be filled, it's better to take profit for long scalping positions now and reenter around 11.5k. For swings, the 2% may not be worth playing given fees and the chance of missing out the larger move. I can't emphasize this enough - we are in a bull run -> adjust risk management accordingly!
Key Technicals:
1. Major resistance at 12k. Support at 11k.
2. Elliot wave: likely in wave 2 of 3. However, corrective waves are complex, and several counts are all possible at this point. I’ll share the detailed count once the picture gets clearer. Check out the blue box in the chart.
3. RSI neutral:
Failing the RSI MAs but already found support around RSI 47 - historical bull market support for BTC Daily time frame.
4. MACD neutral:
Likely up-cross on the positive side soon.
Do you agree or disagree? All thoughts and critics are welcomed!
====================================================
🌐 We believe in the power of blockchain data analysis!
====================================================
Key Fundamentals:
1. Smart money action:
The on-chain smart money actions are now stable at a bullish level. This is similar to the on-chain developments before prior bull runs. Institutional investors showed picked up interest in the crypto space as Grayscale raised 900M in Q2 (its ATH quarter since inception). The 900M won’t be available for exiting until at least October 1st this year.
2. Miner action:
Both hash rate and difficulty have recovered, and miner capitulation has ended. With miner capitulation historically marking market bottoms, this is a bullish long-term sign.
3. Market Sentiment:
Overall market sentiment is now neutral. For the seller group sentiment, this group remains in a bull trend. The decrease in seller group supply alert was present throughout the past week (meaning price is getting close to this group’s purchase price, leading to a decrease in willingness to sell, leading to a decrease in supply, which increases price when the demand maintains a similar or higher level). In short, long-term speaking, 11k – 11.5k is the dip.
4. Margin Market Actions:
Potential short squeeze alert in place on 8/26. This is a short-term bullish sign. The CME institutional traders’ significant increase in long positions last week is crucial. After 3 months of indecisiveness (since 10k), it seems like institutional traders have finally made up their minds that we are in a bull trend and have further upward potential. With such strong reactions to 11k - 11.3k, the chance of 12k being broken is extremely high in the coming month or so.
5. Global Market Impact:
To ease the COVID impacts, the Fed is using all means to boost the economy, which means a continued rise in inflation. This will fundamentally push up the value of gold, bringing up bitcoin along the way as the main value proposition of bitcoin remains store of value rather than remittance.
For the SPX correlation, as mentioned many times before. I think major SPX correction will bring down crypto, while smaller ones won’t. So will we have a major SPX correction soon? Personally, I think the answer is no. Q2 numbers didn’t cause much of a market impact. What this means is the current price level already has the negative COVID impact priced in. The market runs on expectations rather than actuals.
6. CME Gap
90% of historical BTC CME gaps get filled sooner or later (generally created by weekend BTC movements when the CME’s closed). Yes, we still have a $300 gap open on 7/25. However, after such a long time, the gap filling (big if here) will be more of a result of general market movements rather than the cause. The current gap is a $200 gap from 11.5k. Since these gaps tend to be filled, it's better to take profit for long scalping positions now and reenter around 11.5k. For swings, the 2% may not be worth playing given fees and the chance of missing out the larger move. I can't emphasize this enough - we are in a bull run -> adjust risk management accordingly!
Key Technicals:
1. Major resistance at 12k. Support at 11k.
2. Elliot wave: likely in wave 2 of 3. However, corrective waves are complex, and several counts are all possible at this point. I’ll share the detailed count once the picture gets clearer. Check out the blue box in the chart.
3. RSI neutral:
Failing the RSI MAs but already found support around RSI 47 - historical bull market support for BTC Daily time frame.
4. MACD neutral:
Likely up-cross on the positive side soon.
Do you agree or disagree? All thoughts and critics are welcomed!
====================================================
🌐 We believe in the power of blockchain data analysis!
====================================================
Note
Price now close to the active trader group’s purchase price. These have been good accumulation opportunities historically as the reluctance to sell with no profit in a bull market eventually will push up the price level. 
Note
Bull run emotional cycle: depression, disbelief, hope, optimism, belief, excitement, thrill, greed, euphoria. Which phase do you think we are in? My pick is disbelief. 
Note
Smart money accumulating. Long after the CME gap from 10.5k closes.
Note
Are you in profit? W/ 50% USDT mkt cap increase (since 12k), and Grayscale's all-time-high quarter again in Q3, BTC fundamentals are solid and indicate further bullish momentums to come.
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