Weekly market recap (from Jan. 11th to Jan. 18th)
Last weekend, The kingdom of Tonga suffered a catastrophic volcanic eruption. The interruption of communication keeps the world unable to get the latest information. We wish the people in Tonga safe and sound. God bless Tonga. 🤞
After the price touched the resistance level (39,700) at the early of last week, the strength of the long side increased significantly and once rebounded to 44,000. We can see a strong support level (40,700) which is the start of the second part of the bullish channel last year. This also makes the subsequent price rebound to 44000. But the price did not stand firm at 44,000 after two days of rising and it entered fluctuation of the narrow range in the following days. Neither long nor short has a clear confirmation. As the volume of the short side increased yesterday, the price may retest the support level.
Conclusion: High probability of fluctuation and it is more likely to fall than to rise. At 1D level, the long side is still weak in the process of rebounding. It is difficult to say the price was at the bottom. The price will mostly fluctuate in the range(40500, 44000) until the direction is confirmed.
In the last weekly market recap, we mentioned ETH’s poor performance in the second half of the decline. Last week, ETH rebounded so powerfully. Although the price is still below the resistance level (3,400) given in the last recap, the change in the performance of the long side may make up for the previous panic decline and mean something interest which we will share after the TA. Back to ETH, the price was pushed to 3,400 by the long side and even after strengthening of the short on Jan.13, the price was brought back to the previous high for the second time. On the other hand, judging from the shape of the candles, we notice that the short side has not given up. The confrontation is fierce between long and short.
Conclusion: Mostly fluctuation and there is a certain possibility that the rebound has not ended.
At a large level, the bearish channel of ETH has not been destroyed, but based on the strengthening performance of the long side, the price may fluctuate in the range of (3000, 3400). If the price can threaten the upper rail of the channel like the green arrow show, we think the long side will regain control.
During the decline in the week (3rd-9th), it is not difficult to find that the long side was strengthening which explains that the price even reached 160 in the subsequent rebound process. But similar to ETH, the short side of SOL did not decrease in the rebound. There is not enough evidence to show that the reversal will start. With the appearance of the long candle yesterday, the trend was still not clear.
Conclusion: Mostly fluctuation. The strengthening of the long side before confirmation at 1D level can’t lead to a reversal at a larger level, but may bring the price closer to fluctuation. We hold the previous resistance level (150), because it wasn’t broken effectively. As the long side reacted, we moved to support up to 132.
In the first half of Jan, the market experienced processes of policy crash and recovery. As we mentioned in the TA, ETH and SOL were significantly weaker than BTC in the first seven days of Jan, but as shown in the rebound, they performed better. This phenomenon reflects the market’s recovery after the overreaction of the hike. It can also be proved by the market reaction when the US CPI is announced on Jan.12. Worse inflation indicator has not brought panic again. Both BTC&Gold remain the rising trend when the indicator was released.
The good news is that there are no significant indicators or events that will be released this week. The crypto market may ‘walk’ at its own pace, not subject to policy bombs.
Disclaimer: Nothing in the article constitutes investment advice. The article objectively expounded the market situation and should not be construed as an offer to sell or an invitation to buy any cryptocurrencies.
Any decisions made based on the information contained in the article are your sole responsibility. Any investments made or to be made shall be with your independent analyses based on your financial situation and objectives.