Bitcoin Report – 11/25/22

BITCOIN & MARKET UPDATE

Weekly Timeframe:

Good morning!

The weekly chart still reads the same as last update. The longer price spends below 19.4k, the greater the chances we haven’t bottomed yet. Price is in between major value areas (mountain peaks on the volume profile) which means at any time it could move quickly toward 19k or down to 9-12k. We have a CME gap down low, around 11.2k. On the upside, there’s one near 28k and another near 35k. It’s a big week ahead, as we have PCE inflation numbers as well as a speech from Chairman Powell on Wednesday. The recent Fed minutes release showed that a majority of committee members were leaning toward slowing the pace of rate hikes going forward. Although that’s dovish, the market reaction was rather muted. It’s hard to imagine Powell not holding the line on his hawkish approach, however, as the borrowing rates are set to remain high throughout 2023. I remain cautious therefore on my mid-term outlook.

Daily Timeframe:

We did get a decent bounce on the daily chart off that 73% bull div print on BPRO. That means around 7/10 of the indicators it tracks were diverging at that level, leading to a quick relief move. If able to form a higher low relative to 15.5, it may bounce toward 17.6 in coming days. Until proven otherwise, this is the current daily range. A breakdown could bring further cascading toward 11-13k. As tax loss season gets underway, it’s entirely plausible that selling pressure will persist through the end of the year.

4H Timeframe:

Zooming in on the 4H range, BTC failed to break above the midpoint and trigger further upside toward 17.5k. The level needed to clear is 16.9k. I suspect we’ll test 16240 in the coming hours but price needs to bounce there or we risk heading back toward the lows. There is no trade here. We need to see which scenario plays out first.

BTC/NAS100

This chart continues to break down. BTC’s correlation with stocks is weakening, which naturally means one’s risk portfolio should be weighted more heavily in stocks and cash than in Bitcoin and crypto currently.  

DXY

The dollar index still looks poised to head a little lower, toward 102-104 range, especially if the weekly candle closes below 105.67. On a HTF basis, this simply looks like a retest.

Final thoughts:

All timeframes aside from the intraday chart remain bearish, which means taking sides is not really advised at the moment unless you’re looking to short or play oversold bounces. Personally I’m looking for a possible move into range lows again for some action. However if DXY continues to show weakness, that may drag up the price of BTC. Watch that 16.9k area. Stocks are open for a shortened session today following the Thanksgiving holiday.

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