📝 Video Summary
Overall Market Evaluation by Josh
Josh's overall evaluation of the market is predominantly bearish in the long term. He highlights that Bitcoin and the broader crypto market are highly correlated with the US stock market, which is currently experiencing a short-term dump. While there might be short-term bounces or sideways consolidation, Josh emphasizes that the larger multi-month bearish trend for Bitcoin and Ethereum remains intact. He advises understanding the difference between short-term price action and the overarching long-term trend. For XRP, the situation is critical, with the asset testing crucial support levels, and a break below could lead to significantly lower prices. For altcoins like Solana and Chainlink, the long-term trend is also bearish, but they are retesting key support levels, with potential for significant downside if these levels break.
Key Points and Main Topics Discussed
- US Stock Market Correlation: The US stock market, particularly the S&P 500, is currently dumping in the short term, which is directly impacting Bitcoin and the broader crypto market due to their high correlation.
- Bitcoin's Long-Term Bearish Trend: On the weekly timeframe, Bitcoin remains in a bearish trend, indicated by the super trend indicator in red and ongoing bearish divergence since all-time highs.
- Bitcoin's Short-Term Outlook:
- Bitcoin is currently experiencing a short-term dump, influenced by the stock market.
- The 3-day Bitcoin RSI is approaching oversold territory, suggesting a potential bounce soon, but more downside is possible.
- Key support levels for Bitcoin are around $63,000 (local low) and $60,000 (psychological and local low). Below $60,000, support is expected between $53,000 to $56,000.
- Resistance is observed around $72,000.
- On the 2-hour chart, a potential bullish divergence might be forming if Bitcoin makes a lower low while the RSI makes a higher low. This is not confirmed yet but could signal a short-term relief rally over a couple of days.
- Liquidity has been wiped out around $65,000 and $64.1K, with upside liquidity at $68.7K.
- Josh anticipates another local low forming soon, followed by a slight relief rally within the next couple of days.
- The 3-day RSI suggests potential sideways consolidation for another week or two before a potential further leg down in the long-term bearish trend.
- Ethereum's Bearish Pattern: Ethereum has confirmed a break towards the downside from a bearish price pattern (descending triangle), activating a new bearish price target.
- Ethereum's Short-Term Outlook:
- The descending triangle pattern has a technical price target around $1730-$1740.
- Key support is around $1810-$1820 (Fibonacci level and previous local low). A break below this with confirmation could lead to a move towards $1500-$1600.
- A retest and rejection of support around $1920 has occurred, confirming the bearish pattern.
- A potential bullish divergence might be forming on the 8-hour timeframe if the price makes a new low while the RSI makes higher lows, but this is not yet confirmed.
- The longer-term trend for Ethereum remains bearish despite short-term relief.
- XRP's Critical Support: XRP is at a crucial support area between $1.30 to $1.40. A break below $1.30 with confirmation could lead to a drop to $1.13, and further breakdown to the $0.90-$1.00 range.
- Bitcoin Dominance: Bitcoin dominance is showing choppy sideways action, indicating that altcoins will likely perform similarly to Bitcoin.
- Solana's Support Level: Solana is testing crucial support between $75 to $80. A confirmed break below $75 could lead to a move towards $50, with significant support between $45-$50.
- Chainlink's Support Level: Chainlink is retesting support between $7.90 to $8.50. A break below $7.90 could lead to a drop to $5-$5.50, with potential short-term support around $7-$7.20.
- Opportunities in Bear Markets: Josh emphasizes that bearish price action presents opportunities, especially for those who know how to trade short positions to profit from downward movements. He believes the worse things get, the better the opportunities become for those equipped to handle them.
Important Insights
- The correlation between the crypto market and the US stock market is a significant factor influencing short-term price movements.
- It's crucial to distinguish between short-term price fluctuations and the overarching long-term bearish trend in cryptocurrencies.
- Oversold signals on indicators like RSI are not necessarily bottom signals but can indicate a need for consolidation or a reset, allowing for further downside.
- Bearish price patterns like descending triangles have a higher probability of breaking to the downside.
- Liquidity levels are important to monitor as they can influence price action.
- Even in a bearish market, there are opportunities to profit through short selling.
- For altcoins, monitoring Bitcoin's price action is a good indicator of their likely movements.
Trading Opportunities and Positions
- Potential Short-Term Bitcoin Bounce: Josh anticipates a possible formation of a bullish divergence on the 2-hour Bitcoin chart. If Bitcoin makes a new lower low in price while the 2-hour RSI forms a higher low, this could signal a short-term relief rally over the next couple of days.
- Ethereum Descending Triangle Target: The descending triangle pattern on Ethereum has a confirmed bearish price target of approximately $1730-$1740.
- XRP Breakdown Targets: If XRP breaks below $1.30, potential targets are $1.13 and then the $0.90-$1.00 range.
- Solana Breakdown Target: A confirmed break below $75 for Solana could lead to a move towards $50, with significant support between $45-$50. Josh points out that this represents a potential 33% move downwards, which could translate to over 300% profit on a 10x leveraged short position (not financial advice).
- Chainlink Breakdown Target: If Chainlink breaks below $7.90, the next significant support is between $5-$5.50.
Alerts to be Aware Of
- BTCUSDT;{{price}} < 60000;Josh: Watch for a break below $60,000. Next support area is $53,000-$56,000.
- BTCUSDT;{{price}} < 63000;Josh: Watch for a break below the local low around $63,000.
- BTCUSDT;{{price}} > 68700;Josh: Watch for upside liquidity at $68.7K.
- ETHUSDT;{{price}} < 1810;Josh: Watch for a break below $1810-$1820 support. Next target $1500-$1600.
- ETHUSDT;{{price}} < 1730;Josh: Descending triangle target at $1730-$1740.
- XRPUSDT;{{price}} < 130;Josh: Watch for a break below $1.30. Next target $1.13, then $0.90-$1.00.
- SOLUSDT;{{price}} < 75;Josh: Watch for a break below $75. Next target $50, with support at $45-$50.
- LINKUSDT;{{price}} < 790;Josh: Watch for a break below $7.90. Next target $5-$5.50.