Issue #20 | Flirting With Death
A deep dive into Bitcoin’s impending Death Cross, a closer look at FTX coins, and a must-see BTC versus S&P500 chart.
Issue #20 of CoinChartist (VIP) overview
An issue dedicated to the Death Cross
Bitcoin holds a crucial level, but challenges are ahead
Altcoin outlook worsens as FTX prepares to liquidate SOL, ETH, APT, DOGE, and MATIC
BTC correlations with the Dollar and Gold
A must-see S&P 500 versus Bitcoin chart
Wave counts and Fibonacci targets for Solana and Bitcoin
A Chart Class lesson on the the effectiveness of trading and investing using Moving Averages
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Bitcoin should close its third week in a row at just around $26,000, after being rejected from the seemingly everlasting ranging above $29,000. Will it recover and rally higher, confirming a head fake setup discussed in previous issues? Or will all of crypto succumb to another round of FTX-related carnage?
The ongoing downward price action in BTCUSD will trigger a Death Cross next week, right around the time FTX crypto holdings could be liquidated. As much as $268M in Bitcoin could be sold into an already fragile market. Because the Death Cross signal could be an important bearish narrative, paid subscribers will get a detailed deep dive into the Death Cross and what it could mean. The premium content will include the results of using a 50 & 200 day Moving Average crossover trading strategy and a comparison between three different Bitcoin charts that could indicate the approaching Death Cross is a fake. If it isn’t, crypto is flirting with death, as we’ll also explore throughout this issue.
Even the TD Sequential is telling us the conclusion is coming this week. The market timing tool from Thomas DeMark has given a perfected TD8 buy setup. The TD9 will trigger once the new week opens. Bitcoin must reverse based on the count or risk reentering a downtrend.
Bulls have prevented a breakdown below or tag of the lower Bollinger Bands. This is notable and still supports a possible bullish head fake scenario. Closing below the lower band is a sell signal, while a close above the upper band is a buy signal.
Bitcoin lost the Bollinger Band basis on the weekly timeframe, but it is still holding above the 20-period Simple Moving Average. It is critical that this level holds, or selling could resume and ramp up.
Coincidentally, the level has confluence with the Ichimoku Cloud. Price action is passing just below the bottom of the Cloud. A weekly open above $26,000 would put Bitcoin back in the cloud.
Interestingly, there is confluence with the daily Ichimoku Cloud as well. BTC CME has held 21 days above the bottom of the Cloud.
Next week, FTX’s remaining crypto holdings could start to be liquidated on the open market. The holdings include $268M in BTC, but much more in altcoins, especially SOL. As such, we are looking at a handful of the alts that could be affected
Solana eerily continues to follow Ethereum circa the 2018 bear market, and would be approaching a possible lower low, right before the coin takes off all over again. FTX apparently could hold as much as $685M in SOL.
That said, without the Ethereum comparison, SOL looks to be forming a massive Head and Shoulders pattern. Momentum has started to cross down below the zero line on the LMACD. The tool must diverge upward and uncross the bearish crossover, or else momentum could drag prices much lower and trigger a breakdown of the pattern. Later, in the Wave Watch section, I provide a possible downside target.
Dogecoin is also on the list of potential tokens held by FTX, to the tune of $42M. This isn’t anywhere as substantial as SOL, or even BTC holdings, making the sell pressure possibly negligible. However, a broader cryptocurrency market sell off driven by SOL and BTC could take DOGE down with it. Momentum doesn’t say much in DOGEUSD, other than helping highlight the ongoing chop.
MATIC, meanwhile, demonstrates momentum turning down further. FTX potential holds $39M of the token.
Aptos has among the ugliest charts of the FTX altcoins, with momentum turning down below the LMACD zero line. Price never took out the November 2022 low, and very well could during a larger market sell off. FTX holds only $67M of APT
A massive Rising Wedge / Ending Diagonal in Ethereum could break down if the crypto market does capitulate. Weekly momentum is pointing down. One look at this should indicate the potential severity if this goes bad. Therefore, bouncing this week on positive news is critical for crypto avoiding a larger crash.
That’s it for free content. The best content is always reserved for premium members and Founding Member VIPs.
Behind the paywall is a deep dive into the Bitcoin Death Cross and look at the signal’s reliability and an education lesson on how to use the signal to trade.
There is also a can’t-miss S&P 500 versus Bitcoin chart, and a variety of macro correlations with crypto.
Finally, a Chart Class lesson on the the effectiveness of trading and investing using Moving Averages.
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