What does Bitcoin need to do to break out this week? Also, what’s the outlook for the rest of December?
We’ll discuss that and more in today’s issue.
Plus, updates on ETH, ADA, XTZ, MATIC, kitty, and WEAPON.
Let’s get it!
Thoughts on the Overall Crypto Market
Since the big liquidation event over the weekend, we’ve seen mostly consolidation from the larger cap cryptos. That’s especially true for Bitcoin.
I expect more of the same throughout December.
But it’s important to keep in mind that because of the December 4th candle, we’re dealing with a fairly massive range for Bitcoin.
Anything between $42,000 and $53,000 is fair game. That said, the April trend line moves that support level up to about $46,000.
Still, lots of wiggle room for the market.
A price below $50,000 through the end of 2021 plays into max pain theory in that all of the options contracts with strikes above $50,000 would expire worthless.
Perhaps after all that we get a breakout in January as new institutional money gets approved to enter crypto.
Only a close back above $53,000 would change my mind.
Another factor I’m paying attention to is the volume or lack thereof. This has been a point of contention for months.
If we’re to see Bitcoin and the rest of the crypto market breakout later this month or even January, we need to see volume to match the price increase.
Without volume, any rally or even breakout is more likely to fail.
Bitcoin is crawling higher this week after a massive liquidation event over the weekend. So far, it’s been an impressive recovery.
However, BTCUSDT needs to get back above $53,000 on a daily closing basis. Until then, this is just a relief rally.
As I’ve mentioned on Twitter recently, I expect more consolidation in December after testing $53,000. Only a daily close above that will change my mind.
Key support is $49,000. Below that is the April trend line near $46,000.
ETH has played out perfectly over the last 24 hours. I told Cryptocademy members about $4,200 support yesterday, and that’s right where the market bounced.
We’ve also been watching the short-term trend line off of the recent high, which was broken earlier today.
That could open the door to higher levels like $4,600. Just keep in mind that it depends on what BTC does if it reaches the $53,000 resistance area.
Cardano has reached an interesting place on the chart. There’s a confluence of support near $1.35 that’s currently holding on a daily closing basis.
We’ll see if that continues. As we all know, it’ll likely depend on whether or not Bitcoin can get back above $53,000.
A close above $1.50 would signal strength and expose $1.70 while a close below the $1.35 area would suggest further downside.
XTZ is attempting a breakout this week back above $5.60. That’s the area that needs to hold as support on a daily closing basis.
One thing I like here is the volume. It’s been relatively high over the last two days. That’s a positive sign when combined with a bullish reversal.
Get above and stay above $5.60, and we should see XTZ run toward $6.50 resistance. Above that is $7.30.
Just keep in mind that this entire idea relies on staying above the $5.60 handle.
MATIC has had a nice bounce from support in the $1.70 region. It’s also closed above $2.20, which is currently serving as support.
However, buyers have to get above $2.70 on a daily closing basis to confirm the breakout. That’s the all-time high and a trend line from the August high.
Get above $2.70 and we could see MATIC extend higher toward $4.50. Alternatively, a close below $2.20 would suggest a return to $1.80.
Kitty Inu (KITTYUSD)
Now for a couple more speculative plays. Kitty is a play-to-earn (P2E) token that I started buying in late October.
Since then, the market has mostly consolidated above my entry. However, the team continues to expand its marketing reach and develop its P2E “Kitty Kart” racing game. The beta launch is slated for January 2022.
So although the chart looks rather boring now, I expect that to change as we get closer to the launch of their game.
It’s available on Uniswap and now PancakeSwap as of yesterday.
As always, this is not financial advice. Be sure to do your homework before buying.
MegaWeapon is another P2E game that I mentioned on Twitter last week. I’ve been accumulating just above $1 as that’s about a $10-$12 million market cap.
I think that’s a decent price for a token with experienced developers behind it, staking coming later this month, and a battle arena style game coming in Q1 2022.
Not financial advice. Please do your homework if you’re going to buy.