Today’s FOMC statement and press conference took center stage as markets try to interpret what it all means for future prices.
In this issue, I discuss my take on where I think the crypto market goes over the next 12 months, as well as some short-term levels to watch.
I share my view on the S&P 500, Bitcoin, Ethereum, MegaWeapon, and Kitty Inu.
Let’s get started!
S&P 500 (SPX500)
The S&P 500 broke below long-term support on January 18th. That triggered an additional 8.5% of downside, which is a decent move for the S&P.
For now, the 4,240 area that I mentioned on Twitter the other day is holding as support. As long as that’s the case, 4,500 is resistance.
A close below 4,240 would open up the 4,000 psychological area, which was a critical factor between February and May of last year.
I maintain the idea that we see one more melt-up from risk assets this year. I know that may sound unlikely given the technical and fundamental environment, but there are actually several avenues as I explain in today’s video.
Bitcoin appears undecided for a second straight day as of writing. BTC started with a nice rally but encountered selling pressure just below $39,000.
It’s no coincidence that the selling started just before today’s FOMC statement and press conference.
For now, it’s a matter of Bitcoin staying above the $35,000 area. Do that, and $40,000-$42,000 is the resistance area to break, followed by $45,000-$46,000.
On the other hand, a daily close below the $35,000 region would open the door to $30,000.
ETH tested a level I’ve mentioned to members all week. The bottom of the November descending channel comes in around $2,680, which served as resistance today.
It was unlikely that the market was going to break this level on the first attempt. Now, it’s a matter of seeing Ethereum stay above $2,200 on a daily closing basis.
Do that, and this range-bound price action continues.
If we see ETHUSDT close below $2,200, the $1,900-$2,000 area is next. Alternatively, a close above the channel bottom near $2,680 would clear the way for a move back to $2,800.
MegaWeapon ($WEAPON) has started to carve out a possible ascending triangle. As many of you know, I bought the WEAPON token in December just above $1. I also added again at $1.40 recently.
With staking coming in the next few weeks and the full play-to-earn game later this quarter, I’d expect a breakout to the upside soon.
In fact, the terminal pattern below suggests a breakout by the third week of February, at the latest. Of course, that doesn’t mean that it will break higher as there are no guarantees.
But with staking and the full game coming in the next couple of months, I’m betting on a bullish breakout toward $10 or more, which would put the market cap at $100 million.
Kitty Inu (KITTYUSD)
Kitty is another play-to-earn token that I was buying last year. I’ve also averaged down a couple of times recently following the weakness from BTC.
The technicals point to a market at support, and also a potential falling wedge.
However, I’m not that interested in the short-term technicals for Kitty Inu as I’m more focused on their Kitty Kart game that launches later this quarter.
The beta release of the game is also slated for early February, which is exciting. I’m certainly looking forward to that.
Another reason I like this project is that they’re hitting all of the hot topics right now. Kitty Kart will be a play-to-earn game, but they’re also targeting AI and the metaverse with their Kitty Inu character.
And that’s worth noting because I think play-to-earn, metaverse, and AI are some of the hottest topics in crypto right now, and I don’t see that changing anytime soon.