The crypto market is struggling to find its footing.
Bitcoin and Ethereum are up nicely from their recent correction lows on February 28th, but the selling isn’t over.
In today’s newsletter, we’re going to take a look at why Bitcoin dumps, including one group that, in my opinion, is responsible for much of it.
We’ll discuss warning signs to look for and review some charts.
Let’s get it!
Crypto Market Cap
The total crypto market cap continues to consolidate following the most recent correction that began on February 22nd.
Despite being up 13% from the February 28th low, there’s a chance the market isn’t done consolidating.
That doesn’t necessarily mean we see new lows, though.
Notice the consolidation in January that helped carve this ascending channel.
As of now, the crypto market cap hasn’t fully retested channel support.
That makes me think we could see one more pullback before the uptrend is ready to resume.
BTC (Bitcoin) sold off from the $49,000 support area hours ago.
I mentioned how a breakdown seemed likely on Twitter.
As of now, $47,500 is serving as support.
A close below that area could open the door to the region between $43,000 and $45,000.
Alternatively, BTCUSDT would need to close back inside of this ascending channel to reverse the downward pressure.
That would mean taking out the recent 4-hour highs near $50,000.
I think that Bitcoin needs one more pullback to $45,000, if not $43,000, before the next leg higher can materialize.
Similar to Bitcoin, ETH (Ethereum) has a decision to make.
The daily time frame shows how Ethereum is ranging between $1,400 support and $1,650 resistance.
The latter is the 50% retracement of last month’s range.
You can also see where the midpoint of the ascending channel below has played a role over the last few months.
That could be something to keep an eye on over the coming sessions.
If ETHUSDT closes a day below $1,400, we could be looking at a $1,300 or even $1,200 ETH this month.
At the other end, it’s going to take a daily close above $1,650 to re-expose the $1,800 region.
VET (VeChain) has broken back inside of its previous $0.045 – $0.06 range.
This was the consolidation area throughout much of February.
As long as the $0.045 area holds as support, VET will look constructive, and all eyes will be on the crypto’s all-time high at $0.06.
A failure to hold above $0.045 would see another go at the $0.035 to $0.045 range.
AAVE has been one of the best performing cryptos over the last few months.
Since the November low, AAVE is up an incredible 1,470%.
At its February high, the crypto was up 2,150% in just three months.
I expect these outsized gains to continue.
That’s especially true when you consider the market’s recent 51% pullback.
Additionally, the bull flag pattern below hints at a turn higher over the coming weeks.
Targets of $750 and even $1,000 by May/June are not outlandish, in my opinion.
ADA (Cardano) has had an incredible run since December.
The crypto is up an impressive 1,000% since December 23rd.
Not only that, but every dip is getting bought up in a hurry.
To that end, ADA hasn’t had much chance to correct with the rest of the crypto market.
That can be a blessing and a curse.
On the one hand, it signals strength.
And on the other, it can produce an outsized pullback under the right circumstances.
With that said, it’s pretty clear from the chart that pullbacks are buying opportunities.
Anything between $0.70 and $0.90 would be an incredible buying opportunity, in my opinion.
Sellers have to get past $0.97 support first, though.