Bitcoin (BTCUSD) (3-day/8-hour comparison)
Bitcoin had quite the eventful weekend. With a breakout move to $42k on Friday evening, just after legacy markets closed, and another move up $43k early Monday morning. Bulls have come back in force, breaking through these significant levels. Not much volume behind this move, so we still should tread carefully.
When looking at our 3-day chart, we can see price is now within our large range’s orange “neutral” zone, and this is a big step towards recovery. Bulls need to see a high time frame candle close above $44.8k and that would bring possible new highs into play. A rejection from this $42k-$44k zone would give bears control, with next support in the $28k area. On our -hour chart, we are currently nearing the top of a resistance level, the same spot we dropped from in January. This aligns with the 3-day range, with ~$44k being the next level bulls need to break through.
Ethereum (ETHUSD) (3-day/8-hour comparison)
Ethereum is in an almost identical situation on our 3-day and 8-hour charts. On the 3-day range, sitting in the “neutral” zone, and on the 8-hour range, just at th top of resistance. Bulls will need to keep pushing through the $3200s to regain control and give hopes for new highs on the horizon. A rejection from this area would likely have us revisit the July 2021 lows.
Fundamentals & Correlations (Weekly)
BTC dominance (BTC.D) has seen a slight uptick, but still well below 51% to give altcoins some room to move on their own.
The US Dollar Index (DXY) had a retracement last week, which probably gave Bitcoin some assistance on this rally. If the dollar bounces back before Bitcoin and Ethereum reclaim their respective levels for bulls, that could cause some major problems and flatten this impressive rally over the past few days.
