Will we see more accelerated up-moves? - #TradingOutlook Powered by KTG
As mentioned last week, we wanted to see two things:
1. From a bigger picture perspective – a breakout of $27,500, which was expected to open the way for a re-test of ’23 highs.
2. From a short-term / price action perspective – buyers stepping in strongly after consolidations or retracements, leading to accelerated up-moves.
And that’s exactly what was delivered.
We entered last week consolidating after an up-move which started on the previous Thursday on the back of Black Rock applying for spot BTC ETF.
It was also a US holiday on Monday, hence a relatively quiet day.
On Tuesday however, with US markets back up and running, buyers on BTC stepped in aggressively.
It was helped by positive news about DB applying for a digital asset license, and primarily about the launch of EDX crypto exchange by Fidelity, Schwab and Citadel.
BTC posted another leg up, breaking $27,500 which led to further acceleration with more news hitting the wires about more institutions applying for spot BTC ETF.
Eventually on Wednesday, BTC got close to its ’23 high and after a small retracement, started consolidating.
Thursday was the only day since the start of the up-move on June 15th that we didn’t have aggressive buying in the US session, but it was a rest day with sideways trading instead.
After taking a breather, bulls showed up again on Friday, helped by news about Coinbase winning at the Supreme Court and first BTC futures ETF approved by SEC.
The market swiftly pushed through ’23 high of $31,070.
After swiping liquidity above and printing a high around $31,500, we had rejection.
Since then BTC has been very slowly retracing to close the week positive and strong, but still in the range.
BTC has been very strong since the Black Rock news.
This has completely changed the narrative on the market from expected contraction due to SEC’s charges against Binance.
Some are anticipating market expansion with more retail and institutions entering the market if the ETF application gets approved.
New crypto exchange EDX founded by Wall Street giants supports that.
As a result, we have the market moving on expectations of increasing flow coming in the future with more institutions, hedge funds and traders positioning long for that.
It’s visible on the market in how it reacts to the upside (sharp and aggressive moves with liquidity being pulled from offers and shorts squeezed) vs. to the downside (very slow and shallow down moves with lots of absorption from the bid side).
This leads to the pattern of big moves up, consolidations or small retracements and more of the same.
It offers great risk/reward opportunities for trades with strength, especially in US sessions when the most activity and moves happen.
The next couple of days should show us if that buying interest is still there, or something might be changing.
Worth keeping in mind that we’ve faced rejection from ‘23 high so far, and to be confident about longs, we need to see a sustainable break of that high with daily close above.
Before that happens, BTC is still in the range.
Next level from the upside after $31,500 high is $32,500, which if broken should open the way for a much bigger move to $38,000 or even $40,000.
From the downside, it’s important for $29,500 to hold.
If broken, we can get a deeper correction with minor challenges at $29,000 and $28,500 before an important support area at $27,500 - $27,000.
It’s advisable to keep watching how the market reacts to the downside vs upside, and how or if buying and selling pressure is absorbed or not, to get early signs of the next market move.
As always, have a great trading week ahead!
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