It’s complicated in the crypto market. Not only is crypto a hyper bi-furcated market as predicted in our 2022 crypto predictions it’s also now seeing breakdowns in the strongest segment of them all (NFT tokens). While all this sounds complicated, which it is to some extent, there is also a very simply way to look at the crypto market and trends in there: the BTC chart.
As an illustration of ‘being hit hard’ we did select the Axie Infinity chart. This was once the darling of the market. A few days ago, it did breach what we marked as the ‘red line’. The chart says it all. After a violent decline of 82% it looks like the bottom is not in yet. How low does this have to fall until the bleeding ends? We don’t know, all we do know is that investors better don’t try to ‘catch a falling knife’ and wait for a double bottom or V-shaped type reversal.
The next chart comes from the crypto weekend alert which will be sent on Sunday to premium members in our crypto investing research service. From time to time we tend to feature one of the charts we share with premium members, this one of them.
The 16 month BTC chart is very complicated, but essentially it is also simple (provided you have the skills to create simplicity out of complexity).
The one and only thing that matters, currently, is the test of a rising trendline which is shown in green. This trendline marked the lows of the January and February sell-offs. Since then, BTC did not sell off significantly, it only had a steady decline since April 5th.
Currently, there is even a combination of 2 dominant trendlines that are being tested: the green rising and red falling. When explaining this to our members we tend to use the term ‘friction’ or ‘high tension’. You can see how multiple ‘events’ coincide in this current price range. It’s not easy to make a decision because there are conflicting trends.
We believe it is wise to be cautious here. No aggressive trades nor positions should be opened because if BTC violates the current level we see it re-testing 33.3k (eventually, potentially, 29.1k).
The next few days and weeks will be important for BTC and the entire crypto market. We constantly look for the unicorns which show relative strength but also might be the next winner(s) in the next big trend. Our best bet is GameFi, and we have made our selection of tokens that we want to track for 2022!
