Crypto just went through the largest forced liquidation in it's history. The sheer brazen negativity is palpable. Last time, I told you I had some next gen hopium. Here is your purple palm tree delight.
Obligatory: this is not financial advice and I am not a financial advisor.
S&P
While others are looking at smaller time frames I like to look at macro time frames. A new monthly candle just closed and it actually looks decent. Monthly candles closed above the VWAP and nearly formed a bullish engulfing candle. A tweezer bottom also formed which is one of my favorite patterns for potential reversals.
VIX
The VIX broke down from the triangle it had been in for the past 5 months. It's trending downwards. We want to see it continue trending downward if we want market sentiment back to bull.
DXY
One chart that I really like right now is the monthly that just closed on the DXY. If you want markets to go up, you want to see dollar weakness. A strong dollar means that you want to hoard it and not spend it. A weakening dollar means you want to get rid of it and invest it into assets that will outperform the dollar.
BTC
Bitcoin is showing a change of character in it's price action and volume right now. It's still mostly coupled to the traditional markets but there are cracks in the chain beginning to show. At first glance you may say that we're about to play out a fractal of May/June but there are important key differences between then and now. The price action is objectively more bullish as it's making higher lows and higher highs. We are much closer to the cloud this time which can trigger an end-to-end move back to 33k. And last but not least there is a massive swell of volume this time ruling out a possible macro bear flag. Honestly this looks like an accumulation trading range that just broke into an upper range.
DCR
Decred didn't pop up along with the "blue chips" but it's set up as a dark horse, as usual. It broke above the macro resistance zone of $26-27 and looks like it's coming back to test it as a support level, if it holds.
If the test holds then there's a good chance we see ~$53 as well as flipping the cloud back to bull.
Decred hopium pitchfork 2.0
Last time, I told you I had some next gen hopium. Here is your purple palm tree delight.
Conclusion
Crypto just went through the largest forced liquidation in it's history. The sheer brazen negativity is palpable. I bought $17,800 and I still believe that was THE bottom of this cycle. If you're not here for NGU then what the fuck are you still doing here?
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