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Market Update: November 7th

Quick Take

Direction: We’re currently in one of the tightest ranges BTC has experienced since the bear market of 2014. BTC volatility has plummeted and we’re at the lowest point ever on the .BVOL index since BitMEX started running calculations back in Feb 2017.

 

crypto market update November

 

Bitcoin dominance peaked at about 55% this cycle, and has slowly trended down as select alt coins have been popping off. We’ve seen the addition of two alts, ZRX and BAT to Coinbase, both experiencing 30%+ pops due to the listing. I’d expect similarly positioned alts to perform well, as alt coins generally outperform in times of low BTC vol.

 

 

Bitcoin volume has declined dramatically since it’s December peaks, and over the past two months BTC has sent a decent amount of volume to alt coins as speculators seek higher returns (see: flight to risk-on assets during stable periods).

 

Thanks to coinhills, a great resource!

 

Charting BTC in this range offers little insights, so I am just including the chart to indicate the key levels we need to break on high volume to indicate direction. On balance volume shows that there has been significant accumulation though, which is a bullish indicator. I’m leaning towards a bullish retest of 6500 at this time.

 

 

Key Support: 6320, 6250

Key Resistance: 6410, 6460

Actions: During this time, I would suggest trading alts — or trying to play both sides of the tight range if you are scalping BTC. Special situation/event driven alpha is the best alpha to chase in times of sideways actions.

Playing actions such as suspected listings, main net launches, news announcements and forks will likely be the best way to trade these markets for the next few weeks until volatility returns. I’ll be picking up XLM and ZEC as potential Coinbase additions, as well as accumulating low cap coins which show promising roadmap results, and have market caps below their ICO raises (there are a lot…)

Fear & Greed

Fear and Greed is back! And we’re decidedly neutral, leaning greedy. This is skewed heavily by the long/short ratio and momentum, as strength, breadth and speculation are all fearful. Seeing as momentum is being skewed by the recent ranging, I would consider this an overall bullish indicator.

 

 

This first appeared yesterday in my CryptoAM newsletter where I give out daily market updates.