Crypto Briefing 12/16/22 – The Forecast

Crypto Briefing 12/16/22

Crypto Briefing 12/16/22

As we projected, BTC got rejected at $17,000 and is now moving back down after reaching the peak of its trading range between $15,000 and $17,000. After testing an extreme of a trading range, markets will display inertia, meaning that they will often continue to do what they have been doing.  Consequently, 80% of breakouts in trading ranges or reversals after breakouts fail.  In a broad trading range such as this, there is a tendency for extremes to be tested. Since we saw Bitcoin attempt a bullish breakout of its trading range, there is a high probability that it will retest major support. Depending on how quickly Bitcoin gets to its previous low, there is also the possibility of seeing another leg lower for the entirety of the market. With the crypto winter continuing to rage on, there is always the possibility that more major firms go insolvent.

Aside from Bitcoin’s price action, the tech sector also helps corroborate our thesis that there is the potential for lower prices. For instance, the NASDAQ just formed a wedge top, which is simply three pushes up or down, but always in the same direction. This is a strong reversal pattern, that we have found to be consistently reliable. Should we see some more pain in tech-related equities, then it is likely that Bitcoin’s price will come under pressure.

When it comes to altcoins such as QNT, XRP, and HBAR, they are all following Bitcoin in tandem, which leads us to believe that any large move down on Bitcoin’s part will have a pronounced effect on the altcoin market. We still do not believe this to be the bottom for the altcoin market, and it is our opinion that long-term investors could benefit most importantly from

1. Hold any long-term positions in an offline wallet

2. Maintain a cash position and buy capitulation