We are probably just expecting prices to stay high now, but the markets are also cautious due to the Inflation data and the Fed Meeting next Wednesday.
Once we're on the other side of those, we should have more clarity on where officials stand, and the market and ourselves will work it out more from there.
- Markets will likely remain cautious ahead of next week's Inflation data and Fed Meeting.
- BTC sold off slightly after stronger-than-expected jobs data, but the price remains in an uptrend above the key $68,900 level. A breakout above $72k is needed for further upside.
- ETH is trading in a tight range with the potential for a short-term pullback due to market caution. ETF flows are expected to be positive for ETH in the mid- and long-term.
- SOL is also rangebound for now, a breakout would require favourable Inflation data and dovish Fed guidance.
Disclaimer: This is not financial or investment advice. You are responsible for any capital-related decisions you make, and only you are accountable for the results. "One Glance" by Cryptonary sometimes uses the RR trading tool to help you quickly understand our analysis. These are not signals, and they are not financial advice.
BTC
Having had the labour market data out just a few hours ago, we got a slightly higher Unemployment Rate (ticked up to 4.0% from 3.9%), whilst the number of Jobs added in the US came in much stronger than anticipated (272k against a 180k consensus).On the surface, this doesn't look like a good read because the Unemployment Rate ticked higher and wages also ticked higher, meaning Fed interest rate cuts were priced out. But, 272k jobs added means the Labour Market is still relatively robust for now, and therefore, that should support corporate revenues and profits which should be good for risk assets (Equities).
So far, Bitcoin has sold off slightly following the print.
- The Funding Rate for BTC is at 0.01% meaning there is an even balance currently between Longs and Shorts.
- Bitcoin's Open Interest has increased to new highs this cycle, to $37.7b. The Open Interest has increased steadily, though, and the Short Interest that has been built up may be funds buying the ETF and shorting the Futures product, therefore picking up the carry of the Funding Rate as essentially risk-free profit. This is something to take note of.
Technical analysis
- Price has maintained its local uptrend and is now comfortably above the key horizontal level of $68,900.
- If price were to pull back, you'd ideally want to see the horizontal level of $68,900 act as new support.
- The RSI has climbed slightly higher to 62 but is not yet in overbought territory.
Cryptonary's take
If the data had come in today more in line with consensus, I believe we would have seen a breakout for BTC.Unfortunately, it didn't. Price, however, has done well to climb back into the $71k. A breakout would come with a clean move above $72k.
However, prices may remain choppy at these higher levels as the market prices out rate cuts (due to today's hotter labour market data). The market will now likely be cautious going into next week's Inflation data and Fed meeting on Wednesday.
We remain very constructive on BTC and see a breakout to the upside as more likely in the short term than a breakdown. If we do get a breakdown, the key level to hold above will be $67,200. For now, we're not taking any action on BTC, particularly with our Spot bags. We're remaining patient.
ETH
- ETH's Open Interest remains at its highest level since the news that the ETF would be approved.
- ETH's Funding Rate has picked up over the past few days, now climbing up to 0.018%.
- With Open Interest at highs and Funding Rates climbing, this suggests that Longs are becoming more overweight against Shorts. For now, this is fine, but if Funding were to go north of 0.03% or 0.04%, that's when you'd be worried that Longs may become vulnerable to a squeeze and the market potentially flushes lower. For now, it's fine. But it's just something to be wary of.
Technical analysis
- ETH remains beneath its major horizontal resistance of $3,967.
- There is a local horizontal support at $3,645, with a more major horizontal support at $3,485.
- Price is currently in a very tight range, mostly between $3,700 and $3,900, while in a pennant formation. These tend to break to the upside; however, a wider market move may determine this pennant's price action (e.g., BTC moves).
- The RSI is coming off of overbought territory on the Daily timeframe and has pulled back to 61, although larger timeframes, such as the Weekly, are close to overbought territory.
Cryptonary's take
In the mid-and long-term, we're bullish on ETH because we see ETF flows as likely to be quite positive.In the short term, however, we may see a slight pullback, particularly if risk assets are cautious ahead of next week's Inflation data and the Fed Meeting.
Therefore, we continue to hold Spot and will look to add to ETH bags on any major pullback. That would be anything under $3,600. A break above $4,000 would trigger the full bull reversal.
SOL
- SOL's Funding Rate is 0.018% (the same as ETH currently), meaning traders are slightly biased toward Long positions rather than Short positions. However, 0.018% is not dramatically overweight, so Longs and Shorts are still relatively balanced.
- SOL's Open Interest is still 15% below the highs we saw back in March. Therefore, this signals a relatively healthy leverage market for SOL at the moment, which is positive for price action as it reduces the chances of a more significant leverage flush out, which you usually get with high Open Interest and extreme (one way or the other) Funding Rates.
Technical analysis
- SOL is still out of its uptrend line, and price has moved up and rejected off the underside of the uptrend line.
- SOL is now battling in quite a tight range (similar to BTC and ETH), with horizontal support of $162 and resistance of $170 to $173.
- SOL will likely struggle for a more significant upside in the short term while remaining beneath its uptrend line. This may mean we need to see a slight pullback and test of support at $162 to fuel another move higher.
- Beneath $162, the next major support is $152.
- To the upside, a more substantial breakout comes with a move above $190 and then $205. Although we don't expect this anytime soon, at least not in the short-term, unless Inflation data is favourable next week and Powell is dovish in his rate cut guidance.
- The RSI is in the middle territory on all major timeframes, meaning it shouldn't act as a headwind for price action. However, that doesn't also mean it's supportive of price action. It is non-directional.
Cryptonary's take
Of course, in the mid-and long-term, we're extremely positive on SOL, but for now, we remain patient while price action is likely rangebound and in that tighter range we've identified above. However, we will remain responsive to any more meaningful move down to add further to our SOL Spot bags—this looks like anything below $150.Recommended from Cryptonary
