Market Direction

"Extreme greed" warning signs flash as Bitcoin eyes $63k

Updated: Aug 31, 2024

Published: Feb 28, 2024

The crypto market continues its relentless climb, with Bitcoin and Ethereum leading the charge.

However, extremely overbought conditions suggest a pullback may be imminent. Solana continues consolidating in a higher range and looks poised for a breakout, while Shadow and Mina remain attractive opportunities that are primed for upside moves.

TLDR

Bitcoin has smashed through the $50Ks even though the funding rates and open interest are at extreme levels.
Ethereum faces limited overhead resistance from here onwards. The key support level sits around $2,640; aggressive buyers can target dips here.
Solana is now a prime opportunity, having ranged between $80-117. A decisive break above $117 should propel prices significantly.
Shadow presents compelling value, having avoided significant gains, with robust support at $1.05-1.20.
Mina appears positioned to continue its uptrend after a backtest of key $1.28 support.

Disclaimer: 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. They are not signals, and they are not financial advice.

Market mechanics

Wow, this market doesn't want to stop. Let's dive into the majors and then look to highlight the best opportunities for now.

Firstly, looking across the board at the mechanics, they're mental. You may be saying, "Yeh, yeh, we've seen this before, and yet prices keep going up".

Now, we can't argue with you on this part, but it is extremely positive (i.e. Funding Rates north of 0.01%); the higher the number, the more extreme the positioning. Funding Rates mean Longs have become the crowded trade.

The last time we saw this post-ETF, we got the flush out from $48k to $38k. It's possible Bitcoin just continues higher now that we have this continued Institutional bid. However, funding does suggest some caution here.

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If we then look at the Open Interest (the amount of leverage), we can see that this is also massive for BTC and ETH and has increased dramatically in the last few days.

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BTC

Looking at BTC on the 3D chart, we can see that we have smashed through all resistances with just the $63,300 and then the all-time high as the next resistances before we enter price discovery.
BTC is in a really clean local uptrend with its yellow box in the late $40Ks. It’s hard to see how that now fills, particularly with the Institutional bid we've seen.
To the downside, we'd expect the horizontal level of $52k/$53k to hold as strong support.
The RSI is very overbought on all major timeframes. You would expect this to reset at some point, but price may go higher first.

Cryptonary's take

Price has been driven by what seems to be this infinite bid from Institutions.

Now, we still believe that we're relatively early, so we're not looking to sell BTC here. Still, when you look at the chart, it's hard to imagine that this just continues, particularly in the short term; a pullback may be expected, especially when looking at the mechanics.

We would be a strong buyer of pullbacks if BTC were to see a 20% or so pullback.

ETH

Again, looking at ETH on the 3D timeframe, it is another that's seen a really strong bid over the past few weeks. To the upside, the horizontal resistances are at $3,525 and $3,970 and then all-time highs.
The new yellow box sits just above the $2,640 horizontal support, so if price were to retest as low as that, that would likely be a good long-term buying opportunity. The yellow box positioning is due to change if ETH puts in a new high from the current high.
Once again, ETH's RSI is really overbought on all major timeframes, so it’s a reason to be cautious. Not to sell, but at least not to pile into fresh leverage.

Cryptonary's take

ETH had some catching up to do, and it has certainly done that.

We would look to add to our ETH bags on any major pullback. The first key area of interest looks to be the horizontal support of $2,640. Pullbacks, if they come (which they likely will; nothing can just keep climbing), will most likely be quickly bought up, so it's key here to have buy orders placed at key levels. That level for us is in and around the $2,640 level.

SOL

Looking at SOL on the 3D timeframe also, we can see that it's holding in this higher consolidatory range that we called for a number of weeks ago, between $80 and $117.
A breakout above $117 would likely see price move up to $131 and then $150. If price can break above $150, the next target would be the all-time high before price discovery.
SOL's RSI has reset more substantially, particularly compared to other majors (such as BTC and ETH).
On the downside, there is a large layer of support between $86 and $97. If price were to fall back to this level, it would likely be a great long-term buying opportunity.

Cryptonary's take

SOL has led on the way up, and its price has consolidated for the past month or two, while BTC and ETH have led more major moves of their own.

As BTC and ETH potentially begin to consolidate at these higher prices, SOL may lead the next major leg higher. Therefore, at $112, SOL still seems relatively attractively priced. But if SOL were to pull back, we'd add to our SOL bags more aggressively. We still see SOL as a huge winner of this cycle, with price targets north of $500 and even potentially higher than $500.

SHDW

As opportunities go, SHDW still looks attractive as it is yet to make a meaningful move higher.
SHDW remains range-bound between $1.05 and $1.40.
The RSI is at a middle level, so there are no signs of over-exhaustion that might worry us for possible upside.

Cryptonary's take

Therefore, when scouring the market, if we were looking to increase exposure to ALTS, SHDW stands out as it's yet to make a major move while its market cap remains below $200M. This has a lot of potential still. Therefore, we would look to continually add orders between $1.05 to $1.20 - an upping of our DCA range - to continually build a position in SHDW for the long term, with upside price targets being significantly higher.

MINA

While looking at MINA on the 3D timeframe, this seems primed for a higher move.
MINA is holding a steady uptrend, whilst it has also found support and bounced from its main yellow box between $0.99 and $1.06, and price now seems to be settling above the prior horizontal resistance of $1.28, potentially turning it into a new support.
The overhead resistances are at $1.73 and then $2.10.
MINA is currently on top of a support level of $1.28, which also converges with the uptrend line, so it should act as a good level of support.
When looking at the RSI, this is in a middle territory, so it is healthy and can help aid price to go higher.

Cryptonary's take

If you're looking for more exposure to the market or looking to increase your ALTS exposure, then MINA may be a good play here. Price is consolidating at a higher price point, and looks good to push onto $1.73. The current price is potentially a good entry if you look at this play from a longer-term viewpoint.