Market Update:

Bitcoin has continued to keep the market guessing as it weighs heavy at the bottom of its 3-week range between $30,000 – $36,000.  

On the Daily chart, the Moonraker indicator is showing that we are currently trending down, having offered a near-term short trade opportunity since pushing away from the mean line.  The next major support levels are at $29,000 – $30,000.  Should price break below there, supports are at $24,500 and $22,000.

Bulls need to see price reclaim the volume point of control currently at $35,600, but will then face resistance soon after at $38,100.

Figure 1: Moonraker indicator highlighting key support and resistance levels for Bitcoin.

You can purchase Moonraker indicator here.

Cross Timeframe

Cross timeframes are all bearish currently on both Predator and Terminator indicators showing how weak recent price action has been.  The one exception is the 1hr chart as price tries to bounce at the time of writing.  Currently, there is limited evidence of strong buying volume in the market with the 4hr, 12hr, Daily, 3 Day, and Weekly all signalling a bearish trend.

Figure 2: Predator currently bearish across majority of timeframes

Sentiment

This lack of buying in recent weeks is spooking the market as can be seen by the sustained ‘Fear’ scores in the Crypto Fear and Greed Index.

Figure 3: Crypto Fear and Greed Index

This tends to be a lagging indicator and is likely to remain in the ‘fear’ zone until strong buying volume returns.

Miners Bounce Back

From a network perspective, things are starting to look brighter following the major drop in hash rate three weeks ago. The drop in hash rate was largely driven by miners who were forced to move from China after the government banned Bitcoin mining there.

This triggered a major drop in the difficulty adjustment two weeks ago. Since then, hash rate is making a solid recovery.  Suggesting that more miners are coming back onto the network –  whether those are less efficient ones now able to mine following the difficulty adjustment drop, or miners having already relocated from China coming back online.

Figure 4: Early signs of recovery for hash rate following the recent drop.

This reduces the need for miners to potentially sell more bitcoin they hold to cover costs. Therefore resulting in potentially less overall $BTC sell pressure (and market-perceived sell pressure risk). 

The Puell Multiple looks at the daily issuance of bitcoin (in USD) relative to historical norms to give a sense as to whether miners are generating strong revenue or not at a particular moment in time.  Historically, the price has bottomed broadly around periods when the Puell multiple enters the green zone, and tops when it enters the upper red zone.

Figure 5: Puell Multiple is currently in the middle of its range.

After a recent drop into the green zone, the Puell multiple indicator is currently at a healthy level in the middle of its range as miner revenues have increased following the recent difficulty adjustments.  If hash rate continues to climb as more miners come back online, this should limit any near term risk of major selling from miners.  

Predator Hunts Out Opportunity In NFT Gaming

While much of the market has gone sideways or down the past few weeks, one Crypto sector has been booming – NFT gaming.  The charge has been led by Axie Infinity (AXS) after showing parabolic user growth.  This led to a surge in interest in Axie and also other NFT gaming projects including Sand ($SAND), Alice ($ALICE) and Small Love Potion ($SLP)…which is a specific token within the Axie economy.

Figure 6: Predator indicator identifying the recent opportunity in NFT Gaming.

You can purchase Predator Indicator here.

Predator indicator turned green to signal the upside trend opportunity on each of these projects. Following their huge price increases over the past two weeks it is now signalling that caution should be advised today on $SAND, $ALICE, and $SLP as the current daily candle on those projects is turning amber.

We will need to wait for the current daily candle to close to confirm this potential change in trend. That will help identify whether these NFT gaming projects need to pull back, or whether their uptrend can continue going into the weekend.

Speak Soon.

Disclaimer: Nothing within this article should be misconstrued as financial advice. The financial techniques described herein are for educational purposes only. Any financial positions you take on the market are at your own risk and own reward. If you need financial advice or further advice in general, it is recommended that you identify a relevantly qualified individual in your Jurisdiction who can advise you accordingly.