The positive momentum in the crypto markets is now being shadowed by a cross of two significant moving average lines.

A death cross occurs when the MA-50 crosses below the MA-200 line. This time, the cross was between the MA-100 crossing below the MA-200 line.

Reviewing the historical incidents where this cross took place, the market has reacted negatively last time, causing a 15% correction in June – July 2021 following the previous incident of a death cross.

Technical Analysis

By: Edris

Long-Term – The Daily

Bitcoin has been moving upwards in the past few days. The positive signaling point is that the BTC price has already broken above the major descending trendline and shortly attempting at the 50-days MA resistance line.

However, the negative point to highlight here is that the 100-days MA crossed below the 200-days MA. The last time this cross happened was at the final phase of the mid-2021 heavy correction. The price declined more than 15% back then – below $30K, finalizing the last bearish leg before a significant rally that ended at November’s Bitcoin ATH of $69K.

Short-Term – 4-Hour

On the 4-hour timeframe, it is evident that the price is currently being rejected at the $45k resistance area. Moreover, the RSI indicator shows that bitcoin has been “overbought” in the 4-hour timeframe, and a correction may be imminent.

From a technical perspective, there is a high chance for the price to experience a correction to the $39k range, completing the first-major pullback after breaking the major bearish trendline.

However, one should observe the price action, as a deeper correction to the $33k range (January’s lows) is feasible, especially with the daily MA100/200 cross.

Onchain Analysis

By: Shayan

The NVT Ratio (Network Value to Transactions) illustrates the relation between market capitalization and transfer volume. It’s similar to the PE (Price to Earnings) ratio utilized in equities markets.

NVT is a metric that determines whether or not Bitcoin’s blockchain network is overvalued.

Historically, when the price dropped below the 90-day and the 28-day MA NVT price, it was an excellent opportunity to follow the DCA strategy to accumulate Bitcoin.

Currently, the price is below both NVT prices indicating the network is undervalued and is considered an ideal time to start a DCA accumulation. Moreover, a day trader can start realizing the profits whenever the price breaks above the NVT prices.

The recent spike in bitcoin’s price left many market participants in a well-known phase called “Disbelief.” Many technical analysts were waiting for the RSI indicator and price trend to break above the long-lasting resistance line that was formed in the daily time frame. Here, this break out is investigated from both technical and onchian perspectives.

Technical Analysis

By: Shayan

Long-Term

Bitcoin had been stuck below an important resistance trendline (blue line) for a couple of months. Eventually, it broke above it with a strong green candle and spiked almost 11% in a single day.

On the other hand, BTC broke the resistance RSI trendline simultaneously and formed a nice pattern to confirm the breakout. Currently, the price is below the 100D MA, which is critical resistance, and it is possible to reject the price from the $42.5K level.

Regardless, Bitcoin needs to form a higher high above $44.4K daily to confirm the trend reversal. The following resistance levels are $44K-$45K and then $50K-$52K ranges.

Short-Term

In the lower time frames, we can notice another significant resistance trendline (green line) that has been rejecting the price persistently. The bullish momentum has been decreased, and the price has reached the trendline. We must wait to see if bitcoin can break the trendline or get rejected. Also, the following resistance levels have been specified with the white horizontal lines.

Onchain Analysis

By: Edris

Looking at the short-term and long-term holders’ SOPR, it is evident that a particular pattern in this onchian metric may be reoccurring. During last year’s market crash, the market experienced a period in which the short-term holders realized losses constantly.

Near the end of this period, a massive rise in LTH-SOPR scared many retailers of the long-term holders. A large amount of these coins were also deposited into the exchanges. However, it seemed turned out to be a bear trap because the bottom was in, and the market rallied to a new ATH.

Now, the same pattern is in play again, but this time, the massive spike in LTH SOPR was because the Bitfinex hacked coins moved after a long time. Either way, considering the STH-SOPR, the bottom seems to be near if it is already in.

The technical indicators are showing weakness in the short term. The onchian activity of retailers as a reaction to volatile market is still rising. This can be translated to the high probability of a side chopping market in the mid-term. In a low trade volume phase, such as the current market condition, capitulation events are expected more than ever.

Technical Analysis

By: Grizzley

Long-Term:

On the daily timeframe, the recent uptrend was stopped by touching the low band of Bollinger Bands (BB) and a long candlestick was formed. Although the RSI indicator broke above its downtrend line, the safer strategy would be to wait for the price crossing BB baseline. Then market participants can be confident that the buyer’s side is more powerful in the order book.

Short-Term:

Bitcoin was rejected by the formed supply zone at $39.3K leading to a correction on the 4H timeframe. The first support at $36.2K has held the price so far, and the lower shadows on the candlesticks indicate buying orders in this area. The next support is at $35.5K while crossing the supply zone ($39.3K) is vital for continuing the upward trend.

Onchain Analysis

By: CryptoVizArt

The activity of retailers on bitcoin’s network can be mapped with many metrics. Among the simplest but most powerful ones that analysts can utilize to estimate the intensity of the small investor’s activity is the Median Size of the Transferred Token per transaction.

The 14D SMA of this metric is demonstrated in the above chart. The evident divergence between price and the 14D SMA of this metric in the following image is a sign that retailers are still reacting to the fear in the market. A trend reversal would be a sign that paper hand investors are flushed out of the market and a price recovery would be feasible in mid-term

While bitcoin is recovering from its massive 50% crash since reaching the ATH in November 2021, the onchain and technical indicator are not showing strong momentum and signs of a bull run renewal.

The market structure is similar to 2021’s Jun – July bottom, and without a catalyst, a likely case for bitcoin is to be traded sideways in the mid-term.

Technical Analysis

By: Grizzley

Long-Term: The Daily

On the daily timeframe, by examining historical data of the previous two market corrections, the trend was reversed after the 14-Day RSI (marked by yellow vertical lines) broke above the SMA- 200 line.

Also, the beginning of the downtrend has been associated with breaking below this long-term moving average line, marked by red vertical lines. Therefore, if history repeats itself, a possible crossing in the mid-term can provide a better opportunity for traders to rejoin the market.

Short-Term: The 4-Hour

Bitcoin on the 4-hour timeframe is struggling with the same downtrend line since touching the ATH. So far, the price has been rejected by it.

The intersection of this downtrend and the static resistance at $40K is a critical area to overcome in order to continue the uptrend. Breaking above this area could signify that the bulls are returning to the market.

Onchain Analysis

By: CryptoVizArt

The Net Unrealized Loss (NUL) shows the aggregated value of UTXOs in a loss, divided by market cap. An increasing trend in value means that more investors are starting to be at a loss, which might indicate a possible bottom.

Since touching $33K a week ago, this metric has fluctuated in the 0.1 – 0.17 range, resembling the same structure that the market had seen in 2021 Q2’s bottom reached in June. Based on this metric, a possible scenario is a sideways chopping over the mid-term.

After a bloody week, the bitcoin price is slowly recovering, following a 50% drop since recording the ATH level of $69K during November 2021. The following analysis will discuss two possible scenarios going forward, from a technical point of view.

Technica Analysis

By: Shayan

Long-Time Frame: The Daily

Looking at the daily chart, the BTC price has been recovering since it plunged over 50%, plunging below $33K last Monday.

However, Bitcoin is still beneath two critical resistance areas right now. First is the blue bearish trendline pushing the price down each time BTC attempted to break above it, and the second zone is the range marked in red between $39K and $41K.

On the other hand, the daily RSI has broken out of the multi-month low sloping resistance. The two previous breakouts had led to huge bullish moves over the past year.

In conclusion, the two likely scenarios are :

1. ‌Breaking above the descending trendline and the red area (around the $40K zone), consolidate above the zone for a while, generate a pullback to the resistance, and begin a price rally into the $50-60K channel.
2. Getting rejected by both the trendline and the horizontal resistance area, forming a new lower-high to confirm the bearish trend, then a drop to lower price levels and test support zones to develop a new local bottom.

Short-Term Time Frame: The 4-hour

Bitcoin has multiple resistance levels in the lower timeframes (LTF), as indicated in the following chart. The price has created lower highs and lower lows inside a solid bearish descending channel.

The price is now trading below the 100-MA line and the channel’s upper trendline. As a result, if the market is set to bounce back and begin a newly bullish rally, it is required to break out of the trendline and complete a new higher high, as shown by the green path.

The other scenario is that the price touches the trendline, records a new lower high, and then gets rejected on its way to retest lower price levels (the red path).

Onchain Analysis: Stablecoin Inflow

By: Edris

The following chart consists of BTC price and the 7-day moving average of stablecoin inflow.

As you can see, there has been a significant rise in the volume of stablecoins deposited into exchanges over the past few days.

The last time we witnessed such a sharp increase in this metric was in May 2021, following the crash to the $30k range. This suggests that liquidity is ready to buy the dip. However, accumulation phases after huge market crashes usually take a while. So, it may take a few weeks or even months before a price rally happens, just like last year.

During the recent weeks, the cryptocurrency markets have plunged due to fear at the macro-level (risk off). In this analysis, we will take a closer look at the bitcoin price from the Technical, Onchain, and Options Markt standpoints and discuss the possible scenarios in the short and mid-term.

Technical Analysis

By: Shayan

Long-Term Analysis

We can observe how the price organically evolves into a larger corrective structure following the first bullish impulse phase. A few swing highs and lows appear, which assist in identifying a corrective structure.

In the bigger picture, the BTC price made a double top, ascending channel, and Head and Shoulders pattern from the region of the all-time high (November 10, 2021), providing us with a sell confluence.

Since November, the BTC price has been in a downtrend, with smaller time frame’s corrections. A consolidation might occur because we haven’t reached the prior swing lows, pushing the price down to the previous higher time frame (HTF) lows and completing the whole pattern.

It’s critical to wait and watch whether any positive reversal price action forms until the price reaches the bottom region (marked by the orange line on the above chart). These confirmations are important in determining if the price can restart another bullish leg.

Short-Term Analysis

As shown in the following 4-hour time frame chart, the price is in a clear downtrend, which started since BTC hit ATH at $69K.

The marked ascending trendline has been acting as substantial resistance to the price. Bitcoin has many significant resistance levels on its way up to reclaim the $40-50K price range, so it has to form a higher high pattern to bounce back and start a fresh rally.

In case bears continue, then further support level is the previous low in the higher time frames, which is the $30K zone.

Onchain Analysis

By: Edris

One of the key metrics signaling an imminent bearish momentum back in Q4 of 2021 was the rising Derivative Exchange Reserves.

Asymmetrically, the spot exchange reserves have been in a long-term depletion, and this contradiction indicates that the dips got quickly bought and withdrawn from the Spot exchanges. So, it is evident that we are in an accumulation phase, which is bullish for the mid to long term.

Options Market Analysis

By: NEDA

This Friday, January 28th, approximately $2.1B worth of bitcoin options contracts will expire on Deribit. This is the most important expiry for this month.

Max pain price is $42K, and the P/C Ratio is 0.5. According to extreme fear in the market and spot sell-off, options traders sold calls and bought puts in order to hedge any downside due to the upcoming Fed’s meeting (21 UTC on Wednesday). P/C Ratio has increased since January, indicating a bearish sentiment in the options market.

In an indecisive spot market, the low liquidity in the order book allows the aggressive traders to take control, leading to unexpected volatility. Currently, the futures market may see more liquidations before any price recovery.

Technical Analysis

Daily Timeframe

The image below shows that bitcoin is in a strong downtrend, and the bears are in charge. However, we’re in a zone that can hold the price for a few days or even weeks. Additionally, the RSI indicator, which helps us gauge the price momentum (currently <20), shows that the market is in a “Strong Oversold” phase.

4-Hour Timeframe

On the 4-hour timeframe, we can observe that the price formed a continuation pattern followed by another bearish impulse after the bearish flag breakout.

It’s also clear that RSI is probably creating a bullish divergence, indicating that the price is likely to consolidate in the short term. It’s important to monitor the market in the next few days to determine if the price has formed an accumulation/distribution pattern to forecast future action.

Onchain Analysis

By Shayan

Retail traders tend to enter high-leverage positions in futures markets. This behavior indicates a market with an excessive appetite for risk and leverage. Naturally, when the bitcoin price is falling, the high-risk positions vulnerable to volatility will cause a cascade of liquidations.

Following the sentiment of the futures market in June-July 2021, a significant drop in open interest (OI) is crucial before any price recovery.

A sharp decline in both OI and ELR metrics, as well as a long period of negative funding rate, are the necessary signals for a market recovery.

The technical analysis was made for CryptoPotato by Edris, while the on-chain analysis was prepared by Shayan.