A closely followed crypto analyst is keeping an eye on the top two digital assets by market cap as well as a pair of Layer-1 scaling solution altcoins.
In the latest TechnicalRoundup newsletter, pseudonymous analyst Cred says that Bitcoin closed the week without a clear signal about where BTC’s price is headed.
“Bitcoin/dollar offered a relatively ambiguous close following the all-important retest of weekly structure at $55,800-$60,000. Price closed above the range low but below the range high. That is neutral at best, and not exactly what we wanted to see at this inflection point.
We’re essentially forced to write ‘up or down’ because the weekly close didn’t offer much signal.
One of the better outcomes to this consolidation would be Bitcoin/dollar chop into altcoin moon. It likely wouldn’t be long-lived, but the opportunities that arise in those circumstances are very attractive.”
Cred sees much more promising signs from second-ranked crypto Ethereum after ETH managed to hold on to an important price level.
“Ethereum looks stronger than Bitcoin. The USD pair held the $4,000 range high on a closing basis and Ethereum/Bitcoin is moving towards its multi-month range high. Last week we argued that daily trend was broken and that it would likely land the market at the $4,000 area.
Now that $4,000 is holding, the only obstacle that remains is to reclaim daily trend. For us, this is best defined by the pre-breakout cluster (currently resistance) at $4,480-$4,610.”
Cred offers a word of caution to investors eager to take advantage of BTC’s price cooling off relative to the rest of the crypto market.
“The elephant in the room is that historically, Ethereum and altcoins showing significant strength while Bitcoin/dollar is on the precipice of a nuke, happens close to cycle tops.”
At time of writing, BTC is trading at $57,389, while ETH is priced at $4,275.
The analyst next looks closely at two leading smart contract platforms, Solana (SOL) and Avalanche (AVAX), as part of what he calls “L1 season,” as opposed to the general “alt season” that crypto investors are familiar with.
“The most compelling altcoin narrative has been ‘[Layer-1] season,’ which is embodied by Solana and Avalanche. As argued previously, the best environment for altcoins would take the form of Bitcoin/dollar chop in the weekly range ($55,800-$60,000).
Ethereum would likely continue to outperform as long as Bitcoin/dollar doesn’t accelerate to the downside, and Ethereum strength is to the benefit of the aforementioned L1s.”
Cred thinks SOL, which is currently trading for $205.49, is “above trend support.”
The analyst notes that Avalanche looks strong due to the lack of “high time frame pullbacks.”
AVAX is priced at $115.59 at time of writing.
You can read the full newsletter here.
Check Price Action
Don’t Miss a Beat – Subscribe to get crypto email alerts delivered directly to your inbox
Follow us on Twitter, Facebook and Telegram
Surf The Daily Hodl Mix
Disclaimer: Opinions expressed at The Daily Hodl are not investment advice. Investors should do their due diligence before making any high-risk investments in Bitcoin, cryptocurrency or digital assets. Please be advised that your transfers and trades are at your own risk, and any loses you may incur are your responsibility. The Daily Hodl does not recommend the buying or selling of any cryptocurrencies or digital assets, nor is The Daily Hodl an investment advisor. Please note that The Daily Hodl participates in affiliate marketing.
Featured Image: Shutterstock/3000ad/Sensvector/pikepicture