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Weekly Market report - 25.05.21

What our traders have to say about the cryptocurrencies' market.

Current Situation.

The Crypto market is led by bitcoin and for us to appreciate this market as a whole, we will consider bitcoin as the reference for the general analysis to understand where this market is heading from a technical perspective.

Since inception, bitcoin reached 17,798.68 high on 17/12/2017 in a five waves structure that was calling for a continuation higher after correction. This correction from the 17/12/2017 high took one year to complete down to 3,156.26 low to start a new cycle higher. The first leg of this cycle brought bitcoin to 13,970.00 high on 26/06/2019 in a three waves pattern that bulls could not convert into a bullish structure and from there we saw a deep correction to 3,782.13 low on 09/03/2020 (that we consider as an aberration event following covid-19 breakout as we initially called for the end of the correction on 18/12/2019 low at 6,435.00. By that time, we were waiting for signals to resume swing trades that did not come until early April in our system).

With the continuation of the fall in market last week, we have reassessed the structure and we now propose a major cycle has ended, truncated, at 64,854.00 all-time high dated 14/04/2021 from March 2020 low at 3,782.13. From the top, we now see a sharp corrective in a three waves pattern and while the correction was fast, the direct drop into the expected 41,731.58-30,808.15 is enough to end the correction.

We need to see a confirmation in the RSI but in lower time frames, we can already call the end of a cycle from the all-time high. From 30,000.00, we should now see a at least 3 waves structure to the upside or new highs.

What to expect this week.

The end of a cycle being completed from 64,854.00, we have reentered the market after it settled following the aftermath of the drop. We now expect to see at least 43,250-51,500 and we will be monitoring the structure in the daily view to decide to take profit in this region or to hold for new highs heading to 85,400-119,4000. The structure in 30min view during the opening in Asia is encouraging and we look forward to reinitiate swings upon bullish structures in coming sessions.

For mid and long term, we have jumped back in the market in few assets including bitcoin. A marginal new low from current level would not necessarily change our view in daily but we would then not hesitate to unload our positions. Other instruments like ETH, SOL or AAVE are supporting our view while others such BNB present structure that could also be calling for further weakness but only after the current bounce is completed in few days/weeks.

We like to buy bullish structures but carefully monitor progress as we are neutral in daily, bearish in 12h and 3h and bullish in 30min while weekly sentiment is still positive.

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