The long held bullish view on cryptocurrencies have largely materialized towards relevant target levels.
It is always possible that the market can extend, but we assess that the risk of a bearish reversal has now become higher than further extensions of the bull trend.
“Markets can stay irrational longer than we can stay solvent”
Note : As per usual this week will be the final reporting schedule for 2024.
While the recent bullish view and important target levels are retained,
Non classical short term market action and subdivisions in the move from 17.29 to current levels continues.
The preferred and illustrated interim outcome is therefore subject to a measure of short-term uncertainty.
The current US Dollar bull trend is approaching respective medium-term targets against most currencies.
There is a likelihood of a trend reversal, or at the very least a meaningful correction of current Dollar strength.
Please find attached the month-end Rand report where we examine the local currency against the major global counterparts.
While the longer- term bearish outlook on the US currency remains valid, medium- and short-term outcomes were adjusted since last week’s report.
The alternative outcome of consolidating market action was validated by extended short term appreciation beyond pivotal levels.
Further medium - term range trading has postponed the still relevant and eventual bear trend to new lows.
The medium-term bullish outlook on Bitcoin could be materializing as the market breaks above initial key resistance.
Interim overbought conditions are likely to result in a corrective phase, but this would remain part of the larger bullish bias, if pivotal support holds.
The expected bull trend should complete the cyclical upside that started at circa $ 16 000.
Ethereum remains less certain. The general view of a medium-term bottom, however, seems to be materializing.
The USD/ZAR medium- and short- term expectations remain in line with recent market moves.
We expect volatile range trading within medium term parameters for the rest of the year.
The occurrence of a rare running correction with extended bullish consequences remains possible,
but is not the preferred outcome. We will keep a close watch as price action develops and clarifies the situation over time.
The US Dollar Report for the 16th of October 2024.
The medium-term bullish outlook on Bitcoin should be close to materializing as the recent consolidation phase nears completion.
The expected bull trend should complete the cyclical upside that started at circa $ 16 000.
This view is despite our well documented fundamental scepticism.
Ethereum remains somewhat of an enigma. It does seem, however that the market is constructing a medium-term bottom
that could result in a meaningful bull phase/relief rally.
Medium term moves have remained within long term consolidation parameters and have also consistently exhibited corrective traits.
This suggests that while the USD/ZAR pair should remain within stated parameters.
Volatility and ad hoc moves is likely to continue for the rest of 2024.
The general bearish stance on the US Dollar remains preferred.
An expected correction in the bear trend has, however exceeded the indicated target levels.
This counter trend strength requires us to suggest a viable alternative possibility for a return to the largely ranging market conditions before the recent bearish break out.
Fortunately pivotal activation levels are quite close to current market levels.
The general consolidation in BTC is fast maturing and should result in a bullish outcome to new highs.
ETH remains difficult to pinpoint. Our medium- term bullish outlook was neutralized after a failure to reach new highs.
The best alternative is for this market to continue with an extended and overlapping bottoming formation.
The cryptocurrency market has evolved from a highly correlated entity to the current situation where the various currencies exhibit unique trends and outcomes.
The stark divergence between ETH and BTC outcomes over time has been notable.
For the technicians and perma- Rand bears we have added a short term second alternative outcome analysis.
This is a rare formation with a low probability of materializing. A breach of 17.35 will negate this outcome
Bitcoin and Ethereum technical pictures continue to diverge.
While BTC is consolidating as part of a cyclical bull trend, the long-term outlook for ETH remains more muted with volatile moves within a wide trading range.
The goal of long-term analyses is to give a visual representation of trend potential.
It is not intended as a trading or timing input but does confirm the medium- and shorter-term views.
It is also a useful input onto strategic decision making.
Our medium to longer term bearish stance on the Greenback is ongoing.
Further weakening is expected to reach our long-held target levels.
This is unlikely to be the move that perma- bears expect to “ dethrone the US Dollar” . It is more likely a bearish correction in a cyclical bull trend.