11/15 - Macro for Humans
Market Overview
Headline
Bitcoin Bears Roar as Global Markets Hit Pause Button
Summary
Crypto markets face headwinds as Bitcoin slides below key support levels. Meanwhile, traditional markets are in a holding pattern, with stocks, bonds, and the dollar all consolidating recent moves.
Mood
Cautious and uncertain. It's like the market is holding its breath, waiting to see which way the wind will blow next.
What Changed Recently
Bitcoin's sharp drop below $95,000 has caught many off guard, shifting sentiment from cautiously optimistic to decidedly bearish in crypto circles.
Comparative Market Analysis
Vs 7 Days Ago
Stocks
The S&P 500 has barely budged, suggesting a 'risk-off' sentiment isn't driving crypto's decline. This disconnect could mean crypto-specific factors are at play.
Dollar
The dollar remains range-bound, providing little directional push for crypto. This neutral stance leaves more room for crypto-specific narratives to dominate.
Interest Rates
Bond yields are stable, indicating steady interest rate expectations. This stability typically supports risk assets, making crypto's weakness more notable.
Bitcoin Dominance
Bitcoin dominance has held steady, implying the sell-off is broad-based across crypto rather than a rotation into or out of altcoins.
Vs 14 Days Ago
Stocks
Stocks have consolidated near all-time highs, maintaining a bullish backdrop. Crypto's divergence from this strength is a red flag for short-term sentiment.
Dollar
The dollar's continued range-bound behavior suggests global macro factors aren't driving crypto's moves. Look to industry-specific news for explanations.
Interest Rates
The stability in yields over two weeks reinforces that interest rate expectations aren't behind crypto's volatility. Internal market dynamics are key.
Bitcoin Dominance
Bitcoin dominance has remained neutral over two weeks, indicating no major shift in the Bitcoin vs. altcoin narrative despite price weakness.
Crypto Specific Trends
Current State
Bitcoin Vs Alts
It's an 'everything must go' sale in crypto land. Both Bitcoin and alts are facing selling pressure, suggesting broad risk reduction rather than rotation.
Hot Sectors
Defensive plays like stablecoins and low-volatility yield strategies are seeing increased interest as traders seek shelter from the storm.
Volume And Activity
Rising volume on down days points to conviction in the selling. The bears are roaring, and they've brought friends to the party.
Key Shifts
Week Over Week
The mood has soured dramatically. A week ago, we were eyeing $100k Bitcoin. Now, traders are nervously watching $90k support.
Two Week Trend
We've gone from cautious optimism to outright bearishness. The uptrend that defined early November has been erased in a matter of days.
Notable Reversals
Bitcoin's failure to hold $100k has turned a potential breakout into a breakdown. This psychological blow has rippled across the entire crypto market.
What This Means For Traders
If Youre Bullish
- Look for oversold bounces, but be patient. Wait for a clear reversal pattern before jumping in.
- Watch for a bullish divergence on the 4-hour RSI as a potential early sign of a bottom.
- Consider scaling into long-term positions if you believe in the bigger picture, but keep position sizes small.
If Youre Bearish
- Short-term traders might look to sell rallies rather than buy dips in this environment.
- Watch for a break below $90k on Bitcoin as a potential trigger for another leg down.
- Be cautious of sudden bullish news or oversold bounces that could trigger sharp short squeezes.
If Youre Uncertain
- Cash is a position too. Sometimes the best trade is no trade, especially in choppy markets.
- Keep an eye on the $90k-$95k range on Bitcoin. A decisive move out of this range could set the next major trend.
- Watch for a return of volume and volatility, which often precede major moves after consolidation periods.
Evolving Trading Guidance
What Changed
From 7d Ago
A week ago, we were looking for breakouts. Now, it's all about managing risk and protecting capital.
From 14d Ago
Two weeks ago, dip-buying was working well. That strategy has become increasingly risky in the current environment.
Current Best Opportunities
For the brave, oversold bounces on strong projects could offer quick trades. For the cautious, stablecoin yield farming provides a safe haven.
Approaches To Avoid
Avoid trying to catch falling knives or making large directional bets until the market shows clearer signs of stabilization.
Timing Considerations
Short timeframes are treacherous right now. Consider zooming out to daily charts for a clearer picture and to avoid getting shaken out by noise.
Key Levels To Watch
Critical Thresholds
Bitcoin's $90,000 support is the line in the sand. A decisive break below could accelerate selling, while holding above might inspire dip buyers.
Recent Breakouts
The break below $95,000 on Bitcoin has turned previous support into new resistance. This flip is a bearish sign that shouldn't be ignored.
Approaching Tests
Ethereum is approaching its 50-day moving average around $5,200. How it reacts here could provide clues for the broader alt market.
Final Advice
Main Takeaway
Caution is the name of the game. Protect your capital and wait for clearer skies before making big moves.
Biggest Change
The rapid shift from 'when will we break $100k?' to 'will $90k hold?' highlights how quickly sentiment can change in crypto.
Risk Reminder
Remember, no trade is often the best trade in uncertain markets. Your primary job right now is to survive to trade another day.