WTF on Friday Markets, 22.09

Markets are going to bleed again

Disclaimer: Technical analysis is a way of analyzing the financial market based on statistical patterns. Drawing lines on the chart itself does not predict price movements, but only helps the analyst to visualize the results of different types of analysis (macroeconomical, fundamental, technical, etc.). The analysis is not a financial recommendation, although it can be used to make trading decisions. Current analysis may become irrelevant if market conditions change dramatically. Good analysis does not always lead to good trading decisions, and vice versa.

Macro

Despite the fact that the Fed decided to restrain from raising rates at the last meeting, Powell’s rhetoric was very hawkish. The consensus opinion of the committee members is that there will be another increase this year, and there was neither relief nor a slight upside momentum on the markets whatsoever.

Apart from a few big tech blue chips like Nvidia, Microsoft, etc., the tech sector is locally oversold. An indicator of things being awful would be a collapse in the prices of the mentioned blue chips. The only true blue chip in crypto is Bitcoin, and it is holding up much better than the rest, purely because of the ETF narrative.

BTC

The strong price action from last week is almost gone. Bitcoin still holds better than most altcoins, but to continue rising from current levels, BTC needs to close the week above 27k. Despite everyone’s confidence, Bitcoin is not doomed to certainly fall to $20,000. This is simply the most likely scenario based on the current state. The longer Bitcoin stays above 25k, the less likely it is to fall to 20k. It’s not obvious, but it could hold at current levels until the ETF is approved.

MKR

MakerDAO has one of the best-looking charts among altcoins. Technically speaking, price broke through major resistance and then tested it, turning it into major support. The nearest strong resistance is at ~2280, and nothing actually stops MKR if Bitcoin breaks out of its downtrend. It is one of the few altcoins capable of outperforming Bitcoin in the near future. Fundamentally, the strength of the asset is driven by the fact that MakerDAO is a major player in the RWA segment.

AVAX

In contrast to MKR, AVAX has one of the worst charts. Nonstop downtrend. You can’t even determine the current support and the possible depth of the decline here. The asset definitely hasn’t found a bottom yet, and for it to start looking more or less OK, it needs to test resistance, or better yet, break through and consolidate above it. Until then, nothing is going to happen here.