Weekly Market Update – 10-3-2022


BTC Overview (Long-term and Short-term Technical Analysis)

US100 Overview


BTC Overview

It was another strong week for the dollar, with prices generally trending lower against the U.S. dollar, and both the US 100 and US 30 and Gold were generally weak, as they both headed lower and made new lows.


However, the BTC price is still likely to rebound in the short term, so this week should be watched closely. As the month turns over, we would like to build positions based on the positive monthly trend.


BTC also showed a decline this week, in tandem with the decline in the US100, and continues to have a heavy upside. However, as we mentioned last week, we have the strong impression BTC has been able to withstand the declines in other markets, such as the US 100, without being too closely correlated to the declines in other markets. This week, I feel the correlation between BTC and the US 100 has been even less. This is something to keep in mind. To put it more simply, we are noting BTC has not made new lows while the US100 and US30 have made new lows.


The difficulty in the current market is it is impossible to make a judgment based on BTC alone. It is important to make a comprehensive judgment by observing each factor in a complex manner.


Since monetary easing has temporarily ended, funds have been withdrawn from the market, and the U.S. dollar showing strength, there is no need to rush into buying positions over a long time horizon. This is a phase to protect funds, not the phase to be on the offense. (repost)


↓ Monthly candlestick chart of BTCUSD

This week we will start with the standard environmental recognition as we have a monthly update in between. Last month was a negative candle with small substance. The recent low was not broken and the market was range bound. The initial move this month is lower.


As I somewhat mentioned in my opening overview:

  1. BTCUSD appears to be holding its own against a decline in US equities (US100 or US30)
  2. The short term price correlation between the US100 and BTC is lessening
  3. BTC and Gold tend to rise toward the end of the year


From the three points above, I am going to try to take a long position against the recent low of $18,000 if I can this month. If the price breaks down a little, I will try to buy the dip once. If the price drops below $18,000, the low with a big drop thus I will stop trying to take a long position.


↓ Comparison of BTCUSD daily and horizontal axis

Next, let’s look at the daily chart. First, look at the horizontal axis (market cycle). As you can see in the chart above, it seems the price movement is about to show a direction in terms of the cycle. (This is an even more macro view than last week’s horizontal axis analysis.)


Combined with the monthly update and other factors, I also believe volatility is likely to expand somewhat from this simmering price action.


Combining these factors with the monthly analysis in the previous section, we think we will stand in a long position for the time being. From a macro perspective, the current price range is the high of 2017, and we can see once again this area is a place where the market can struggle, where selling and buying can compete with each other. This is a level where a rebound is possible.


Of course, the possibility of a break below is not zero, and in such case, I will stop chasing longs.



US100 Overview


↓ 3-day candlestick chart of US100

The US100 is falling again, as it did last week.


Last week I stated, “judging solely by the chart, I think it is likely to attack lower prices to the recent lows around $11,000-$11,500.” The price fell to approximately this area, and the candlestick closed.



There are several horizontal support boxes in that area, and furthermore, the weekly 200 MA is present, so a rebound is likely. Since the monthly update is also due this week, we will keep a close eye on this price area from next week to see if a short-term rebound and a positive turnaround on the monthly leg can be seen.


Of course, there is a possibility the price will continue to fall after the week, but there is a white support box (around $10,500) immediately below that will serve as a resistance zone, and we think the monthly price will eventually turn positive.


In any case, unless the US100 rebounds, BTC is unlikely to rebound either, so as I always write, it is necessary to watch this as well. To reiterate, when taking a position in BTC, we need to consider the movement of the index as well.