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(Kitco News) - It was a day of profit-taking for the cryptocurrency market as traders capitalized on a decline in volatility to lock in profits from tokens that recently skyrocketed and rotated into coins that haven't moved yet but have a promising perspective.
Stocks traded mixed as investors reduced their trading activity ahead of the release of the October Consumer Price Index report on Tuesday, which will provide insight into how the Federal Reserve will move forward with interest rates. Comments from several Fed officials last week indicated that the central bank has kept the door open to more rate hikes, dampening the mood of investors who at one point were predicting a rate cut.
At the closing bell, the S&P and Nasdaq finished lower, 0.08% and 0.22%, respectively, while the Dow finished 0.16% higher.
Data provided by TradingView shows that Bitcoin (btc) bulls attempted to drive price action in the early hours of Monday but were roundly rejected by bears at $37,450, who then took control of the price action and slammed BTC to an afternoon low of $36,440.
BTC/USD Chart by TradingView
Strong performance by bears resulted in "November Bitcoin futures prices" [trading] weaker in early U.S. trading Monday, but not far below last week's contract high,โ according to Kitco senior technical analyst Jim Wyckoff.
1-day Bitcoin futures chart. Source: Kitco
โBTC bulls still have a strong overall near-term technical advantage,โ Wyckoff said. โThe bullish price trend on the daily bar chart is firmly maintained. Look for consistent higher price action in the near term.โ
MN Trading analyst Gunter Lackmann noted that โseveral cryptocurrencies continued to see a notable increase in trading volume,โ in Monday's edition of Trade Letter.
โBitcoin's recent rally was supported by speculation that a Bitcoin spot ETF could be introduced before November 17,โ Lackmann said. โAt the same time, Ethereum (ETH) saw a surge following reports that BlackRock filed an application with the SEC for an Ethereum spot ETF. Two months ago, the overall cryptocurrency market capitalization was $1 trillion; Currently, it has increased to approximately $1.42 trillion.โ
Total cryptocurrency market capitalization. Source: TradingView
To get a better measure of relative strength across the market, Lackmann highlighted Bitcoin's 8-day exponential moving average (EMA).
โIts support is periodically tested and we see the bullish movement stagnate from time to time until the 8EMA value reaches the price,โ he said.
BTC/USD 1-day chart. Fountain: MN Commerce
"More recently, we surpassed $36,000 and we have not yet retested the area," he said. โWith the 8EMA at around $36,400, this small range could be used to extend or increase long exposure. As we still have a negative divergence between the RSI and the PA, if we start to see candle closes below the 8EMA, especially below $36,000, it may be time to become more conservative with long positions again until the market shows signs of strength again.โ
Lackmann said his โbase case is that we will see BTC rise to at least the $38.5K โ $42K rangeโ before โretesting the previous range high of around $31.5K.โ
โI have been gradually taking profits from my long exposure and have secured positions in both BTC and altcoins with SL at breakeven or in profit,โ he said. "Don't let FOMO and greed blind you to the cruelty of the market."
Crypto market analyst Tony agreed with this outlook that Bitcoin will eventually have a pullback that will take it to $30,000, which he sees as an excellent opportunity to load up before the next bullish leg.
#Bitcoin peaks and drops to $32,000 - $31,000, we will have a consolidation period
This will be your chance to get a good load if you missed the previous race.
- Crypto Tony (@CryptoTony__) November 13, 2023
And โThe Wolf of All Streetsโ podcast host Scott Melker also warned that the market appears overheated, with the technical chart showing overbought conditions and a bearish divergence as the BTC price approaches the established resistance level. by the collapse of Terra/Luna.
$BTC Daily
That's a reasonable time to wait for a cooldown, but Bitcoin doesn't always follow the rules.
LUNA Breakdown Key Resistance, Overbought with Bearish Divergence.
Be careful. pic.twitter.com/cv6ucqWYx1
- The wolf of all the streets (@scottmelker) November 13, 2023
Mixed day for the altcoin market
Altcoins traded mixed on Monday, with a vast majority of tokens in the top 200 trading in the red, while nearly a dozen tokens managed to post double-digit gains.
Daily cryptocurrency market performance. Source: Coin360
Memecoin (MEME) led the gainers with a 56.9% rise, followed by a 21.5% rise for Worldcoin (WLD) and a 16.3% gain for Bitget Token (BGB). Astar (ASTR) fell 14.2% to lead the losers, while Injective (INJ) and Blur (BLUR) fell 12% each.
The total cryptocurrency market capitalization now stands at $1.4 trillion, and Bitcoin's dominance rate is 51%.
Disclaimer: The opinions expressed in this article are those of the author and may not reflect those of Kitco Metals Inc. The author has made every effort to ensure the accuracy of the information provided; however, neither Kitco Metals Inc. nor the author can guarantee such accuracy. This article is strictly for informational purposes only. It is not a request to carry out any exchange of commodities, securities or other financial instruments. Kitco Metals Inc. and the author of this article accept no liability for any loss and/or damage arising from the use of this publication.
