The only thing you can do with crypto right now is short the market, because it’s going nowhere anytime soon.

Ethereum went back and forth on Tuesday as we are trying to catch a breath after a major selloff. Crypto continues to plunge, but this candlestick does suggest we could get a short-term bounce. The short-term bounce could be an opportunity for people who are trapped at the moment to get out of the market. I would not be a buyer of this bounce, because crypto has much further to go to the downside.

If we break down below the bottom of the candlestick, then we just simply fall through the $1000 level. I do think that Ethereum will break down below there and go looking to an even lower level. At this point, I would not be surprised at all to see Ethereum drop to the $400 level again. The Ethereum market is especially vulnerable to all of the fraud that’s been going on because a lot of it is built on top of the Ethereum market. It’s not necessarily the fault of Ethereum, but it is most certainly the problem of Ethereum.

Monetary tightening continues to be a major issue, and central banks around the world doing that will continue to put a lot of pressure on crypto in general. Ethereum will probably do better than many other coins, but it still plays second fiddle to Bitcoin, which happens to look very negative as well. At this point, any rally will probably run into a lot of resistance near the $1750 level, which extends to the $2000 level, as well as the 50-day EMA. There’s nothing on this chart that suggests that you should be a buyer anytime soon, and crypto is about to enter a period of long-term malaise, so if you are a longer-term believer in crypto, you will get an opportunity to build up huge positions here relatively soon, but there’s no need to be in a rush.

As for trading crypto, the only thing you can do with crypto right now is short the market, because it’s going nowhere anytime soon. It will take the Federal Reserve and central banks around the world to change in their monetary policy before crypto even stands a chance. Beyond that, people will have to forget about the losses and the fraud that have all occurred recently.

The crude oil markets have been bullish for quite some time, and now that we have worked out a lot of volatility, it’s likely that we will be able to stabilize and grind higher.

The West Texas Intermediate Crude Oil market initially pulled back just a bit on Friday but turned around to show signs of life again. By doing so, the market will have traders thinking that a breakout is imminent. I recognize that there is an area between the $115 and the $116 levels that is a bit difficult. Breaking above there is the next challenge but based on the candlestick that we have formed for the Friday session, that’s likely to happen rather soon.

Keep in mind that there are a lot of concerns about supply to begin with, but now that China seems to be ready to reopen, that should drive more demand going forward. That is the biggest story right now, perhaps right along with the Russian invasion of Ukraine. Nonetheless, we are entering a traditionally bullish time of year anyway, as the summer driving season begins. Now that the market is pricing in a reopening trade and of course China will only exacerbate that, there are plenty of reasons to think that this market is going to go higher.

It’s also worth noting that the most recent pullback stopped just above the 50-day EMA, so in that scenario, it has performed much better than it had in the three previous breaks, which tested the uptrend line. Ultimately, this is a market that is more likely than not going to continue to attract a lot of value hunting, and it’s very difficult to imagine a scenario where you could be a seller. In fact, it’s not until we break down below the uptrend line that there is a potentially negative setup. Anything between now and then that is a pullback will more likely than not will be thought of as a value proposition.

As far as a target is concerned, the recent highs at the $128 level could be a potential target. The crude oil markets have been bullish for quite some time, and now that we have worked out a lot of volatility, it’s likely that we will be able to stabilize and grind higher. That does not necessarily mean that it will be an easy trade, but it certainly looks as if it is the most likely of direction going forward.

ADA/USD is near important support in early trading this morning, as a reversal produced late on Monday reminded crypto traders a bearish storm still exists.

ADA/USD displayed a strong selling reversal in late trading on Monday and sank to a price of nearly 50 and a quarter cents momentarily.  In early trading this morning ADA/USD has climbed higher, but it remains within sight of important support levels. The lingering images of support junctures on charts should keep technical traders rather nervous, as they are served strong reminders that the long term bearish trend in the broad crypto market continues to create sudden declines.

ADA/USD is trading slightly above 52 cents as of this writing; yesterday’s high in Cardano was slightly below 56 cents.  ADA/USD sank after touching this mark and its trading mirrored the results among its major digital asset counterparts as a selling wave developed across the board. Perhaps profit taking took place among traders who had been waiting for higher ground to be demonstrated so they could cash out positions.

Or more troubling, is the notion that durable resistance levels continue to shadow the crypto market. The highs generated yesterday may have been taken advantage of as a way to close positions, which had reached equilibrium and allowed traders to walk away from positions which had been weighing them down with losses.

ADA/USD offers traders an opportunity to engage in short term trading tactics. Nearby support around the 0.51750000 level could prove important, if this level proves vulnerable short term it could spark additional concerns that selling momentum will increase. The inability of Cardano and other major cryptocurrencies yesterday to hold onto near term highs may be the beginning of another serious leg down. While some bullish traders may believe ADA/USD has been oversold, skeptics who remain sellers may look at moves higher as a way to ignite selling positions.

The long term bearish trend remains intact in the cryptocurrencies and ADA/USD has suffered like its major counterparts.  Speculators who have the courage to be sellers and pursue downside momentum based on the perception that current support levels will falter and lows seen on the 20^th of May will be retested cannot be faulted. If ADA/USD breaks below current support and price velocity is strong, Cardano could challenge important depths quickly. Traders need to use take profit and stop loss tactics to make sure the price of ADA/USD does not surprise and harm them.

Cardano Short-Term Outlook

Current Resistance: 0.52670000

Current Support: 0.51720000

High Target: 0.53460000

Low Target: 0.50330000

I will short signs of exhaustion as they occur, it will not be convinced to buy this market until we break above the 0.72 level.

The Australian dollar has broken higher during the trading session on Thursday as we have seen the US dollar gets hammered. That being said, we are still very much in a downtrend so therefore I do not look at this as something that changes the outlook, rather it could be setting up for a potential opportunity. After all, the US dollar is the strongest currency in the world right now, despite what we had seen during the day. Furthermore, the US dollar was somewhat overbought so it should not be a huge surprise to see that we had a little bit of a turnaround.

As you can see, the 0.70 level has been important multiple times, so that is not a huge surprise to see that the market reacted here. At this point, I do not believe that the market is one you can buy with any type of confidence, simply because it would only take yet another shock to the system to get people concerned again. The Australian dollar is highly levered to China, and of course the commodity markets. The idea is that if the global economy continues to slow, it could very well put a bit of a beating on the Aussie dollar as a proxy.

One of the main drivers of US dollar weakness during the day was yields dropping a bit, but they are still very elevated at this point. This suggests that perhaps we are going to continue to see the US dollar favored, and that it is only a matter of time before it starts to strengthen again. That is how I look at this market, one that has sold off for a reason, and will continue to do so over the longer term. As things stand right now, I believe this is a scenario in which we need to be cognizant of the yields in the 10 year when it comes to the US dollar. If those yields start to rise again, that will send the Aussie much lower. That being said, it needed to bounce after selling off the way it has, so I look at this as a blip on the radar more than anything else. I will short signs of exhaustion as they occur, it will not be convinced to buy this market until we break above the 0.72 level.

While I do believe that Bitcoin will be a good investment longer-term, I also believe that you will get an opportunity to start buying at much lower prices.

Bitcoin has rallied ever so slightly during the trading session on Thursday, as we continue to hang about the $30,000 level. There does seem to be a certain amount of hope or wishful thinking going on out there, so be interesting to see how this plays out. Quite frankly, I think it is probably only a matter of time before something bad happens, but a bounce could be the first thing. In fact, I would not be surprised at all to see this market bounce, but I would also anticipate a lot of selling pressure above.

As long as there is an institutional desire to own US dollars, mainly as a function of the Eurodollar system, it is going to be difficult for Bitcoin to attract a lot of major inflows. Yes, some retail traders will live and die by Bitcoin, but they do not move the market. In fact, the people who do move the market are shunning Bitcoin as a lot of them have just been eviscerated and other crypto markets.

If we break down below the bottom of the candlestick from last week which is at roughly $25,854, this market will make a beeline towards the $25,500 level, and then eventually the $25,000 level after that, dragging the rest of the crypto markets down with it. A lot of what you are seeing here is due to US dollar strength, and a general “risk-off” type of attitude around the world. I find it difficult to believe that a lot of money is suddenly going to go looking to get involved in these types of markets, as we need some type of stability in more traditional markets to even approach that type of environment.

While I do believe that Bitcoin will be a good investment longer-term, I also believe that you will get an opportunity to start buying at much lower prices. If we head into the type of buzzsaw recession I think is starting to be imagined, this will send the entire crypto market much lower. It is only when you have cheap central bank money that crypto gets a huge bid. After all, one of the huge tenants of crypto has been all of the central bank’s “printing of money.” (This is a ridiculous concept because money is not created by central banks, it is created by loans.) Leaving that aside, it is worth noting that the Federal Reserve is getting tighter, not looser.

The reaction over the last couple of days has really put a dark cloud over this market, so we will have to wait and see how this plays out.

The Bitcoin market did very little on Tuesday after selling off quite drastically on Monday. By sitting still, we are trying to figure out whether or not the $40,000 level will be an area of importance going forward, perhaps extending all the way down to the $38,000 level. If we were to somehow break through all of that, it would be a very negative turn of events, and the fact that we have seen this market be so noisy means that it could very well happen.

Looking at the size of this candlestick is interesting to see that we have stopped dead in our tracks, so if we were to turn around and break above the top of the candlestick, the theory is that there would be buyers coming back into the market. However, the overall risk appetite out there is a bit dicey, to say the least, and that does no favors for Bitcoin. If we were to break down below the $35,000 level, I believe that the Bitcoin market will fall apart, and we could see a massive move much lower.

Alternately, if we can take out the 200-day EMA above, which would be near the $44,386 level, then the market is likely to go higher. At that point, we will probably threaten the $48,000 level, followed by the $50,000 level. That being said, this market looks like it is going to consolidate at best, so I think you have plenty of time to get involved with Bitcoin, because crypto in general looks soft, to say the least.

Ultimately, if you are a short-term trader, you may use the $40,000 level as an entry point or support point. At this juncture, I think the market is probably one you need to trade from a short-term standpoint, so I would be very cautious about trying to hang on to the move unless you are comfortable holding through “crypto winter”, which is a very real possibility at this point. The reaction over the last couple of days has really put a dark cloud over this market, so we will have to wait and see how this plays out but I do not necessarily see this chart as being as enthusiastic as it had been previously.