Consolidation Continues……selected comments below…..
- Key retest of the mid-July lows underway – In last week’s weekly CryptoTA note (here), we highlighted why we expected a short-term bounce followed by further sideways trading through the summer. Today most cryptocurrencies are once again at another important technical point as most coins retraced the prior week’s rally to retest important support at the mid-July lows. With short-term, 4-hour RSI indicators again oversold, another trading bounce is likely taking hold from current levels.
- Expect another oversold bounce within a broader summer consolidation – We continue to view the 2016 summer pause as a reasonable analog for BTC today. Weekly momentum indicators, tracking multi-month shifts, are still unwinding from very overbought levels reached in June and likely need to unwind neutral levels, or lower, before we recommend redeploying investment capital. In other words, remain patient through the summer doldrums in anticipation of a better technical backdrop later in Q3. A break below BTC 9K would be needed to negate our consolidation thesis. Slide 3-4
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