The broad crypto space took a bit of a breather this week, seeing many of the coins within the Nasdaq Crypto Index ([NCI]) underperform the market over the last seven days.
The broad crypto space took a bit of a breather this week, seeing many of the coins within the Nasdaq Crypto Index (NCI) underperform the market over the last seven days. While the overwhelming technical picture is still positive for many coins within the space, this did lead to just over half of the coins within the NCI returning to columns of O’s on their default PnF chart. While this has yet to translate into sell signals for the majority of these members, those with exposure should keep a close eye on further coordinated moves across the group. While at first glance these synchronized reversals may seem daunting, it is of note that heavyweights Litecoin ($LTC), Bitcoin ($BTC), and Ethereum ($ETH) remain in their own respective columns of X’s and have each posted strings of consecutive buy signals, which is ultimately encouraging for the health of the space. Despite ultimately underperforming the S&P 500 (SPX) over the last week (-.79% vs. -3.63%), Bitcoin caps off an overwhelmingly positive March, posting a near 16% gain in the process of returning to a buy signal against our money market proxy.
One chart of note this week comes from Bitcoin Cash ($BCH), which has a more concerning chart picture. Despite returning to a buy signal with the rest of its peers throughout 2023’s rally, recent action has led to the formation of a triangle pattern. While it is true that triangle patterns are typically seen as a “continuation” of action (which in this case would be positive with the most recent crypto rally,) triangle patterns have spelled trouble for $BCH before. As seen in the chart below, 2022’s action led to the formation of three different quasi-triangle patterns, all of which ultimately led to further downside participation for the coin. With this in mind, those looking to enter into a position may wait for definitive price action in one way or the other as a sign of market confirmation.
