The Ghost of Lehman Brothers | Market Update
Total Crypto Market Cap: Weekly
Total Crypto Market Cap (TOTAL) is currently at $886 billion. If TOTAL goes down again, it could fall 30% to the next support point at $644 billion. How can you tell if a move like that is unfolding? If bitcoin can not sustain itself above $21,700, there is a risk of another leg down in crypto. Conversely, if bitcoin is above $21,700, the Total Crypto Market Capitalization should be stable.
Bitcoin: 89 Min Chart
$22,000 may turn out to be significant resistance in bitcoin. The recent burst above $22,000 may have been a classic stop-fishing exercise where smart money sold crypto to retail investors. Retail investors may have bought hastily, thinking the crypto market had bottomed. If retail investors realize they made a mistake or there is more bad news for Celcius or Voyager, bitcoin could fall to $16,000.
ETH Resistance Levels
$1390
$1,220
$1,172
(Data as of 07/10/2022 | Past performance is not indicative of future returns)
ETH Support Levels
$1,160
$1060
$960
$823
$770
$350
(Data as of 07/10/2022 | Past performance is not indicative of future returns)
Ethereum: 4-hour Chart
If Ethereum is below $1,150, a sharp three-wave decline could unfold. Any such drop would bring Ethereum back below $1,000.
Bitcoin: 4-hour Chart
Looking at Elliot Wave work on bitcoin’s 4-hour chart, a wave four correction seems complete. Said differently, the recent rally to $22,000 may have marked the end of the bear market rally. If a wave 5 materializes, the next move may be to $16,000.
Resistance Levels for Bitcoin are as follows:
$25,300
$23,000
$22,300
$21,700
Data as of 07/10/2022 | Past performance is not indicative of future returns
BTC Support Levels
$19,400
$18,600
$16,700
$14,200
$11,500
Data as of 07/10/2022 | Past performance is not indicative of future returns
SPX: June 2008 – January 2009
Bottom Line:
Much of the bad news about Celcius and Voyager is in the public eye. We do not know what entities have a low tolerance for more downside in crypto. The recent bankruptcies in crypto may pose further risks to the ecosystem. In 2008, the decline in stocks started four days AFTER Lehman Brothers declared bankruptcy. Lehman went bankrupt on 9/15/08. There was a sharp rally for about four days. Once that rally ended, the stock market fell 30% in 15 days. Looking at crypto charts on Sunday night (7/10), the same situation may be repeating. Multiple large crypto entities went bankrupt a week ago, and another leg lower may be starting.
