Layer 1’s, Stocks, Dollar, and Oil | Navigator
Review Date: May 28, 2022
Token Metrics Navigator
Market Update: Layer 1’s, Stocks, Dollar, and Oil
ETH Weekly Chart
If ETH closes below $2,040 this week, it creates a risk of a big move to the downside. There could be a ﬂash event with 1018 as a target.
AVAX: 2-Week Chart
Looking at a 2-week chart of AVAX using a log scale, you can get a ﬂavor that AVAX could go much, much lower. The Bill Williams oscillator on this chart shows the down move in AVAX maybe just getting started.
SOL – Weekly (log scale)
Looking at a log chart of Solana, the breakdown may be just beginning. VC selling could take SOL back to its lows from November of 2020. As an aside, November 2020 was the last tremendous crash in DeFi.
BTC 2022 vs. BTC 2014 Fractal
We suspect the current price action in BTC mirrors the last time bitcoin declined for six weeks straight. That was back in 2014. If the past scenario repeats itself, BTC could start falling at the beginning of June. BTC could then drop to $14,000 in three weeks. Then in July, BTC could have a massive one-week squeeze. That could take BTC to as high as $28,000.
S&P Futures: Daily
The levitation in S&P futures has been interesting. The stock market thinks the Fed will not do any more rate hikes. In ES, 4123 and then 4314 are key resistance levels. Crypto is falling while equities have been rising could mean two things.
- There is forced liquidation going on in the crypto space. This is likely a chain reaction from the wealth destruction of the LUNA debacle.
- The crypto down move could accelerate as soon as the equities up move ends in July. Equities will eventually ﬁgure out that the Fed will continue to raise rates to crush inﬂation, stocks, and real estate. One weak housing number will not unwind a 10-year parabolic in real estate.
- Equities are also assuming there can’t be a geopolitical event. That may not be a reasonable assumption.
DXY has strong support at 101. Williams oscillator shows a strong chance of renewed up-trend if DXY can bounce soon.
US Oil: Daily
Oil (USOIL) is now trading above 109.5. If USOIL rises above $115, $125 would be the next target. It is likely crude will rise to $156.
Bottom Line: The macro setup seems unfavorable to crypto. As oversold as they are, altcoins like $SOL and $AVAX could go down more than people think.