2100NEWS Crypto Market Breadth Survey

Written by on January 10, 2019

Analysis of Market Direction… Timing is Everything!

We use a combination of several methods and look for confluence and increase their odds. Breadth indicators offer a different perspective on the markets that can’t be seen through other indicators. They are powerful technical analysis tools that gauge the direction of the market and help determine if it’s bullish, bearish or neutral. They do so by analyzing the degree of participation in an advance or a decline to see whether or not an uptrend or downtrend is broad-based and therefore likely to continue. 

After Christmas, momentum was lost and direction of the market was neutral, trend sideways. The struggle to close above a key resistance level has left the asset vulnerable to shorts and increasing sell-pressure. Based on the indicators, one can see that traders are clueless at this point, which leaves the path of least resistance to the downside. We analyze the crypto market breadth and direction of the market by showing charts 2100NEWS Digital Assets Total Index (NWST1100) which represent top 1100 Digital Assets and 2100NEWS Digital Assets 100 Large Cap Index (NWSL100) which represent 100 large-cap Digital Assets.

2100news Digital Assets Total Index (NWST1100)

What do these charts tell us? Looking at the breadth charts ADVL shows us choppy up and down graph. The ADVP is negative for four consecutive days in order to create a negative trend on the market. ADVP is a breadth statistic based on Net Advancing Volume, which is the volume of advancing digital assets less the volume of declining. ADVP is weighted towards large-caps. McClellan summation index is lagging indicator vs. ADVL and with it, we are looking for confirmation. It is still positive but declining (blue arrow) for the first time after Christmas rally.

 

Sideways price action last fifteen days is due to the fact that the market did not have the energy (momentum) to become bullish (RSI <60). The market is always moving in the waves, the wave of PPO histogram shows that it can follow a few days of a negative wave. If buyers think that this is a buying opportunity, the index value will remain in the surroundings of the pivot near 415 points. Market shows signs of short term downtrend inside bigger sideways trend. Bears have more dominance in the market as bulls go back into sleep mode. On the downside, if the price fails to hold the 415 level, we could see a powerful selloff in the market, potentially taking us down to 350. 

 

 

2100news Digital Assets 100 Large Cap  Index (NWSL100)

Looking at the breadth charts ADVL shows us choppy up and down graph. McClellan summation index is lagging indicator vs. ADVL and with it, we are looking for confirmation. It is still positive but declining (blue arrow) for the first time after Christmas rally.

 

Large-cap Digital Assets have similar charts as total market.  Sideways price action last fifteen days is due to the fact that the market did not have the energy (momentum) to become bullish (RSI <60). The wave of PPO histogram shows that it can follow a few days of a negative wave. If buyers think that this is a buying opportunity, the index value will remain in the surroundings of the pivot near 400 points. Market shows signs of short term downtrend inside bigger sideways trend.On the downside, if the price fails to hold the 395 level, we could see a powerful selloff in the market, potentially taking us down to 320. 

 

 


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