In this eighth Market Outlook here at Ostium Research, we'll be taking a look at the week ahead in markets, focusing specifically on price-action, positioning and event risk for Bitcoin, Ethereum, Copper, the Dollar Index and the altcoin market, via OTHERS.
Firstly, let's take a look at the calendar:
Another fairly quiet week ahead as relates to data releases, with a heavier lean on innumerable speeches:
MONDAY: VARIOUS FED PRESIDENT SPEECHES
TUESDAY: ECB PRESIDENT LAGARDE SPEECH
TUESDAY: BOE BAILEY SPEECH
WEDNESDAY: BANK OF CANADA INTEREST RATE DECISION (CONSENSUS 3.75% VS PREVIOUS 4.25%)
THURSDAY: INITIAL JOBLESS CLAIMS (CONSENSUS 247K VS PREVIOUS 241K)
THURSDAY: S&P GLOBAL COMPOSITE PMI (OCT) (CONSENSUS N/A VS PREVIOUS 54)
FRIDAY: DURABLE GOODS ORDERS (SEP) (CONSENSUS -0.9% VS PREVIOUS 0%)
Now, let's dig into asset-specific price-action for the week ahead, looking firstly at Bitcoin:
Bitcoin:
Price: $68.619
Thoughts: Firstly, let's take a look at these two higher timeframe charts published below, highlighting the weekly and daily view for BTC, before looking at a few hourly charts with potential setups, plus an overview of market positioning.
Weekly:
Beginning with the weekly view for BTC/USD, we can see that last week saw huge strength and continuation from the reversal the preceding week, rallying off the weekly open through the trendline that has been capping rallies all of 2024, firmly above the $66.5k swing-high to close out the week at $69k, right at the 2021 cycle highs and significant resistance. If we are to find a last stand of resistance, it is likely to be here, but given the sheer strength of last week's move and the clear shift in market structure here, it is evident the tide has turned and dips are now likely to be bought up aggressively. Momentum indicators look to be turning higher for a second wave of acceleration, much like just 12 months ago. The weekly close above the trendline that had capped the rallies all year is significant - and any retracement this week back into that trendline for a breakout retest should be considered for long entries. Bulls want to see $66.5k now hold as support this week and price to continue higher, where any weekly close above last week's high (~$69.3k) would be the signal for an attempt at all-time highs. Zero reason to be bearish now as long as we do not close the weekly back below that trendline.
Daily:
Looking now at the daily, we can see that despite the grind higher following the trendline breakout, momentum indicators aren't showing clear trend exhaustion. That said, we are now pressing right up into that final major resistance cluster between $69-70k, and there are a couple of daily candles that remain unswept. If we break lower early this week, we could see price take out $66.6k into prior resistance (and the trendline), which should act as significant support. If we do see that and a swing-low form around $66.6k, it is likely the next attempt at $69k gives way and we see continuation through to $70,000, where there is a swing-high that remains untapped. That is where I personally believe we could get some serious intraday volatility, given that that was the swing-high that preceded the capitulation candle into $49k. Any acceptance above $70k brings $72k swiftly, given the clean double top in that area, after which we have clear skies for $73.6k and price discovery. Daily structure is firmly bullish here - dips are opportunities this week. The Q4 open is confluent with the 200dMAat $63.3k, so if we get a significant shakeout and liquidation cascade that could be tagged briefly but would likely be front-run a touch given how perfect the level is.
Now, looking at the hourly for a long setup below, should we keep grinding lower from here without taking out the $69.5k high from last night, through the weekend lows towards the 200-hour MA at $66.7k, look for signs of seller exhaustion on the lower timeframes around there for a bid back above the weekly open at $69k into a green weekly close:
Unlike last week, there is a chance at a decent intraweek short setup here too, should we leave the weekend highs untouched and squeeze higher through $70k, then reject and break below the weekly open; we could short that breakdown into $66.7kish if that opportunity presents itself:
And below we can see a snapshot of positioning via Velo and CoinGlass:
In the CoinGlass chart below, we can see that since the 10th October, net shorts on Binance have been decimated whilst net longs have grown, open interest keeps making higher-lows and higher-highs but funding is basically flat since last Monday after the initial jump. We also see that spot has been selling since early last week but price refused to make lower lows, which in my view has been suggesting of spot seller absorption. If we do get a flush this week, look for $66.7k to reset some of these excesses, which would be healthy for continuation:
Finally, we can see 1-week and 1-month expected liquidation levels:
Ethereum:
Price: $2726
Thoughts: Let's begin by looking at the weekly and daily timeframes for the Dollar pair before moving onto ETH/BTC.
ETH/USD
Weekly:
Beginning with the weekly for ETH/USD, we can see that last week saw price rally off the weekly open through the Q4 open at $2600, breaking firmly above local trendline resistance to close at $2745, turning weekly structure bullish with a higher-high following that higher-low above the 200wMAand 2024 open. From here, bulls want to see the Q4 open act as support this week, forming a higher-low above $2600, from which price can finally push higher to test that all-important pivot at $2850. A weekly close above $2850 is what we need to see for confirmation that this reversal has legs; and no doubt a move to all-time highs for BTC/USD will give us this reclaim on ETH/USD of the $2850 level. Above that, it is clear skies back towards the yearly highs to be honest, with minimal resistance in between. If we close the weekly back below $2600 this week, it is likely we retest that trendline from 2022 again. Bullish above the confluence of support between $2280 and $2360, with momentum indicators also now turning higher off the lows.
Daily:
Dropping into the daily view, we can see the trajectory marked out from a couple of months ago is still playing out, albeit at a slower pace than anticipated, with the bounce off $2400 leading to a strong reversal through the Q4 open and finally through trendline resistance last night. ETH broke firmly above $2707 resistance, which could act as support early this week, but if we do get that slightly deeper retracement in BTC/USD towards $66.6k then it is likely ETH retests $2600 as support this week, where it should look to form a base as prior resistance turned support. Acceptance above $2700 this week will open up that $2850 and 360-day moving average retest from below that we have been anticipating. Close the daily through that level and above that first trendline and it is likely the reversal accelerate into year-end towards $3550 as the first resistance.
ETH/BTC
Weekly:
Looking at ETH/BTC, again very little has changed since last week despite the small green candle, with 0.0383 continuing to act as support whilst price remains capped by 0.0403. As has been my view for a while now, I expect a breakout beyond all-time highs in BTC/USD to mark the lows in ETH/BTC, and I am leaning towards a sweep of 0.0383 into 0.0365 from which point we will see a sharper reversal. Should that sweep not come, we need to see 0.0417 reclaimed as support before getting bullish on ETH/BTC. Patience.
Daily:
Looking at the daily, we can see that price really is just chopping around in this range, with no real sense of momentum in either direction now. It is likely this is because ETH/BTC is sniffing out the likelihood of an imminent breakout for BTC/USD and we should see some real momentum step in after that occurs.
0.0365 or 0.0417 - nothing else to add at present.
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Copper:
Price: $4.46
Thoughts:
Weekly:
If we begin by looking at the weekly for Copper, we can see that price retraced into the area of demand anticipated a couple of weeks ago, presenting a swing long entry last week above $4.32. Price retested the reclaimed support zone around that level and bounced to close the week above prior resistance at $4.36. We should see strength from here, protecting last week's low and marking out a higher-low within this general uptrend, where continuation of the trend should see fresh yearly highs over the coming months. Whilst weekly structure is bullish and the trend remains intact, there is no reason to turn bearish here; lose the 200wMA and turn $4.05 into resistance and the structure shifts dramatically.
Daily:
Turning to the daily, we can see that price is currently front-running the 200dMA retest, and momentum indicators are supportive of a higher-low being marked out here. If we do sweep last week's low, we should look for momentum divergence to form to support the idea of a bottom in this area. If $4.32 does stick as a higher-low here, we should see the 100% extension of the local trend tagged at $5 as the next major resistance. This is really clean price-action and market structure we are seeing from Copper here and this should be constructive for higher prices into 2025.
Dollar Index:
Price: 103.27
Thoughts:
Weekly:
If we begin with the weekly for the Dollar Index, we can see that last week saw DXY push higher into the area of resistance we have anticipated as an upside cap for several weeks now at 103.7, with price rejecting off that area to close the week at 103.15. If we take out last week's high through 103.8 this week and then reject again, that would look very supportive of the idea that this is a local top forming from which we see another leg lower over the coming months. If we close the weekly above 103.8, we are likely to see more headwinds for risk more broadly, with no real resistance back towards 105.4.
Daily:
Looking at the daily, we can see how so far the Dollar has played out perfectly following the expected short squeeze, with the confluence of the 360dMA, 200dMA and prior support now acting as resistance at 103.7. We are not yet seeing trend exhaustion on the daily timeframe (though it is apparent on lower timeframes). If we do take out that high into 103.8 and RSI makes a lower-high, that would provide some confluence for exhaustion into resistance. We would then be looking for a breakdown on the lower timeframes followed by 101.9 turning reclaimed resistance in November to cement this view and the likelihood of fresh lows below 100 into 2025. Close and accept above 103.8 and we have some minor resistance at 104.25, but nothing major until that 105.4 area that has been tapped several times over the past 2 years, which would likely be a drag on risk.
Others:
Price: $231bn (3.37mn BTC)
Thoughts:
OTHERS/USD
Weekly:
Beginning with the weekly for OTHERS, we can see that the altcoin market formed a higher-low above the 200wMA and retested trendline resistance as support, breaking below it briefly only to reclaim it last week. This is promising, and we should now see the final resistance at $238bn give way going into November, which will be the signal for continuation of the longer-term uptrend back towards fresh yearly highs at $367bn. Momentum indicators are turning up here - again much like in October 2023. Whilst we now hold above the 200wMA, trendline resistance and the parabola, there is little reason to be bearish here. Clean close above $240bn and we have clear skies for another 25% rally into $300bn as the next resistance.
Daily:
Turning to the daily, we can see that we remain pressed up against the tightest confluence of resistance left on the chart, with the 200dMA, 360dMA and prior resistance all sat between $228bn and $238bn. Turn this zone into support and mark out a higher-low above it and we are off to the races. For now, alts continue to consolidate below this resistance and momentum indicators have been reset, with daily structure bullish. If we close the daily below last week's low, that would open up a deeper correction back into $200bn to retest that zone as support. Above that, we are bullish.
OTHERS/BTC
Weekly:
Looking at OTHERS/BTC, on the weekly view we can see the market continues to consolidate against Bitcoin between reclaimed support at 3.27mn BTC and support turned resistance at 3.6mn BTC. The view has not changed since last week: a weekly close below 3.275mn would likely leads to a sweep of the summer lows into 3mn and likely some sort of capitulation candle before another attempt at a bottom can be made; a close above 3.6mn and the next wave of altcoin outperformance begins. Much like ETH/BTC, it is likely the altcoin market is waiting in anticipation of confirmation that Bitcoin is in price discovery before it lets its foot off the gas...
Daily:
Finally, looking at the daily timeframe, we can see that there is a sort of inverted head-and-shoulders forming here as a bottoming structure, where 3.275mn acted as support in June, followed by break below and consolidation around the 2023 low at 3mn, leading to a reclaim of 3275mn and now a retest as reclaimed support. If this can hold here this week, it looks likely that ALT/BTC values could front-run a breakout in BTC/USD and push higher through 3.6mn into early November. If not, we have likely got that one final flush ahead before a true bottom can form...
We hope we've provided some value here – good luck with the trading week ahead!
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