At the time of typing, a steep sell-off continues in Bitcoin (BTC/USD) and Ethereum (ETH/USD). Typically, I would jump in and accumulate some more of either or both cryptocurrencies. However, after I took a step back to review the charts, I realized Bitcoin and Ethereum are in precarious positions with support melting away. Both cryptocurrencies are entering zones where “natural” support rests significantly lower. This lack of support occurs from the significant breakout and run-up that unfolded in late 2020 and early 2021 with little rest.
So at this point, I am just going to wait patiently and watch this support melting. I do not even think the triggering of the Google Trend Momentum Check (GTMC) will draw me in. The current sell-off creates new overhang. Any bounce from these depths will likely hit a wall of relieved sellers around the point of this past weekend’s breakdown. The good news is that a breakout above this wave of selling should deliver a significantly bullish signal.
Be careful out there!
Full disclosure: long BTC/USD, long ETH/USD