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Monday, March 4, 2024

The Market’s Compass Crypto Candy Sixteen Research


Welcome to this week’s publication of the Market’s Compass Crypto Candy Sixteen Research. The Research tracks the technical situation of sixteen of the bigger market cap cryptocurrencies. I’ve compiled the historic quantitative goal technical rating information and secondary technical indicators together with the Candy Sixteen Complete Technical Rankings and Weekly Common Technical Rating again to October of 2021. Each week the Research will spotlight the technical adjustments of the 16 cryptocurrencies that I monitor in addition to particular person highlights on noteworthy strikes in sure cryptocurrencies and Indexes.

The Excel spreadsheet beneath signifies the weekly change within the goal Technical Rating (“TR”) of every particular person Cryptocurrency. The technical rating or scoring system is a wholly quantitative method that makes use of a number of technical concerns that embrace however should not restricted to pattern, momentum, measurements of accumulation/distribution and relative energy. If a person Cryptocurrency’s technical situation improves the Technical Rating (“TR”) rises, and conversely, if the technical situation continues to deteriorate, the TR falls. The TR of every particular person Cryptocurrency can vary from 0 to 50. The spreadsheet beneath additionally acts as a “warmth map” in that, cryptocurrencies with a TR within the vary of 1 to fifteen are highlighted in purple, 15.5 to 34.5 are famous in blue and TRs within the vary of 35 to 50 are in inexperienced. The first take-away from this unfold sheet ought to be the pattern of the person TRs, both the continued enchancment or deterioration, in addition to a change in path. A sustained pattern change must unfold within the particular person TRs for it to be actionable. Secondarily a really low rating can sign an oversold situation and conversely a continued very excessive quantity will be considered as an overbought situation however, as we all know, over offered situations can proceed at apace and overbought securities which have exhibited extraordinary momentum can simply change into extra overbought. Thirdly, the weekly TRs are a invaluable relative energy/weak point indicator vs. one another, as well as when the Candy Sixteen Complete Technical Rating (“SSTTR”), that has a spread of 0 to 800, is close to the underside of its vary and a person cryptocurrency has a TR that is still elevated it speaks to relative energy. Conversely if the SSTTR is close to the highest of its current vary and a person cryptocurrency has a TR that is still mired at low ranges it speaks to relative weak point. Lastly I view the target Technical Rankings as a place to begin in my evaluation and it isn’t your entire “finish sport”.

This Week’s and 10 Week Trailing Technical Rankings of the 16 Particular person Cryptocurrencies*

*Rankings are calculated as much as the week ending Friday September 1st

The SSTTR fell to 167 from the earlier weeks 200 studying. Final week’s studying within the SSTTR was the bottom studying because the week ending June sixteenth at 157.5.

On every week over week foundation six cryptocurrencies registered beneficial properties of their Technical Rankings one was unchanged and 9 fell. The typical Technical Rating loss was -2.06. Three of the Candy Sixteen ended the week within the “blue zone” (TRs between 15.5 and 34.5) and 13 ended the week within the “purple zone” (TRs between 1 and 15). The earlier week there have been 4 of the Candy Sixteen within the “blue zone” and twelve have been within the “purple zone”. Tron (TRX) and Steller (XLM) dropped probably the most “handles” (-10 and -8 respectively) however each remained within the “blue zone”.

Relative Power and Weak point within the Candy Sixteen vs. The CCi30 Index* using a Relative Rotation Graph

*The CCi30 Index is a registered trademark and was created and is maintained by an impartial group of mathematicians, quants and fund managers lead by Igor Rivin. It’s is a rules-based index designed to objectively measure the general progress, day by day and long-term motion of the blockchain sector. It does so by indexing the 30 largest cryptocurrencies by market capitalization, excluding secure cash (extra particulars will be discovered at CCi30.com).

The Relative Rotation Graph, generally known as RRGs have been developed in 2004-2005 by Julius de Kempenaer. These charts are a novel visualization software for relative energy evaluation. Chartists can use RRGs to research the relative energy traits of a number of securities towards a standard benchmark, (on this case the CCi30 Index) and towards one another over any given time interval (within the case beneath, day by day because the finish of the earlier week). The facility of RRG is its capacity to plot relative efficiency on one graph and present true rotation. All RRGs charts use 4 quadrants to outline the 4 phases of a relative pattern. The Optuma RRG charts makes use of, From Main (in inexperienced) to Weakening (in yellow) to Lagging (in pink) to Bettering (in blue) and again to Main (in inexperienced). True rotations will be seen as securities transfer from one quadrant to the opposite over time. That is solely a short clarification of easy methods to interpret RRG charts. To study extra, see the put up scripts and hyperlinks on the finish of this Weblog.

In final week’s Crypto Candy Sixteen Research (#100) I introduced consideration to TRON (TRX) which was monitoring greater within the Main Quadrant. It has since “rolled over” and is monitoring decrease and is coming into the Weakening Quadrant. Stellar (XLM) additionally has additionally rolled over earlier than reaching Main Quadrant. I’m intently watching Litecoin (LTC) and Ripple (XRP). Each are in what I prefer to check with because the Bettering Quadrant “candy spot”, however the relative energy momentum is slowing (they’re beginning to monitor sideways) and that’s causeing me to mood my enthusiasm. Dogecoin (DOGE) is beginning to present indicators of life because it tracks greater within the Bettering Quadrant.

Seven Day Absolute % Worth Change*

*Friday August twenty fifth to Friday September 1st

Twelve of the Candy Sixteen underperformed the CCi30 Index. The typical 7-day absolute loss was -3.15%

The Technical Situation Issue adjustments for the week ending August 18th and trailing ten weeks.

There are eight Technical Situation Elements (“TCFs”) that decide particular person TR scores (0-50). Every of those 8, ask goal technical questions (see the spreadsheet posted above). If a technical query is optimistic an extra level is added to the person TR. Conversely if the technical query is destructive, it receives a “0”. Just a few TCFs carry extra weight than the others such because the Weekly Pattern Issue and the Weekly Momentum Think about compiling every particular person TR of every of the 16 Cryptocurrencies. Due to that, the excel sheet above calculates every issue’s weekly studying as a p.c of the doable complete. For instance, there are 7 concerns (or questions) within the Day by day Momentum Technical Situation Issue (“DMTCF”) of the 16 Cryptocurrencies ETFs (or 7 X 16) for a doable vary of 0-112 if all 16 had fulfilled the DMTCF standards the studying could be 112 or 100%. A DMTCF studying at 85% and above suggests a short-term overbought situation is growing and a studying of 15% and beneath suggests a short-term oversold situation.

Three weeks in the past the DMTCF fell to an oversold excessive of 0.00%. I’ve by no means seen as deep an oversold situation as that studying (couldn’t get any decrease). On the finish of final week the DMTCF rose to 37.50% or 42 out of a doable 112. That was a enchancment over the prior week’s studying of 27.68%.

As a affirmation software, if all eight TCFs enhance on every week over week foundation, extra of the 16 Cryptocurrencies are bettering internally on a technical foundation, confirming a broader market transfer greater (consider an advance/decline calculation). Conversely, if extra of the TCFs fall on every week over week foundation, extra of the “Cryptos” are deteriorating on a technical foundation confirming the broader market transfer decrease. Final week six TCFs fell and solely two TCFs rose exemplifying the present malaise that has beset the broader cryptocurrency market.

The CCi30 Index with This Week’s Candy Sixteen Complete Technical Rating “SSTTR” Overlaid

The Candy Sixteen Complete Technical Rating (“SSTTR”) Indicator is a complete of all 16 Cryptocurrency rankings and will be checked out as a affirmation/divergence indicator in addition to an overbought / oversold indicator. As a affirmation/divergence software: If the broader market as measured by the CCi30 Index continues to rally with out a commensurate transfer or greater transfer within the SSTTR the continued rally within the CCi30 Index turns into more and more in jeopardy. Conversely, if the CCi30 Index continues to print decrease lows and there may be little change or a constructing enchancment within the SSTTR a optimistic divergence is registered. That is, in a style, is sort of a conventional A/D Line. As an overbought/oversold indicator: The nearer the SSTTR will get to the 800 stage (all 16 Cryptocurrencies having a TR of fifty) “issues can’t get a lot better technically” and a rising quantity particular person Crypto’s have change into “stretched” there may be extra of an opportunity of a pullback within the CCi30. On the flip facet the nearer to an excessive low “issues can’t get a lot worse technically” and a rising variety of Crypto’s are “washed out technically” and an oversold rally or measurable low is nearer to being in place. The 13-week exponential shifting common in Purple smooths the unstable SSTTR readings and analytically is a greater indicator of pattern (I’ve switched to an exponential shifting common from a easy shifting common on this weeks Research).

Final Tuesday the CCi30 Index spiked greater in a brief squeeze on the Greyscale information. I warned those that comply with me on X that they need to not let the FOMO satan take management of their feelings and that they need to wait to see if there was a comply with by way of to the impulsive transfer. The rally failed on the underside of the Decrease Warning Line (gold dashed line) of the Schiff Modified Pitchfork (gold P1-P3) and over the course of the three days that adopted, the index retraced your entire rally (after which some). That worth motion drove the SSTTR to the bottom stage since June sixteenth. MACD is monitoring quietly decrease in destructive territory underneath its sign line. The one technical function that the “base constructing camp”, of which we’re cautiously one, can discover solace in is that key help on the 6,580 has not been violated.

The CCi30 Index Weekly Cloud Mannequin with the Common Candy Sixteen Technical Rating (ASSTR)

Final Tuesday’s brief squeeze rally failed on the Median Line (purple dotted line) of the Schiff Modified Pitchfork (purple P1-P3). In doing so the CCi30 Index failed to carry onto the bottom within the Cloud and closed decrease on the week. The ASSTR has fallen to an oversold stage the has led to at the very least a counter pattern rally however the worth motion has but to endorse that.

The Candy Sixteen Index*

*The Candy Sixteen Index is comprised of the bigger market cap cryptocurrencies that we monitor on this Weblog

Final week my Candy Sixteen Index fell beneath the Median Line (gold dotted line) of the Schiff Modified Pitchfork (gold P1-P3) that I first utilized to the Day by day chart in July. The Index is attempting to hook greater however the worth transfer shouldn’t be endorsed by the primary mover oscillator, the Fisher Remodel, which has turned decrease by way of its sign line. The Candy Sixteen Day by day Momentum / Breadth did spike greater final week nevertheless it has retraced most of that transfer and is again to simply beneath impartial. I’m not compelled to do something right here.

12 months to Date Relative Comparability

Charts are courtesy of Optuma whose charting software program allows anybody to visualise any information together with RRG Charts and our Goal Technical Rankings. Cryptocurrency worth information is courtesy of Cryptowatch.

The next hyperlinks are an introduction and an in depth tutorial on RRG Charts…

https://www.optuma.com/movies/introduction-to-rrg/

https://www.optuma.com/movies/optuma-webinar-2-rrgs/

To obtain a 30-day trial of Optuma charting software program go to…

www.optuma.com/TMC.

A 3 half tutorial collection on Andrews Pitchfork could also be learn at my web page…. www.themarketscompass.com

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