This blog references an opinion and is for entertainment and informational purposes only. It is not intended to be investment advice. Seek a duly licensed professional for investment advice.
In this 37th 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, DXY and altcoins via OTHERS.
Firstly, let's take a look at the calendar, with a hugely important week ahead:
MONDAY: US ISM MANUFACTURING PMI (MAY): (CONSENSUS 49.5 VS PREVIOUS 48.7)
MONDAY: FED CHAIR POWELL SPEECH
TUESDAY: BOJ UEDA SPEECH
TUESDAY: US FACTORY ORDERS (MOM) (APR): (CONSENSUS -3% VS PREVIOUS 3.4%)
TUESDAY: US JOLTS JOB OPENINGS (APR): (CONSENSUS 7.1M VS PREVIOUS 7.192M)
WEDNESDAY: US ADP EMPLOYMENT CHANGE: (CONSENSUS 115K VS PREVIOUS 62K)
WEDNESDAY: BOC INTEREST DATE DECISION: (CONSENSUS 2.75% VS PREVIOUS 2.75%)
WEDNESDAY: US ISM SERVICES PMI (MAY): (CONSENSUS 52 VS PREVIOUS 51.6)
THURSDAY: ECB INTEREST RATE DECISION: (CONSENSUS 2.15% VS PREVIOUS 2.4%)
THURSDAY: US INITIAL JOBLESS CLAIMS: (CONSENSUS 235K VS PREVIOUS 240K)
FRIDAY: US NONFARM PAYROLLS (MAY): (CONSENSUS 130K VS PREVIOUS 177K)
Now, let's dig into asset-specific price-action for the week ahead, looking firstly at Bitcoin:
Bitcoin:
Price: $104,730
Monthly:
If we begin by looking at BTC/USD on the monthly, we can see that May finished up at a new all-time high monthly close at $104.6k, having wicked into fresh all-time highs at $112k. Market structure on this timeframe is bullish and momentum is likely to kick into a higher gear here if June can build on May, as I am expecting it to. To outline the more bearish outcome, however, a monthly close in June back below $100kish would not look good, giving more weight to the formation of bearish divergences and a failed breakout on the higher timeframes; if instead $100k acts as support in June and we push through $112k, I would expect to see $124xxx tagged at some point this month, with some sort of extension into July that could mark a top, but we would need to see how price-action, positioning and sentiment shape up at the end of this quarter.
Weekly:
Looking at the weekly, we can see that price pushed into $112k a couple of weeks ago, closing firmly above prior all-time highs at $109.4k and then rejecting at the highs last week, forming an inside week with price holding above that prior weekly low; thus, taking out last week's low and then closing back above it gives us inside week failure, which, should it form, provides some confluence for another attempt at all-time highs the following week. Now, if we close this week below last week's low, we likely retest that all-important $99k level next week, where if that gives way the expectations for a strong June diminish significantly in my view, and we then are more likely to trade lower towards even $89k to attempt the formation of a higher-low above that level on this timeframe. Assuming $99k holds as reclaimed support, we should then take another stab at $112k next week, where any weekly close above that in mid-June = expansion higher into the end of Q2. Momentum is still nowhere near the extremes of the prior two major tops of this cycle, so plenty of room for upside on that front.
Daily:
Turning now to the daily, we can see that we had no real trend exhaustion into that all-time high, but instead had decent volume on the breakout and daily RSI putting in a fresh high, but late longs getting immediately trapped on the breakout and price closing back below $109.4k. We have since made a lower-high and a lower-low but remain above that key structural support around $99k - the range that preceded the breakout candles. We have retraced towards that support cluster, finding a low late last week around $104k, which is a big level, and I think there's a good chance that if we take out those lows early this week into that range between $99k-$102.5k, that's your golden opportunity for the next run at the highs. Flipping $99k as support turned resistance would be your signal that this is not likely to play out, at least short-term, and we then likely trade into the 200dMA at $94.9k at least, with that cluster of support below around the 2025 open and reclaimed range support. On the bullish side, a daily close back above $109.4k would open up the next leg higher into price discovery.
Now, looking at setups for the week ahead, kind of building on last week's idea of weakness into early June, bulls want to see a grind lower early this week, leaving lots of unswept highs intraday and price to capitulate through last week's low and then reclaim it as support. I have missed a little green arrow there, but you could look to begin laddering bids on a reclaim of $103k, then add back above the June open and more on a trendline breakout and weekly open reclaim at $105.7k, invalidation being a daily close below $99k:
I don't really like much by way of shorts down here given the retracement we've already had off the highs, but if we hold above the weekend lows (this is critical), and grind higher into mid-week, pushing above trendline resistance and immediately trapping those breakout longs, I would like shorts on a breakdown back below $106.7k, adding below the weekly open and looking for $102.5k to be tagged, with scope for that $100.7k low to then be swept before a bottom is found next week. As I say, this isn't necessarily the nicest setup:
And here's a snapshot of positioning across Velo and CoinGlass:
And here's 3-month annualized basis:
And Bitcoin OI vs Altcoin OI:
And finally some of the expected 1-week and 1-month liquidation levels:
Ethereum:
Price: $2483
ETH/USD
Monthly:
If we begin by looking at ETH/USD on the monthly, we can see that May was a very strong month indeed, building on the bounce off the April lows and confirming a monthly swing-low above that 2018 high at $1420. Price rallied off the May open all the way back above the multi-year pivot at $2158, pushing into $2850, where it rejected and closed marginally below the Q4 open at $2600. We are now in such an interest area for Ethereum, as we have reclaimed a huge cluster of support levels and put in a monthly swing-low, whilst remaining below multi-year trendline support turned resistance and still very much having bearish monthly structure. This is truly make or break time for ETH, and if it is going to push on for a retest of the $4xxx area anytime soon we should see June close above this cluster of resistance, with acceptance above $3050 likely leading to the all-time high being retested, in my view. If, instead, we wick above $2850 and reject in June, then closing back below $2600, that looks like it wants lower - but we have that massive cluster of reclaimed support below between $2158-$2281. In short, ETH is now in no man's land and June will likely dictate much.
Weekly:
If we look at the weekly, we swept the highs into support turned resistance at $2850 and rejected, closing a fourth consecutive week below $2600. This indicates that we may need to move lower this week to fuel another attempt at a breakout, in which case we may see that 2024 open at $2281 retested early in June before $2850 is attempted again. A weekly close above $2850 leaves only one major level of resistance before a retest of the 2024 highs at $4100, so that really is a key level to overcome this month. If we see weakness on any retest of $2281 and close back below it, ETH bulls have one final level at $2158 to save the day - flip that into resistance again after such a strong impulse back above it and we're retesting the 360wMA at $1633.
Daily:
Dropping into the daily, we can see the potential early June trajectory, with weakness leading to a sweep of the lows into the 2024 open before marching higher into the $2600 level again, where acceptance above that level will be the first clue that the $2850-$3050 range is going to be tested once more; as such, buying $2281 if we get it with invalidation on a close back below $2158 makes sense, with a view to hold at least for $2600. I am expecting to see $3050 tested at least once in June from here as long as we hold above $2158, and the reaction there will dictate whether we run 2024 highs or collapse again. Not much else to add for now...
ETH/BTC
Monthly:
Looking at ETH/BTC on the monthly, we can see that the pair closed its first green month of 2025, eclipsing the April highs and closing back above that key 0.023 level on this higher timeframe. Obviously, momentum, structure etc. are still bearish here, but this is the first sign of promise for the pair in a long time. If this is truly the turning point, June should build on this momentum, with 0.023 acting as support and price retesting 0.0295, with any close above that level opening up 0.0365 as the next major target. Close June below 0.023 and this was a fakeout in a long-term downtrend and we are headed for new lows and likely to retest that 2019 low in Q3.
Weekly:
Turning now to the weekly, we have been consolidating above 0.023 for a few weeks now and momentum remains in a downtrend despite that impulse higher in May. If after several weeks of consolidation above reclaimed support the pair cannot hold this here and flips the level back into resistance, it's not looking good for ETH bulls. Whilst we remain above the level, however, I do think it is more likely this consolidation resolves higher by testing 0.0294. Only with acceptance above that level does weekly structure turn bullish, and likely momentum confirms a reversal on that too. Big couple of weeks here for ETH/BTC...
Daily:
Finally, looking at ETH/BTC, we can see that price rejected 0.0264 again and moved lower, but remains firmly above prior support. I did expect it to wick below all these lows before v-reversing off 0.0215, and that may still yet occur early this month. If we do see 0.023 swept, bulls need to show up with force so that we don't flip that level into reclaimed resistance, from which we would be more likely to give back much of this rally back into 0.0187. If we catch a bid here going into mid-June, I think 0.0295 gets flipped as support, along with the 200dMA, and the pair rallies into July, with 0.0365 as the major target for that swing.
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DXY:
Price: $98.3
Monthly:
Looking at the Dollar Index, on the monthly timeframe we can see how, despite an attempt at a push higher in May, price rejected hard at the 2024 open and closed May right at multi-year lows, closing marginally below the April low and confirming a breakdown below the range, though we do have an inside month formation. Momentum looks awful here for the Dollar, and from this higher timeframe POV my expectations of a short-term bounce are looking less likely, with a higher probability of us speed-running the last leg lower in the Dollar bear cycle here, where I would be looking for anything between 93-95 to be tagged in Q3. This will be where I expect the Dollar weakness to run its course and a new accumulation range to form above that 200wMA - remember that we are in multi-decade Dollar bull run at this point and I am not anticipating its end here. From a positioning and sentiment perspective, we know that continued Dollar weakness is consensus.
Weekly:
Looking at the weekly, we can see just how perfectly the Trump 2016 fractal played out, and that rejection a few weeks ago is looking more and more like the last gasp before capitulation lower. We are still marginally above the yearly lows but we continue to flip local support as resistance, which is not conducive to a local bottoming pattern here. We still have some marginal probability of bearish divergence here if the Dollar can put in a low this week, but if we get a weekly close below 97.5 I think any potential trend exhaustion to the downside is invalidated and we push for 94.7 over the subsequent weeks.
Daily:
Looking now at the daily, we can see what I marked out last week as the potential bottoming pattern before a push for 102ish in June, where I would expect the downtrend to step in and push this lower again later this year. Right now, it's looking much more likely that the Dollar wants lower, with the May open turning resistance and price now firmly below range lows. We need to see 97.5 flipped into resistance on the daily for this to be confirmed as the beginning of the next leg lower. If the bulls want any semblance of control, we need to see DXY reclaim 99.3 as support, where marking out a higher-low above that and then breaking above 100.4 turns daily structure bullish and would lead to that squeeze into 102 later this month. For now, it looks like we're about to enter the latter innings of the Dollar bear, which itself has implications for risk appetite going into year-end.
Others:
Price: $242bn
OTHERS/USD
Monthly:
If we begin by looking at the monthly for OTHERS, we can see that May closed marginally green after wicking higher off that open into $298bn, ultimately retracing much of that rally to close at $244bn. Nonetheless, the monthly has now confirmed a swing-low - and more importantly a higher-low above the 2024 lows. We should now see June build on this and find support above $235bn, with a likelihood that we then retest the 2025 open at $325bn. If this is a fake-out and we are due to move lower, potentially ending the multi-year uptrend, June will close below $235bn and we would then expect alts to continue lower towards $190bn from there to retest that support. For now, on this timeframe we have bullish structure - but a lot hinges on June.
Weekly:
Now, turning to the weekly, we have bullish structure on this timeframe too following the breakout and close above both trendline resistance from the 2024 highs and above that prior lower-high at $242bn. Momentum looks similar here to Q4 2023 and Q4 2024, but again much hinges on price now marking out a higher-low (likely above the 200wMA at $212bn) and then pushing into higher-highs above $300bn from there, which would lead to expansion into that yearly open and the March 2024 highs beyond that as the first major test. If we look at price-history, the $225bn area has been an important pivot, and if OTHERS can hold above that area early in June I think by mid-June we're retesting that May high. Closing the weekly below that level and then likely losing the 200wMA would undo much of the strength from the lows and it would then become more probable that $177bn gets retested as major support, where any close below that level looks uber-bearish, opening up the 360wMA retest at $140bn. For now, again this still looks bullish...
Daily:
Dropping into the daily, we can see a potential trajectory here following the April/May squiggly, where we take out the local lows into the May open and v-reverse off that area hard into end of Q2, with $335bn being the June target if that higher-low in this trend can stick. We've reset momentum fully here but we need to see buyers step in over the next week or so if this reversal has legs. Flip the May open at $225bn as resistance and this all looks a lot worse structurally, and I would look to close out some altcoin positioning and either await a reclaim of that level as support or wait for much lower prices from there.
OTHERS/BTC
Monthly:
Beginning with the monthly for OTHERS/BTC, May was another weak month for altcoin outperformance, with momentum starting to flatten out but prices rejecting off prior support at 2.8mn BTC and moving lower into 2.26mn BTC. This was marginally below that February low - so we can now say that I was wrong to say that OTHERS/BTC had bottomed on that capitulation candle in February. So, where to now? Well, we are trading in no man's land here, with no technical support for alts vs BTC for another 40% lower but no current signs of significant expansion to the downside; even with all that vol trading in May we barely broke the Feb lows. But weekly structure is bearish and we do have bearish momentum, so the expectations of breadth improving in alts is currently unlikely. Rather, as has been the case all cycle, your selection is paramount to your success, and even if we get strength in Dollar terms as per the OTHERS chart, it's not looking probable that June sees broader outperformance vs BTC. This picture changes drastically if and when we reclaim that initial 2023 bottom at ~3mn BTC as support. Until then, be very very careful with your alt allocations...
Weekly:
Now, looking at the weekly, we have had trend exhaustion time and time again for alts vs BTC but nothing major has come from it as of yet, with that very weak period of outperformance in Q4 the last hurrah. We are now just consolidating between 2.38mn BTC and 2.83mn BTC, having marginally broke below that support last week. If that range support acts as resistance this week, we move lower and deeper into no man's land; as I mentioned above, there is no technical support on this chart until 1.425mn BTC. If, however, we reclaim local range support this week, there is a chance that late May weakness is indeed a fake out, but until we flip 3mn BTC as support I would continue to be much more selective on alts - some alts are looking very decent, with uptrends intact and higher-lows forming; some not so much. OTHERS/BTC rallying significantly higher is what you need for that breadth of outperformance to occur, where even the previously underperforming alts see strength - this will only happen above that 3mn BTC level. In order for this to happen with a greater likelihood, I think we need to see business cycle momentum worldwide pick up again (and US momentum build on Q2), we need to see more Dollar weakness and we need to see the delta between Global M2 and Global GDP continue to grow (as it has been doing recently) - if we get all three, I would be very confident OTHERS/BTC doesn't just chop around at the lows but alts outperform BTC hard into the back end of the year. Until then, only the strongest will accrue all of the gains.
Daily:
Finally, looking at the daily, we can see how choppy price-action is, as well as momentum, with that mid-May rally turning daily structure bullish but rejecting at 2.83mn BTC, with OTHERS/BTC retracing all of that rally into the end of May, now sat at the local lows. I do think looking at this that the next time we accept above that 2.62mn BTC level it will not be a fake-out, and OTHERS/BTC will continue from there through 2.83mn BTC into the major test at 3mn BTC, where the 200dMA is also sat. That will be the make or break area for a period of sustained outperformance. Not much else to add here for the time being...
I hope you've found some value in the read this week!
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