•  The main altcoins have taken a step back today, ceding leadership to the King of Crypto.

•  Bitcoin (BTC, Tech/Adoption Grade “A-”), after nearly topping its all-time high yesterday, is testing it again today.

•  Ethereum (ETH, Tech/Adoption Grade “A-”) dropped slightly today and is down almost 5% from the high mark yesterday.

Bitcoin is struggling a bit to crack $57,000, but still, the King of Crypto is just $1,000 shy of a new all-time high.

It feels like the whole cryptocurrency market is waiting to see what the King does next.

We may see a period of relative calm for the rest of the market while BTC trades between its 21-day moving average and its previous peak. A break above the high could send bullish ripples throughout the entire industry. Once $58,000 is breached, the next key level is $60,000.

Now, if Bitcoin drops below its moving average, we’d be looking at a “double-top” formation on its chart. That could be a warning sign of a longer (perhaps weeks, perhaps months) correction before the next leg of the bull cycle.

Here’s BTC in U.S. dollar terms via Coinbase:

Ethereum hit a high around $1,875 yesterday before dropping 8% to lows around $1,725. It’s stabilized right around $1,800.

ETH failing to break $1,900 is a disconcerting sign. Now, we’re watching to make sure it holds above its 21-day moving average yet again.

The new institutional money in the space is focused on Bitcoin and has yet to really start to flow into Ethereum and other major altcoins yet. Most of the money in ETH is coming from retail traders now.

This combination of factors suggests we won’t see large inflows into ETH until BTC establishes a firm direction. Of course, we’d like to have our answer soon. Better yet, we might see some decoupling between BTC and ETH.

In the meantime, we’re watching both ETH’s previous high-water mark at $2,000 as well as its 21-day moving average. 

Here’s ETH in U.S. dollar terms via Coinbase:

After starting off the year red hot, Cardano (ADA, Tech/Adoption Grade “B-”) appears to be cooling off lately. Since hitting its high of $1.55, ADA has reverted back to its 21-day moving average, trading right at that level for eight days now.

Today, it slipped just below that metric and is showing some signs of weakness now. The $1.00 level should act as downside support, as $1.20 has acted as stiff resistance over the last week. ADA might be overdue for a cooling off period, so take note if you have an open long position.

Here’s ADA in U.S. dollar terms via Binance:

Notable News, Notes and Tweets

•  Tyler Winklevoss, assessing the $1.9 trillion stimulus, shares a thought on how people will spend their stimulus checks.

•  Pomp, perhaps also assessing the latest round of fiat-fueled largesse, wonders in a way what might happen to inflation.

•  Michael Saylor, channeling one of the greats, philosophizes about Bitcoin.

What’s Next

The recent recovery from the late-February correction has been swift and sharp. Most coins were down 20% to 30% but are already close to breaking all-time highs again.

Even with this speedy recovery, though, we’re not completely out of the woods yet, as evidenced by today’s market action. 

The bullish thesis isn’t completely confirmed until Bitcoin breaks its all-time high again. If the King of Crypto fails to do so, it could send the entire cryptocurrency market into a tailspin. The key takeaway here is that the market is in a bit of technical limbo until BTC makes up its mind.

Stay tuned for updates and insights on this developing story.

Best,

Alex