Over the last two weeks, we've made the case for short-term caution and patience. This approach has proven timely, with Bitcoin correcting 20% over this period.

As it currently stands, Bitcoin lies on a shelf of support near its most recent pivot lows, around the 18,000, 19,000 neighborhood.

Bearish sentiment seems to be approaching extreme levels, with both Ethereum and Bitcoin quarterlies trading backward.

At the same time, the macro backdrop continues to be a risk-off picture.

The S&P 500 has lost a key level of support, while the US dollar, interest rates, and crude oil all look prime to begin a new leg higher.

This is the video recording of our August 26, 2022, All Star Charts Crypto Weekly Strategy Session.

From the Desk of Louis Sykes @haumicharts

Over the last month, we've been developing a variety of market breadth tools to use in crypto capital markets.

After working out a few technical kinks, we're happy to bring forward more of this analysis.

We recommend you read these two notes on crypto breadth to better understand our approach:

• Considerations for Using Market Breadth in Cryptocurrencies
• Crypto Market Breadth Is Here

Here's a quick rundown on what this analysis seeks to achieve.

It's impossible to ignore legacy markets when evaluating cryptocurrencies.

The two are so intertwined that correlation analysis almost trumps our traditional price analysis.

I hate to say it, but if you want to understand where Bitcoin's going, study the S&P 500 and the US dollar, not the Bitcoin chart.

Late last week, we argued that short-term caution was warranted.

With equities pressing against key supply zones and the dollar beginning to reassert strength, we made the case for patience.

And, over the weekend, we've seen risk-off action persist.

This is the video recording of our August 19, 2022, All Star Charts Crypto Weekly Strategy Session.

One of the big characteristics that often separates great traders from mediocre ones is the willingness and ability to sit on the sidelines when it's necessary.

A brief adage we often mention is the distinction between seeing a setup and looking for one. Be patient, prepare your perfect swing, and the setups will come to you.

From the Desk of Louis Sykes @haumicharts

There's lots of chatter about the Ethereum $ETH merge, and rightfully so.

It's a significant development for the entire space and is paving an ideological divide in the community from proponents of proof-of-work (PoW) to that of proof-of-stake (PoS).

But when it comes to our job as technicians -- that is, following money flow -- we like to sweep the narrative aside and see what's really happening.

And we like to tell it like it is.

Broadly speaking, risk assets have caught a well-received bid over the last few weeks. This recent period has proven to be an incredibly risk-on tape.

When it comes to crypto, the big narrative driving capital markets seems to be the upcoming Ethereum $ETH merge. This update will see the network move away from proof-of-work (PoW) to a proof-of-stake (PoS) framework.

Of course, as technicians, we naturally follow money flow as opposed to getting stuck in the weeds of narratives. It's quite clear to see traders are bidding Ethereum leading into the merge in what looks like a "buy the rumor, sells the news" event.

This is the video recording of our August 12, 2022, All Star Charts Crypto Weekly Strategy Session.

From the Desk of Louis Sykes @haumicharts

In recent weeks, we've found ourselves revisiting the following question: Is Ethereum outperforming Bitcoin a bullish characteristic for the asset class?

We addressed this question a year ago. The conclusion we reached back then was that, while ETH outperforming BTC is not a necessary condition for a bull market, it’s always an encouraging sign when we see it.

In light of the recent disparity in performance between ETH and BTC, we thought we'd re-examine this topic.

Let's get to it.

The cryptocurrency market has certainly seen a nice relief bounce over the last few weeks; the average coin is up a notable 60% off its lows.

With this short-term regime in bull territory, let's evaluate how we're approaching this tape from a tactical perspective.