Bitcoin and its cryptocurrency buddies have been on a tear these days, so I thought I’d have a rundown of potential tech plays on BTC/USD, ETH/USD, and LTC/USD.
Don’t look now but bitcoin is edging close to its all-time highs at $4,964.77, which could be an excellent level for bulls to book some profits. Stochastic looks ready to head south to reflect a return in bearish pressure after all.
The 100 SMA recently crossed above the longer-term 200 SMA, though, so bullish momentum could stay in play and trigger an upside break from the $5,000 psych barrier. A quick pullback to the nearby support at the bottom of the short-term ascending channel around $4,500 could be needed for bulls to gain more energy before attempting to surge past the ceiling.
Volatility has taken a bit of a hit in the past few weeks after China moved to shut down bitcoin exchanges in the country, but investors appear hopeful that the next bitcoin upgrade in November could elicit a similar price reaction to the previous one in August.
Ethereum is also trending higher and is moving inside a rising wedge pattern on its 1-hour time frame. Price just bounced off support and may be setting its sights back on the wedge resistance around $320.
Stochastic is heading north so price could follow suit while bulls stay on top of their game. At the same time, the 100 SMA is above the longer-term 200 SMA to suggest that there’s enough momentum for a move towards the resistance.
A breakout doesn’t seem imminent for now as price could keep bouncing back and forth between the wedge support and resistance while it approaches the peak of the formation. Keep in mind, however, that ethereum is moving closer to a “hard fork” or its next major update called Byzantium.
Meanwhile, bitcoin rival litecoin appears to be having a rougher time following China’s crackdown on ICO offerings and cryptocurrency exchanges. LTC/USD has been forming lower highs and higher lows, consolidating inside a symmetrical triangle on its 1-hour time frame.
Price has just bounced off the resistance and is making its way towards the middle of the triangle, right in line with the dynamic inflection points at the moving averages. Busting through this roadblock could take price up to the triangle resistance but failing to do so could lead to another test of support.
Stochastic is on the move up to show that buyers still have some gas left, but the oscillator is also stepping into the oversold region to signal rally exhaustion.