Are the crypto rallies about to resume? I’m seeing some upside breakouts on some charts and a bit more consolidation on others. Take a look!
Bitcoin broke out of the triangle pattern we were watching last week and also above the neckline of a double bottom formation. Are bulls getting warmed up?
It looks like a correction might be needed before more buyers join in as price is retreating to the 38.2% Fibonacci retracement level around $11,000. A larger correction could last until the 50% Fib that lines up with an area of interest or the 61.8% level at $10,338.31.
Bullish momentum might pick up from here as stochastic has dipped into the oversold region and could turn higher again. At the same time, the 100 SMA is above the 200 SMA to confirm that the climb is likely to gain traction.
Ethereum also enjoyed an upside breakout of its own, confirming that bulls have won this round. However, price might need a quick retest of the broken triangle top before heading north.
The 100 SMA is still below the 200 SMA to indicate that the path of least resistance is to the downside while stochastic is heading south, so price might follow suit.
The pullback might last until the 50% retracement level near the triangle resistance or the 61.8% Fib that lines up with the 200 SMA dynamic inflection point.
Litecoin is still stuck inside its symmetrical triangle pattern on the 4-hour time frame after getting rejected at the resistance. Another test of support is taking place, and technical indicators are hinting at a bounce.
Stochastic is already indicating oversold conditions and is turning higher to show that buyers are ready to defend support. The 100 SMA is above the 200 SMA for now, but the gap has narrowed enough to signal a likely bearish crossover.
If that happens, bears could find enough energy to bust through support and spur a drop that’s the same height as the triangle formation.
XRP is cruising higher inside an ascending channel with its higher lows and higher highs on the 1-hour time frame. Price could be due for a bounce off this 0.3100 mark as stochastic looks ready to pull up from the oversold region.
At the same time, the 100 SMA is above the longer-term 200 SMA to indicate that the path of least resistance is to the upside. In other words, the climb is more likely to resume than to reverse.
In that case, XRP could recover to the top of the channel around 0.3250 or at least until the mid-channel area of interest close to .3175 and the dynamic inflection points at the moving averages.
Just be warned, there is a considerable amount of risk in trading cryptocurrencies due to their inherent volatility and sensitivity to headlines. Be careful out there!