Bitcoin and its buddies have turned bullish in the past few days, but it looks like the rallies are starting to lose steam. What do the charts have to say?
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Check out this ranking of bitcoin and its buddies for the past seven days:
All green, baby! Bitcoin Cash is leading the pack with a stellar 37.95% gain while BTC is in second place at 25.67%.
Bitcoin bulls were able to charge past the descending trend line visible on the long-term time frames to signal that a reversal from the selloff is due. However, price has stalled around the area of interest at $10,000 so a pullback might take place first.
Applying the handy-dandy Fib tool on the breakout move shows that the 50% level is close to the broken trend line while the 61.8% level coincides with another area of interest.
The 100 SMA just crossed above the slower-moving 200 SMA to confirm that buyers are taking control, but stochastic has some room to head south before reflecting oversold conditions.
Ethereum is in the middle of a downtrend as it cruises inside a descending channel on the 4-hour time frame. Price might be in for a few gains, though, as it crossed the mid-channel area of interest and is setting its sights on the channel resistance around $200.Stochastic is also pointing up, but the oscillator is already approaching the overbought zone to signal exhaustion among bulls. The moving averages are merely oscillating to reflect consolidation.
The trend strength analysis on MarketMilk™ shows that ETH is just starting to turn long-term bullish, which could mean that it might have even more gains up its sleeve.
Litecoin has also been trending lower inside a falling channel on its 4-hour time frame, but price might be considering a break from the slide. A bullish flag seems to have formed right at the channel resistance, and a candle closing above the $60 mark could be enough to indicate that a reversal would come next.
However, stochastic is pointing down to suggest that bears still have the upper hand and could take price back down to the channel support or at least until the recent lows. The 100 SMA is below the 200 SMA as well.
XRP might be in for a reversal from its selloff as price formed a double bottom pattern and looks ready to test the neckline at 0.3100. Climbing past this resistance level could spur a rally that’s the same height as the reversal formation.
Technical indicators are giving mixed signals as the 100 SMA is increasing its lead above the 200 SMA but stochastic is already turning lower from the overbought zone.
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!