Bitcoin and its peers had a pretty stellar 2017, but it looks like some members of the cryptocurrency gang are lagging behind. Are these mere retracements or the start of reversals?
Bitcoin has stalled since its failed attempt to break past the $20,000 barrier, forming what appears to be a classic reversal pattern on its 4-hour chart.
A head and shoulders formation can be seen, with price still bouncing off the neckline around the $12,800 to $13,000 levels. A break below this support zone could lead to a drop of around $7,000 or the same height as the chart pattern.
Stochastic is pointing up to show that buyers are still in control, though, while the 100 SMA above the longer-term 200 SMA also suggests that the path of least resistance is to the upside. Hodling might not be such a terrible idea after all!
Ethereum is still holding its ground, moving inside an ascending channel and currently testing the resistance. A bit of a bullish flag can be seen, and this is often considered a continuation signal.
However, stochastic is making its way down from the overbought region to signal a pickup in selling pressure and a potential dip back to the channel support or area of interest around the middle.
As for the moving averages, the 100 SMA is starting to make an upward crossover. If bulls are strong enough to sustain the momentum, an upside break from the $920 resistance could spur an even steeper climb!
The tide has turned for litecoin after its founder Charlie Lee recently liquidated his own holdings, citing conflict of interest as his main reason.
Litecoin is now trading below a descending trend line and is pulling up for a retest. The 100 SMA is above the longer-term 200 SMA, but a downward crossover appears to be brewing.
In addition, stochastic has formed higher highs while price showed lower highs, creating a bearish divergence. Although litecoin has moved past the 61.8% Fib, the trend line could still keep gains at bay and push price back to the swing low.
After recently breaking below a symmetrical triangle formation, IOTA carried on with its slump to the dollar. Price is pulling up from its dive and is currently hitting a ceiling at the former support zone.This coincides with the 50% Fibonacci retracement level, which adds to its strength as resistance. A larger correction could still last until the 61.8% Fib, which is closer to the moving averages, as stochastic has a bit more room to climb.
These indicators are still oscillating to reflect consolidation, though, but the short-term MA looks prime for a downward crossover.
A bit of fair warning, though. As Fed head honcho Yellen cautioned, bitcoin is a highly speculative asset and is not legal tender, which means that there is a considerable amount of risk in trading cryptocurrencies. Be careful out there!