Cryptocurrency Technical Highlights:
- Bitcoin has resistance ahead which could at least put pause in bounce
- Ripple has a big level to contend with in addition to trend resistance
- Ethereum holding up best, but won’t escape the pull of the group
See how traders are positioned in Cryptocurrencies and what it might mean on the IG Client Sentiment page.
Bitcoin has resistance ahead which could at least put pause in bounce
The other day with the cryptocurrency space in a free-fall, we were looking to potential points where they may find support and bounce. Bitcoin found buyers ahead of the targeted 5555 level, and has thus far maintained a bid.
However, rallies, even though they might be fierce at times, are still viewed as potential selling opportunities as the bubble continues to burst. The first level of resistance arrives around 9222, the Jan spike-low, then a trend-line not far beyond that level. A turn lower will bring the Tuesday low at 5920 back into focus and then the 5555 low from November.
Weekly reversal bars could be carved out if turnarounds hold the next couple of sessions. We’ll discuss the potential implications soon if relevant.
Want to learn more about cryptocurrencies? Check out this guide, Introduction to Bitcoin Trading
BTC/USD Daily Chart
Ripple has a big level to contend with in addition to trend resistance
The low in Ripple the other day came just above the 200-day MA, one of the targeted levels. But like Bitcoin, it is quickly coming up on resistance. The area to watch runs from horizontal resistance over 87 cents up to the trend-line running off the Jan high, clocking in around 94 cents.
The thinking on this end is that Ripple still has more to go on the downside despite having already lost such a significant amount of its value. The January 2017 trend-line is in the cross-hairs, and eventually a full-reversal of the rally from the wedge which formed during the second-half of last year.
Wedges leading to final pushes higher have a tendency of getting fully erased, which would mean a move still down to around 25 cents once the dust eventually settles. However, if resistance isn’t soon honored a larger rebound may be in store before resuming lower.
XRP/USD Daily Chart
Ethereum holding up best, but won’t escape the pull of the group
Ethereum continues to hold up the best of the group, and that may continue to be the case, however; much lower prices over time look inevitable for ETH/USD. Quickly coming into view is the underside of the trend-line extending higher from November. This is also in proximity with lows created during last month.
Looking lower, the low from Tuesday at 565 arrives as the first level of support, followed up by the 200-day which is currently in confluence with price support at 493. Like Ripple, a full reversal of the rally from the 2017 wedge is anticipated at some point, which points to a target of around 400.
ETH/USD Daily Chart
Whether you’re a new or experienced cryptocurrency trader, we have several resources to help you;Introduction to bitcoin trading guide, indicator for tracking trader sentiment, and a weekly webinar discussing the latest developments.
---Written by Paul Robinson, Market Analyst
To receive Paul’s analysis directly via email, please SIGN UP HERE
You can follow Paul on Twitter at @PaulRobinsonFX