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Ethereum, Litecoin and Bitcoin Analysis

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Sometimes it seems like reading charts is like tracking the weather. It seems much easier to track the course of a hurricane than it is to predict when one will start, when it’s quiet outside. Likewise, sideways movement is challenging not just because it’s so easy to lose money trading it, but because it’s hard to know which of the myriads of S/R will finally kick something off.

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Ethereum

In our last update, we forecasted that ETH would likely begin a rally, and indeed that has happened. There is multiple resistance at lower levels of course, but the longer-term forecast is for ETH to go to the mid-$60s.

 

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ETHXBT

ETHXBT has rallied after clearing a second arc, as discussed in our last column. However, it is now sitting at resistance again. ETH seems highly likely to rally further, but XBT is the wildcard. We will look at Bitcoin shortly, but the spoiler is I would not hold this position right now, personally.

 

Litecoin

It was not all that surprising that litecoin found resistance where it did, but I was a bit surprised that it fell as hard as it did. I am still holding this asset, as it seems to still want to go up. But if $10 breaks, I fear that $8 could be in the cards.

 

Bitcoin

As I have mentioned in the past 2 columns, Bitcoin is traversing an arc pair on the daily charts. It will soon hit the 2nd of the arc pair. I have been short-term bearish, but the asset has not fallen. I have given up my bearishness and taken a more neutral position. When the next arc is touched we will see what the market does. We won’t have to wait much longer.

 

Remember: The author is a trader who is subject to all manner of error in judgment. Do your own research, and be prepared to take full responsibility for your own trades.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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5 stars on average, based on 1 rated postsJim has an MBA from the University of Southern California. He has had a long career in both Corporate Finance and IT. Along the way he discovered that trading was a vehicle with great promise, but struggled for a long time without a mentor. After having been knocked down many times and having struggled to get back up, he had an epiphany and realized that geometry was a solution. He shares his experience here. If you do well as a result of suggestions made here, feel free to say thank you :) BTC: 1FUq3GB1Q8zz2JpuBr7YHzVBKnaWoxgmya Follow him on Twitter (@jimfred1276) or email him at jimfred1276 at gmail.




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4 Comments

4 Comments

  1. Chanh2308

    April 19, 2017 at 3:05 pm

    Thanks Jim,
    So, still hold LTC? When sell it?

  2. Ershad

    April 19, 2017 at 3:07 pm

    Hi Jim, any further comments on XRP and it’s likely price movement ? And what price would you recommend putting a stop loss on ETH?

    Kind regards
    Ershad

  3. phucphan

    April 19, 2017 at 4:44 pm

    Hi Jim, How about xmr?

  4. dufc1983

    April 20, 2017 at 12:20 am

    Hi, my prediction for BTC is 1327.43 at some point within 9 days I have a chart but cant upload it . sorry. (ps im new to trading so don’t be tooooo hard on me if my prediction goes against me. love the blog. Sean.

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Analysis

Crypto Update: Coins Lose Ground as Range Trading Continues

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While the weekend rally got bulls hope up that the consolidation phase might have ended, the technical setup hasn’t changed much in the segment, and today all of the major coins are lower again. The losses, which range from 2-5%, are not significant from a long-term standpoint, and most of the top coins are still clearly above the crucial support levels that mark the lower boundaries of the short-term trading ranges.

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With that in mind, traders still shouldn’t change their neutral stance, as there is no clear momentum present that would justify new positions here. Bitcoin continues to slightly outperform most altcoins today, but the divergence is not significant from a technical standpoint. Trading volumes continue to be well below the levels of the recent weeks, and that reinforces the bullish consolidation scenario.

BTC/USD, 4-Hour Chart Analysis

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BTC drifted back below the key $8400-$8600 zone, and it remains stuck the lower boundary of the range today, despite its slight relative strength. As the short-term MACD indicator is neutral, and our trend model is also on a neutral signal, further choppy trading is likely ahead.  Short-term support is found near the intraday low, at $8150, with a stronger zone between $7650-$7800, with further resistance ahead between $9000 and $9200, $10,000, and $10,500.

ETH/USD, 4-Hour Chart Analysis

Ethereum is trading right at the center of the short-term range, as the coin gave back most of its weekend gains, while losing its relative strength in the process as well. The coin remains on a neutral short-term trend signal similarly to the broader market, with the price action still being consistent with an orderly correction. Resistance is ahead between $735 and $780, at $845 and $900, while support is found between $625 and $645 and between $555 and $575.

Tron Still Outperforms as Correlations Remain High

TRX/USD, 4-Hour Chart Analysis

Tron made the most progress among the op coins since bottoming out after the correction, and the coin remains bullish from a short-term perspective despite the current pullback. The $0.075 support/resistance level is in the center of attention, while the late-April high at $0.010 is the next target for the move. As the broader market remains in a corrective phase, but the coin is one of the prime candidates to hit a new high in the coming weeks.

Dash, Monero, Ripple, and Litecoin are still weaker than segment average, while the recently lagging IOTA held the key $1.7 level. For now, there is still no sign of a developing robust leadership, as EOS failed to regain its bullish momentum, and no major joined Tron in the rally.

Featured image from Shutterstock

Disclaimer:  The analyst owns cryptocurrencies. He holds investment positions in the coins, but doesn’t engage in short-term or day-trading, nor does he hold short positions on any of the coins.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 255 rated postsTrader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.




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Analysis

Technical Analysis: Dow Jones Moves Toward Intermediate-Term Target, Closes above 25,000

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Technical Overview

  • On May 8, the Dow Jones Industrial Average was on the verge of completing a 2-month bottoming pattern. On May 9, the index gave the buy signal with a minimum price target of 26,200 (1,300 points from the point of the breakout – white vertical trendline in Figure 1).
  • Last week’s advance fell less than 5 points short of the 25,000 level. The 8 EMA served as support during the subsequent correction (yellow line).
  • Today (May 21), the index jumped by nearly 300 points to close above 25,000 for the first time since March 13.
  • The Feb 9 & April 2 lows have created a tentative “double bottom” formation. The pattern will be completed if the index breaks above the pattern’s interim high (red horizontal trendline).

Major support levels:

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  • The 24,600 level (last week’s base).
  • The neckline of the inverse H&S pattern (white downward-sloping trendline, currently at 24,200).

Major resistance levels:

  • Double bottom interim high at 25,800 (red trendline).
  • Origin of February correction & January high – 26,400 to 26,617 range.

Figure 1. Dow Jones Industrial Average Daily Chart

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Implications

  • While the tech-heavy NASDAQ pulled back from its intraday high, DJIA continues to perform strongly, marching towards the upside target obtained from the H&S pattern.
  • In one trading session, the index made up for an entire week of sideways/corrective movement. Such price action is indicative of fast-moving markets, which are leaping towards a specific target. In this case, the completion of the inverse H&S is expected to continue driving the index higher at least until it retests the 25,800 level.
  • If the index moves above 25,800 the double bottom will be completed. A move above January’s high will further strengthen the bullish thesis and shift the long-term outlook to bullish.
  • Long positions in index-tracking ETFs and constituents recommended.

 Outlook

  • Short-term outlook as long as the index remains above its 8 EMA.
  • Intermediate-term bullish as long as the index remains above the neckline of the inverse H&S pattern.

Featured image courtesy of Shutterstock.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.8 stars on average, based on 12 rated postsPublished author of technical research. In his work on price “gaps”, published in the 2018 International Federation of Technical Analysts’ Annual Journal, he developed a new technical tool for analyzing and trading the “gap” phenomenon – the “K-Divergence” (http://ifta.org/public/files/journal/d_ifta_journal_18). Besides obtaining a Master in Financial Technical Analysis, he has completed a BBA and an MBA from the Schulich School of Business in Toronto and has completed all exams for the CFA, CMT and CFTe designations. Currently, providing research to investment management and financial advisory firms. http://www.linkedin.com/in/konstantindimov




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Analysis

Crypto Update: Sideways Drift Continues as Bitcoin Fights with the $8400 Level

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The largest coins attempted another rally towards the end of the weekend, but today the, not too strong, momentum faded and the majority of the majors is sliding lower today. The coins are in or close to the recent trading ranges, with the whole segment hovering in or near the recent ranges, without major changes in the technical setups.

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The low-momentum environment means that the coins are still on neutral short-term trend signals, and traders should still wait before entering new positions, as the short-term trend remains corrective. That said, most of the majors are holding up above crucial support levels and the underlying bullish trend is intact while the overbought readings that developed during the late-April rally are being cleared. Out of the top coins, only Tron made significant technical progress, and until a clear leadership develops, choppy conditions will likely continue.

BTC/USD, 4-Hour Chart Analysis

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Bitcoin finally showed some relative strength today, reclaiming the $8400 level, and reaching an intraday maximum near $8600. Despite the move, the coin is now back near the key support level, and with $8700 level still ahead as strong resistance, the trend signal remains neutral.  While the coin drifted out from the declining short-term trend, a new trend hasn’t established yet.

Short-term support is found near $8150, while the $7650-$7800 range provides long-term support, with resistance ahead between $9000 and $9200, $10,000, and $10,500.

ETH/USD, 4-Hour Chart Analysis

Ethereum is still hovering around the $700 level, still in a corrective phase following strong April rally, and the coin remains on a neutral trend signal as well. Resistance is still ahead between $735 and $780, with targets above that at $845 and $900, while support is found between $625 and $645 and between $555 and $575.

Total Market Value Stuck Below $400 Billion

IOT/USD, 4-Hour Chart Analysis

As altcoins gave back a large portion of the weekend gains, the total market cap of the coins is at $380 billion again, despite Bitcoin’s stability. On a negative note, the previous leaders of the rally, IOTA and EOS failed to make a move, and the latter is showing weakness today, trading near the correction low. All in all, price action points to further consolidation in the segment, and traders should remain patient until buy signals start ot pop up.

Important: Never invest (trade with) money you can't afford to comfortably lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here. Trade recommendations and analysis are written by our analysts which might have different opinions. Read my 6 Golden Steps to Financial Freedom here. Best regards, Jonas Borchgrevink.

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4.5 stars on average, based on 255 rated postsTrader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.




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