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Analysis

Long-Term Cryptocurrency Analysis: Bitcoin, Ethereum, Ripple, Litecoin, Dash

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One week after our previous long-term look at cryptocurrencies, the major coins are still in correction mode, as they are working their way through the overbought readings that built up in the monster rally of this late spring. Bitcoin and Ethereum remain in the epicenter of the correction, although compared to the first half of the week, correlations broke down slightly, pointing to a less “panicky” environment. The Monday lows are still well below the current prices, as the majors are testing strong support zones this weekend.

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After three weeks of correction, and since our first warning, Bitcoin and Ethereum got very close to a being neutral considering the momentum indicators, meaning that we are likely in the bottoming process already, and the market already saw the lows. That said, given the huge prior rally, more sideways consolidation is likely before the next leg of the bull market.

Bitcoin

BTC/USD Daily Chart Analysis

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BTC more or less followed the possible trajectory that we anticipated last week, as it continues to follow the pattern of its previous complex corrections, like the one highlighted in March. We still expect more consolidation “waves” before a sustained move out of the pattern, with a possible re-test of the $2150 support, although volatility might stay muted compared to the wild moves of the previous two weeks.

Ethereum

ETH/USD Daily Chart Analysis

Ethereum completed a 50% correction once again, and the long-term MACD indicator is now approaching neutral territory. The coin tested and respected the long-term trendline this week and bounced off the support zone near $200 after a climactic move on Monday. The currency is right at the convergence zone that we pointed out last week, but more corrective price action is still likely after the huge rally with possible spikes lower to test the major support levels around $250.

Litecoin

LTC/USD Daily Chart Analysis

Litecoin is still in a different technical position than the two most valuable coins, as it is consolidating a recent break-out to new highs. The rising long-term trendline is converging with the prior high at $38 in the coming days, providing a possible take-off point for a next leg higher. That said, the correction of the two majors could still drag the coin lower to test this week’s lows, despite the bullish long-term picture.

Ripple

XRP/USDT Daily Chart Analysis

Ripple is still stuck in a long-term consolidation after its 7-fold rise in two months. The coin is trading in a broad range that has been intact since the end of May. The MACD indicator is glued to the 0 level, and short-term traders are still yet to get a buy signal since the failed break-out more than one week ago. Long-term investors could still add to their positions here, near the base that formed during the correction.

Dash

DASH/USD Daily Chart Analysis

Dash has been acting strong throughout the week, and it’s trading only 15% off its prior high, putting the coin at par with Litecoin in technical strength. The long-term picture is clearly bullish, but the slightly overbought MACD and the ongoing correction in BTC and Ethereum could mean that traders still have to wait for a break-out to new highs, although a dip below the crucial $150 support looks unlikely now.

How to Use These Charts?

As we stressed in our article on Bitcoin: “…not all strategies are binary (either holding an asset or not).There are many long- and short-term investment and trading strategies that can be successful in a roaring bull market like the one that the crypto-coin segment is experiencing, but mixing the time-frames and mixing trading and investing (see our article on the topic) could lead to troubles.”

Here is a reminder of some of the possible strategies once again:

  • Buy and hold, without caring about day-to-day (or even month-month) fluctuations
  • Buy and hold a core position and add on the major dips; a very powerful strategy
  • Buy a certain amount every week or month, and even-out your entry price, without the hassle of timing the market
  • Try to catch major turning points to reduce and “re-boost” your position
  • Trade short-term movements with stop-losses, targets, and strict risk management (this is trading not investing)”

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Analysis

Technical Analysis: Litecoin and Ethereum on the Move as Rotation Continues

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The altcoin bull run continued today despite the US Thanksgiving holiday, as trading remained active in the majors, and another important break-out occurred, this time in Ethereum. Litecoin is also strong today, and the coin is testing the key $75 resistance level, as it follows in the track of ETH again. The currency still looks set to hit the next target at $82.50, with the all-time highs below just below the $100 level also in sight. While the long-term momentum is edging towards overbought territory, the coin remains bullish on both time-frames, with strong support still found at $64 and $56.

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LTC/USD, 4-Hour Chart Analysis

Ethereum scored a new record high after moving past $400 for the first time in five months, and considering the lengthy consolidation before the move, more upside is likely for the second largest coin. With the long-term momentum still not being overbought, the token’s price might test the $500 mark in this leg higher, with Fibonacci targets ahead at $475 and $512. Support levels are found below $400 at 4380 and $350.

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ETH/USD, 4-Hour Chart Analysis

Ripple is also attempting another bullish move, while Monero and Dash are consolidating just below their recent highs, while IOTA is in a short-term correction pattern as well. More and more altcoins are now in the latter phases of their rallies, just like Bitcoin, but traders still have opportunities with favorable risk-rewards ratios. Let’ see the short-term charts.

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Analysis

Break-Out: Another Crazy Rally in Ethereum?

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What crazy rally you might ask? Bitcoin is the star, right? Everything was about BTC (and BCH) in the last few months, and lots of traders forget the gains that ETH posted amid the take-off of the ICO Rocket during the spring.

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Comparing ETH and BTC in 2017

By the numbers, out of the two largest coins, 2017 is still the year of Ethereum as the 3600% rise in the token’s price dwarfs Bitcoin’s impressive 630% gain. Could Ethereum be on the verge of another epic surge? Before answering that question, first let’s see what happened with the coin in recent months.

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How Did We Get Here?

ETH/USD, Daily Chart Analysis

Ethereum finally broke above the magical $400 barrier that has kept a lid on the token’s price for five months after the crazy run-up in May. What first followed after that stellar move, was a 70% decline top-to-bottom, with a flush-out panic low in July.

Our trend model turned long-term positive even before the spike lower, but since then, the coin only managed to get close to the all-time highs, while Bitcoin eclipsed the previous star with its dominant performance. Now the tide might be turning, as ETH is finally gathering bullish momentum and today it breached the $400 mark, flirting with a break-out from the giant triangle consolidation pattern.

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Altcoins

Zcash Dip Offers Chance to Buy

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The ZEC/USD pair went into a downtrend for several days after hitting the 435 level in June. It shed more than half of its value before establishing strong support at 140. The market tried to reclaim resistance at 310 twice, but was sent back on both occasions. As a result, we have a massive reversal structure that might skyrocket the pair into a new all-time high.

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The market closed above 310 a couple of days ago on weak volume which is why it’s struggling to stay above that level. Technical indicators show that momentum is weakening, increasing the likelihood of a dip. A slight correction not only gives the market legs for its next move up, but it also offers you a chance to place orders.

They key indicator to watch for is volume. As long as volume remains sluggish, the market will most likely slide down to 280 first and then 262 next. That’s a good zone to accumulate positions. If volume suddenly spikes, at least 230k at Bitfinex, then we have a legitimate breakout that will take the market to 465.

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 Summary of Strategy

Buy: between 280 and 262 OR confirmed breakout with volume of at least 230k at Bitfinex

Support: 280, 262, and 243

Resistance: 310, 352, 400, and 412

Target: 465

Stop: If the market breaches 243

 

Disclaimer: The writer owns bitcoin, Ethereum and other cryptocurrencies. He holds investment positions in the coins, but does not engage in short-term or day-trading.

Featured image courtesy of Shutterstock.

 

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