Long-Term Cryptocurrency Analysis: Bitcoin Leads the Charge as Ethereum Breaks-Out
The most valuable digital currency shrugged off all the bubble talk and regulatory concerns of the recent period and surged to a new all-time high above $5000, as we expected. The coin almost doubled from the China lows, with a short-term top near the $5900 level but now it is short-term overbought and the long-term picture also looks stretched.
That said, more gains are possible (with the final range-projection target at $7000) as the late-coming bulls pile in, but both investors and traders should reduce their holdings as the price advances as correction risk is rising progressively. Short-term support is near $5450 and the 23.6% Fibonacci extension, with further levels at $5000, $4650, and $4400.
BTC/USD, Daily Chart Analysis
Most of the other majors are also showing bullish signs, and the strength of Ethereum is especially encouraging, while Ripple is working its way through the correction that we have been expecting after its surge. Litecoin and Monero are on the rise too, while Dash is still in correction mode, but it’s edging towards a likely break-out as well. As the divergent nature of the bullish trend is still apparent, let’s see where the daily charts stand this weekend.
ETH/USD, Daily Chart Analysis
Ethereum finally showed relative strength this week, and while the all-time high of the coin is still almost 20% above the current price, a re-test of $400 is likely in the current leg higher. The long-term MACD is far from being overbought, and the token might be ready to launch a rally towards the next major resistance at $380, with support found at $300 and $285.
LTC/USD, Daily Chart Analysis
Litecoin also cleared a major hurdle this week, rising above the $56 resistance that capped the post-crash recovery before. The next major level is ahead at $64, and we still expect the currency to resume its dominant uptrend. The daily MACD is in neutral territory, with support levels below $56 at $51 and near the $44 level.
XRP/USDT, Daily Chart Analysis
Ripple in a volatile short-term correction throughout the week, with a focus on the $0.26 level that we have been monitoring. The coin found support near $0.24, and we still expect a rally towards the $0.30-$0.32 zone in the coming period, with the long-term MACD still being close to neutral, while the short-term uptrend being intact. Further support is found around the $0.22 level, and just below $0.20.
DASH/USD, Daily Chart Analysis
Dash continues to lag slightly the broader market after its stellar rise in August, but the correction is likely nearing its end with the MACD being close to a bullish cross. The declining trendline is also just above the current price levels, near the $330 resistance, with another strong level found at $360. While further sideways price action is possible we don’t expect a durable move below $300 before the next leg higher.
ETC/USD, Daily Chart Analysis
Ethereum Classic is still among the weakest majors and it failed to join this week’s rally, as it got stuck below the short-term resistance near $12.50. Long-term investors could still add to their positions here, but a move above the key $13.50 level would be needed for a confirmed trend change. Strong support is found at the $11 and $9 levels, while further resistance is ahead around $16.
XMR/USD, Daily Chart Analysis
Monero broke out from the dominant declining trend yesterday after finding strong support just above $80. With the long-term MACD being in neutral territory, the coin could be in for a strong leg higher, with targets at $100, $125, and near the all-time high just above the $150 level.
IOTA/USD, Daily Chart Analysis
IOTA showed surprising weakness this week, as it spiked below the key support zone between $0.45 and $0.48. The coin is now back above the $0.45 level, but the declining short-term trend is still intact. That said we still expect the long-term uptrend to resume, with a rally towards $0.64 in the coming weeks. Long-term investors could still add to their positions here, but short-term traders should wait for the coin to show relative strength before entering new positions.
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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