Long-Term Cryptocurrency Analysis: Crucial Rally Attempt
The crypto segment is at a very important point from a technical perspective following the strong late-April rally and the subsequent correction. The major coins formed a bottom last week after triggering long-term buy signals and now a very important rally attempt is underway.
Several weaker coins drifted back to their April lows, with Bitcoin also getting relatively close to the base that developed this year. The leaders of the April rally shined once again, with IOTA, EOS, and to a lesser extent Ethereum showing relative strength during the rally.
Despite the positive signs, and the short-term buy signals that popped up during the weekend, the momentum of the move stalled today, and the advance is already facing a key test. For now, the rally is intact, and the coins remain dominantly on buy signals in our trend model, but especially the leaders should be monitored closely in the coming days.
BTC/USD, Daily Chart Analysis
We expect the recovery to continue, even as Bitcoin is once again lagging the leading altcoins, as it was the case during the April rally. BTC is stuck below the $7650-$7800 level, and although the long-term setup is bullish, the coin failed to trigger a short-term buy signal, while the daily MACD indicator is also pointing to weak bullish momentum.
That said, long-term investors could add to their holdings here, as the secular bullish trend is still clearly intact. Further resistance is ahead at $8400, $8700, and between $9000 and $9200, while support is found at $7350, $7000, $6500, and $6150.
ETH/USD, Daily Chart Analysis
Ethereum recovered well after a period of relative weakness, and the coin formed a bottom near $500, keeping the recovery intact, and staying well above the April low. The currency ran into resistance in the $625-$645 range, but we expect the rally to continue, and ETH is on a buy signal on all time-frames. Primary support is found between $555 and $575, while further resistance zones are ahead between $735 and $780 and near $845.
LTC/USD, 4-Hour Chart Analysis
Litecoin failed to move above the $125 level so far, and the coin remains among the weaker majors even after drifting out of the declining short-term pattern. Investors could add to their holdings on the short-term pullbacks, and we still expect the coin to hold the strong base pattern near $100, while further resistance zones are ahead near $140, $150, and between $170 and $180.
DASH/USD, 4-Hour Chart Analysis
Dash has also been among the weakest majors in recent weeks, and the rally attempt is also not convincing so far. The coin failed to trigger a short-term signal, and traders should remain cautious with new positions until Dash shows signs of strength. The secular uptrend remains intact despite the weakness, and long-term investors could still add to their holdings here. Support is found at $300 and near $260, while resistance is ahead at $360, $400, and $435.
XRP/USD, 4-Hour Chart Analysis
Ripple has been showing relative strength recently and the coin is now on a short-term buy signal after while being bullish from a long-term perspective as well. XRP is now above the $0.64 support/resistance level, although it faces further strong resistance near $0.73 and $0.84. We expect the recovery to continue with a strong base pattern found between $0.45 and $0.54.
ETC/USD, 4-Hour Chart Analysis
While Ethereum Classic is now on a buy signal both short- and long-term, it failed to gather strong momentum and the $16 resistance level stopped the advance for now. While the long-term indicators signal a durable bottom, the short-term weakness could point to another test of the lows, and traders should focus on the relatively stronger coins. Support zones are still found near $14.50 and $13.50, while further resistance is ahead at $18.
XMR/USD, 4-Hour Chart Analysis
Monero is also among the weaker coins and it failed to trigger a short-term buy signal, even as the long-term picture turned positive. We still expect the coin to hold the long-term base pattern between $150 and $175, but traders should still stay away from new positions here. Long-term investors still accumulate the coin with further resistance ahead at $200, and strong support below $150 found at $125.
NEO/USDT, 4-Hour Chart Analysis
NEO built up some short-term relative strength last week, but the momentum of the rally is still weak, and the coin is facing strong trendline resistance near the current price level. NEO is on both short- and long-term buy signals, but the coming days will be crucial for the coin. Further resistance zones are ahead near $64, $70, and $80, with support found near the $50 level.
IOTA/USD, 4-Hour Chart Analysis
IOTA rallied strongly off the correction lows as we expected, and it hit the $1.9 level before entering a short-term pullback. The coin is now back near the $1.7 level, and we expect the rally to continue while the long-term picture is also bullish. Further resistance levels are ahead near $2.2, $2.35, and $2.6, while key support is found at $1.5.
EOS/USD, 4-Hour Chart Analysis
EOS ran into resistance near the key $15.50 level after breaking out of a short-term correction pattern, and the coin remains one of the clear leaders of the market despite the current pullback. The short- and long-term buy signals remain intact, with support found at $12, $10, and $9, while targets above 415.50 are ahead at $19 and $23.
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-to-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)”
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.