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Analysis

Weekend update for ETHXBT, XRPXBT, Litecoin and Bitcoin

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The week passed by in a surprisingly different manner than I had been expecting. One week ago I thought that it was going to be an exciting week of fireworks in many of the coin markets. But overall, it was a week of sideways movements for the most part, with an awakening just in the past 2 days or so.

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I was therefore enticed to look a bit further into a few of the charts, to see what I may have overlooked. As you may have already guessed there are so many forces acting on the different charts that “Chaos Theory” becomes real. The butterfly effect, the wings of a butterfly causing small perturbations that cause a hurricane half a world away, is an everyday occurrence in the charts.

Chaos Theory posits that the smallest influences on a dynamic system causes huge ripples later, so much so that something as studied as the weather with billions of dollars of equipment and thousands of people studying, have a hard time getting the weather right beyond a few days out, because a sudden warm Santa Ana wind can change the charts in a moment.

ETHXBT

Let’s look at the ETHXBT chart as an example. I have removed many of the lines, Gann Fans in particular to make this screenshot easier to understand. If you look, you will note that there are not one, but two different setups on the same chart. Price encountered a 2nd arc pair (green) which brought the price down over a few weeks. It rose again until it hit a 1st arc pair (red) of a shorter-term setup.

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I will demonstrate this phenomenon on another chart or two today. For now, it is enough to recognize the short to medium term implications on price. As traders that’s what we care about the most. But ultimately, one day, my fervent hope is to understand exactly how it is possible, that the independent decisions of tens of thousands of traders, buying and selling for undisclosed reasons, can create such beautifully choreographed fractal images that would have made Mandelbrot blush.

Since this screenshot was captured, price has closed above the red arc. This is short term bullish, with the promise of a good run when/if price gets above the 2nd arc of the pair.

 

XRPXBT

This charts has traded almost flat, on the 50% retracement line, fluctuating from .382 to .618, of the high and low after the fall at the beginning of the month. Any close above or below that channel will give an indication of direction – but my guess is up. But when?

Here we see that price is soon to hit the 2nd arc of the pair. My advice is to watch this carefully. It is likely to find a good reason to rally when it passes through the arc.

Litecoin

Litecoin is another coin that I found multiple setups acting price simultaneously. I changed the colors of the longer term setup’s 3rd arc pair to yellow, so they could be easily differentiated from the 1st arc pair of a shorter setup.

Note that at the recent high, price hit both arcs at the same time at the moment they intersected (highlighted in yellow). This is too improbable to be a coincidence. It seems like a case of Chaos Theory’s “Strange Attractor” for those who have studied Chaos.

After the more recent rally, note how pricetime is responding to both arc pairs, even though they are from completely different setups on the same chart. I am fairly confident that price will get through the pair(s) and rally to the next resistance at ~ $15. But cautious traders will wait for the buy signal.

 

Bitcoin

On a longer term setup on the daily chart, Bitcoin is in a 4th arc pair. Anything can happen while within the pair, but I am not bullish here. Time will tell, but I have a feeling that price will head to $1000 before rallying again.

 

There are simply too many coins to cover these days to adequately cover them all in a single column. Watch Dash, Zcash, and Ethereum of course… Until next time….

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

Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



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5 Comments

5 Comments

  1. And

    April 15, 2017 at 3:38 pm

    Thanks Jim, your columns are really great! Please remember to give us some buy signal, like April 3rd, for Litecoin 🙂

  2. Jim Fredrickson

    April 15, 2017 at 11:31 pm

    now, at 11.80, looks like a good entry point for ltcusd.

  3. And

    April 16, 2017 at 8:11 am

    Thank you Jim!

  4. Ershad

    April 18, 2017 at 7:34 pm

    Hi Jim,

    can you recommend a good stop loss and selling price for XRP. should it start to rally?

    Kind regards

    • Jim Fredrickson

      April 19, 2017 at 3:04 am

      I’m not sure of your timeframe, but there will be resistance at .048, and longer-term at .09…

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Analysis

Long-Term Cryptocurrency Analysis: Bitcoin Flirts with $8000 as Altcoin Bull Persists

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Bitcoin’s swift recovery was the main topic of the week, as the most valuable coin not just regained its steep losses, but hit a marginal new high towards the end of the period. The entire segment is experiencing capital inflows as the total value of the coins climbed above $230 billion for the first time ever after finally leaving the vicinity of the $200 billion mark.

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BTC breached the $8000 level before turning slightly lower on Friday, but despite the severely overbought daily chart, it is still trading near its all-time highs. As the long-term picture still suggests a deeper correction, investors should wait with opening new positions and traders should also control position sizes here. Key support levels are found at $7700, $7000, and $6700, while the recent key break-out level at $5000 still hasn’t been re-tested.

BTC/USD, Daily Chart Analysis

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Dash is still the most bullish altcoin from a technical standpoint, despite this week’s short-term correction, as the coin is trading above its prior all-time high, and this weekend, it looks ready to test the break-out high near $500. Support levels are still found at $400, $360, and $330, and as the long-term picture is approaching overbought territory, investors should only hold on to their positions here.

DASH/USD, Daily Chart Analysis

The other major altcoins are also mostly in bullish setups, with some of them already in the latter stages of this cycle, like Monero and IOTA, but elsewhere in the segment, there are still opportunities for both traders and investors. Let’s see the detailed long-term view.

(more…)

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Analysis

Technical Analysis: Litecoin and NEO Jump as Bitcoin Trades near $8000

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The cryptocurrency segment continued its bullish run, as the total value of the coins climbed above $230 billion for the first time ever, while Bitcoin also posted marginal new highs. The most valuable currency is still overbought regarding the long-term picture, and we continue to expect a deeper correction in the coming period, despite the recent strong rally. Support levels are still found $7700, $7000, and $6700 while the $8000 level is ahead as a major obstacle.

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BTC/USD, 4-Hour Chart Analysis

Litecoin has been the most active major besides Bitcoin, as it rallied strongly after breaking out above the key $64 resistance and it breached the next target at $75 before heading below $70 again. The coin remains in bullish long- and short-term patterns, and we expect a move above the major resistance zone ahead with the next target found at $82.50.

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Litecoin/USD, 4-Hour Chart Analysis

NEO is showing strength in the second half of the session, while Monero is recovering well from a short-term dip, similarly to IOTA and Ethereum Classic. Ethereum continues to represent stability in the segment, while Ripple failed to build up momentum so far after yesterdays spike higher. With still most of the altcoins being in bullish setups, let’s see the short-term charts.

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Analysis

XRP Looking to Make a Significant Rally

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The XRP/USD pair went into a deep correction after hitting 0.29490 a month ago. It nosedived to the major support level of 0.19052. The pair consolidated for a few weeks which gave the market the legs to test resistance at 0.22924.

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Technical indicators show that the pair was ready to breach its immediate resistance, which it did this morning. Now that resistance has broke at 0.22924, it’s time to buy. This successful breakout will take the pair to 0.23997 first and 0.26563 next before hitting the target of 0.26796 which is coincidentally a major resistance level.

Technical indicators hint that the market would most likely be overbought by the time it hits 0.26796. Should it respect the major resistance level, the likelihood of the market turning extremely bearish increases. Therefore, it is recommended to closely watch your trail stops to preserve your gains.  

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Summary of Strategy

Buy: As close to 0.22924

Support: 0.22224 and 0.20081

Target: 0.26796

Stop: If the market breaches 0.20081 as next reliable support is 0.19052

 

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.

Important: Never invest money you can't afford to lose. Always do your own research and due diligence before placing a trade. Read our Terms & Conditions here.



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