Technical analysis on top 9 cryptocurrencies.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.
The market data is provided by the HitBTC exchange.
Cryptocurrency and the Blockchain technology has been attracting a large number of Wall Street executives to the industry. The latest addition is the former financial regulator, Gary Gensler, who was the Chairman of Commodity Futures Trading Commission from 2009-2014. He will be teaching a course at the Massachusetts Institute of Technology about the potential of Blockchain.
While JP Morgan has mostly been in the news for its CEO’s views on cryptocurrencies, the company’s former head of the global energy trading desk Daniel Masters believes that the crypto markets will be much bigger than their present state in the future.
New funds are cropping up to benefit from this. A few are being opened by millennials with very little knowledge of how Wall Street functions. It shows that the new breed of investors believe that trading cryptocurrencies is different than trading stocks, commodities or Forex.
We also agree that there are subtle differences that need to be applied if one has to be successful in trading virtual currencies.
Bitcoin has again entered a period of consolidation near the $9,200 mark. We had suggested booking partial profits at $9,400 in our previous analysis. Considering the tight consolidation, we recommend traders book partial profits around the $9,200 mark itself because if prices turn down from the current levels, they can easily fall towards $8,300 levels.
In a medium-term time frame, we believe that the BTC/USD pair will become range bound between $6,000 and $12,000.
This is such a large range that it can be traded with no difficulty. The aim should be to buy at the supports of the range, closer to $6,100 and close positions near the resistance levels of the range at $12,000. Between these two levels, the virtual currency can remain highly volatile.
For the current trade, the stop loss on the remaining position can be kept at breakeven.
Ethereum continues to move up without an entry opportunity. Sometimes, we may have to miss a few trades because they don’t offer us a good risk to reward entry level. Never run after a trade with the fear of missing out.
The moving averages are close to a bullish crossover, which is a positive sign. A rally to $745 is on the cards.
We anticipate strong resistance at the $745 levels. The price may either correct or consolidate, depending on the underlying strength.
In case of any correction, the ETH/USD pair can decline to $500 where it will find support from the moving averages.
We shall either enter on a consolidation or a dip.
Bitcoin Cash has performed as we expected. It is zooming ahead, duplicating its past patterns. It has comfortably crossed our second target objective of $1,300 and is on its way to our third target of $1,600. Traders who follow us are sitting on an 85 percent profit because we had suggested long positions at $779. We propose booking profits on 25 percent of the open position at the current prices.
This leaves about 25-40 percent of the original position open. We are not closing the complete position because, if $1,600 level is scaled, the next stop is $1,800 and $2,000.
However, the BCH/USD pair has a history of vertical rallies followed by an equally sharp plunge. Therefore, please protect the position with a suitable stop loss. Never let greed cloud correct reasoning.
Ripple has formed back to back inside day candlestick patterns on April 21 and April 22. This shows that the bulls and the bears are confused whether to carry the digital currency higher or lower.
If the price breaks out of $0.93777, the XRP/USD pair should rally to $1.08399. On the other hand, if it breaks down of $0.79933, we might see a fall to the 20-day EMA at $0.7.
The cryptocurrency may remain volatile in the large range. Therefore, traders should keep a trailing stop loss to protect their gains.
Stellar has started a new trend but is facing resistance at the $0.4 levels. The positive point is that it has been holding above the break out levels of $0.36 levels for the past four days.
If the XLM/USD pair doesn’t sink below the $0.36 levels, it remains on target to move towards $0.47, where traders should book profits on another 25 percent position.
The target objectives are only probabilities arrived at using technical analysis. They are not met all the time, and that’s why we always need to be ready for any course of events and protect the positions with a suitable trailing stop.
Litecoin broke out of the downtrend line and the 50-day SMA on April 20. On April 21, the price again slid back below the downtrend line but found support at lower levels. This is a positive sign, and it shows that the buyers are willing to buy on dips.
But the LTC/USD pair has not picked up momentum after breaking out. It is struggling to clear the $160 levels. If it doesn’t move up quickly, it can again fall to $140.
On breaking out of $160, it can rally to $178 levels. Hence, the aggressive traders can buy at $160 and keep a stop loss of $140. They can book partial profits at $180 and trail the rest higher.
The 20-day SMA has flattened out, but the 50-day SMA is still falling. This shows that the buyers are slow to return to this digital currency. Therefore, please keep the position size only about 50 percent of usual. It’s a risky trade.
Cardano failed to cross above the overhead resistance of 0.000035 on both April 20 and April 21. It formed a doji candlestick pattern on April 22 and is following it up with another small range day today.
On the downside, the ADA/BTC pair has support at 0.000030 and below that at the 20-day EMA. Traders can trail the stops based on their risk tolerance level, but don’t allow the position to turn into a loss.
NEO is struggling to break out of the $80 mark. It is facing stiff resistance from the downtrend line and the horizontal line at this level. And in our previous analysis, we had suggested booking partial profits at the $80 mark and raising the stops on the rest to breakeven.
On April 21, the NEO/USD pair fell but remained above our stop loss. It found support at the 50-day SMA.
For the past four days, the prices have been consolidating near the overhead resistance, a bullish sign. The moving averages are close to a bullish crossover, which is another positive development.
A breakout above $80 levels should start a new uptrend, which can carry the digital currency to $94 and then to $140 levels. Considering the large profit potential, we have recommended holding the remaining position with a trailing stop.
Traders who follow us have been holding EOS from the $7.5 levels. It has started a new uptrend and is trending inside the ascending channel two. It has exceeded our first target objective and is trading near the second target objective of $12.
We suggest booking profits on another 25 percent of the open positions at the current levels and trailing the remaining with the stops just below the support line of the ascending channel two.
The EOS/USD pair will continue to rise inside the channel and can reach $13 levels if the sentiment remains upbeat. We anticipate strong resistance just above the $14 mark. So as the price moves up, traders should tighten their stops further.
The cryptocurrency will lose momentum only if it breaks down of the channel.