Latest technical analysis of top 9 cryptocurrencies from an expert trader
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The market data is provided by the HitBTC exchange.
The Securities and Exchange Commission doesn’t consider Ether to be a security. This news led to a bounce in most of the top 100 cryptocurrencies pushing their total market capitalization from $265 billion on June 13 to $290 billion on June 15.
Bitcoin prices also recovered on June 14. In a study, Fundstrat’s head of research Thomas Lee noted that Bitcoin declines about 18 percent, leading to the Bitcoin futures expiration on the CBOE. The recovery happens by day six, following the expiration. So, if the theory holds good this time, we should see a recovery in Bitcoin from next week. We shall keep this in mind during the analysis, but we will not trade solely on this finding.
While many retail investors are waiting for lower prices, big money is unfazed by the fall and is ready to invest in digital currencies. To cater to this demand, US crypto exchange Coinbase has opened its Index fund to large-scale investors.
Stephen Bannon, a former Chief Strategist for U.S. President Donald Trump’s administration, is the latest to voice his support for cryptocurrencies. He also said that he holds a “good stake” in Bitcoin.
After the recent bounce, is it a good time to buy? Let’s find out.
In the last two years, Bitcoin has always bounced sharply from the oversold levels on the RSI. This streak was broken when the most recent pullback from $7,106 on May 29 could only rally to $7,755.61. Hence, traders should avoid initiating long positions only on the basis of the RSI signal.
A number of analysts are advocating downtrend for the digital currency. We, however, have maintained that it is likely to remain range bound with the bottom being $6,075.04. The leading digital currency has not broken below the intraday lows made on February 06, and the moving averages have been crisscrossing each other frequently, which is a proof that the trend is not down but range bound.
The best way to trade a range is to buy, when the price is at the bottom of the range. However, we have introduced an added filter to increase our factor of safety.
In 2018, a break out of the 20-day EMA has been a short-term trading opportunity. If history repeats itself and the BTC/USD pair embarks upon a rally, we want to buy it once it breaks out and sustains above the 20-day EMA. The overhead resistances are $7,755.61, $8,566.4 and $8,888.
None of our assumptions are set in stone. We change them as and when the charts change. So, if the price breaks down and sustains below $6,075.04, we shall turn negative and avoid any fresh purchases.
The breakdown of the $492.5 levels on June 13 proved to be temporary, as Ethereum rebounded sharply on June 14, following the good news. The pullback stalled at the resistance line of the descending channel. Today, the bears are trying to sink the digital currency back below $492.5 levels. If they succeed and break below the June 13 lows of $450.1, the decline can extend to the support line of the descending channel.
On the other hand, if the bulls hold the zone between $450.1-$492.5, then another pullback attempt is probable. On the upside, the ETH/USD pair can face selling at the resistance line of the descending channel, at the 20-day EMA and the downtrend line.
Hence, we shall propose a long position only on a breakout and close (UTC) above the downtrend line.
There is no buying opportunity at the current levels, hence, it is best to remain on the sidelines.
The previous support at $0.56270 is acting as a resistance. If Ripple doesn’t break above this level quickly, it will continue to fall towards the final support at $0.45351. We anticipate a strong buying close to this level because if this breaks, the next support lies way lower at $0.24.
The XRP/USD pair will turn bullish only on a breakout of the downtrend line of the descending triangle. However, it will start to show signs of recovery once it sustains above the recent swing high of $0.70292.
There are no bullish formations or any signs of a confirmed bottom yet, hence, we are not recommending any long positions on it.
Bitcoin Cash looks weak. Though it is close to the critical support zone of $777.5304-$736.0137, the pullback on June 14 did not even reach the downtrend line. This shows that the buyers are in no hurry to own the digital currency at these prices.
The first sign of strength will be when the price breaks out of the 20-day EMA and the downtrend line.
On the downside, any break below $736 levels can sink the BCH/USD pair to $620 levels. Currently, we don’t find any buy setups; hence, we are not suggesting any trade on it.
EOS rebounded sharply from $9.0887 on June 13 and scaled above the $10.3384 level, which is a bullish sign.
The EOS/USD pair is correcting today, but if the bulls can stem the fall above the $9 levels, it will indicate that the retracement is over. We shall recommend a long position once the price breaks out of the 20-day EMA and the downtrend line.
If the bears force a break below $9 levels, it will indicate weakness and the digital currency can slide to $8 and below that to $6 levels. We shall get a clear picture in the next couple of days.
Litecoin looks weak. Both the moving averages are sloping down. The rebound from $90.994 on June 13 did not even reach the breakdown levels at $107.102 even though the RSI was in a deep oversold territory. This shows that the buyers are still not keen to own the virtual currency at these levels.
The downtrend will resume once the digital currency breaks below $90.994 levels. The next levels to watch out on the downside are $84.708 and $75.131.
The LTC/USD pair will gain some strength if it breaks out and sustains above the $107.102 levels for a few days. Until then, all rallies are likely to be sold.
Cardano has turned down just after a day’s pullback on June 14. If history repeats itself, it might spend a few days near the $0.15 levels, frustrating the traders.
We consider $0.13 to be major support. If this holds, our view of a large range in the ADA/USD pair will be validated, which will offer us a low-risk and high-reward trading opportunity.
However, if the support at $0.13 breaks, the decline can extend to $0.078 levels. We shall get better clarity in a few days.
Stellar bounced from just above the $0.2 levels on June 13, but higher levels are attracting selling. This shows that it is still not out of the woods.
If the bulls hold the next decline above the $0.2 levels and bounce off strongly from there, it will indicate a likely bottom, and we might recommend a long position.
On the other hand, if the bears sink the XLM/USD pair below the $0.2 levels, a retest of $0.184 is likely.
As the next move is still not clear, we recommend waiting for a few more days before entering any long position.
The pullback from the lows of June 13 was short lived as it could not rise above the $1.33 levels. The previous support will now act as a resistance. IOTA will fall to $0.9150 levels if it breaks below $1.22.
We anticipate buyers to return close to the $0.9150 mark. By then, the RSI will also be in the oversold territory, which will elicit a pullback.
If the bulls fail to hold the $0.9150 levels, the IOTA/USD pair can decline to $0.666 levels. Therefore, we shall wait for a confirmation of a bottom before suggesting any new trades.
The market data is provided by the HitBTC exchange. The charts for the analysis are provided by TradingView.