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.
The Reserve Bank of India has banned regulated financial institutions from dealing in cryptocurrencies, citing the risks involved. American billionaire Tim Draper believes that India is making a big mistake by shutting its doors to cryptocurrencies. According to Draper, this will only lead to brain drain as many will be forced to move to other places, which are more crypto-friendly.
Japan, which is a major hub for crypto and Blockchain activity is facing shortage of software engineers. There are similar requirements at other places, where Blockchain professionals are in demand. This has forced the top MBA colleges in the world to increase the presence of virtual currency and Blockchain classes in their programs.
With the RBI’s move, India will lag behind other nations in the technology of the future.
Turning back to Bitcoin’s price, Thomas Lee, the head of research at Fundstrat Global Advisors believes that the cryptocurrency’s sell offs will subside after the mid-April tax filing deadline. He has maintained his year-end targets of $25,000 for Bitcoin and $1,900 for Ethereum.
On the other hand, investment research firm Capital Economics believes that Bitcoin will be a huge underperformer compared to the other asset classes in the coming months.
Like any other asset type, cryptocurrencies will have analysts taking both bearish and bullish views. But, we shall rely on the chart patterns to initiate trades that offer us a good risk to reward ratio. Let’s see if we find any buy setups today.
Bitcoin is close to breaking down of the April 01 lows of $6,757.26 and moving lower towards its next support of $6,075.04. Though the digital currency has fallen below the $7,000 level, we don’t find any significant buying support.
The 20-day EMA is trending down and is placed just above the resistance line of the descending channel. The BTC/USD pair has not broken out of the 20-day EMA since March 08, which shows the extent of selling. This will act as a major resistance on any pullbacks.
We suggest a buy only after price breaks out and remains above the 20-day EMA.
Ethereum has been trading in a tight range, between $358 and $418.70, since March 30. The trend remains bearish as both moving averages are falling and price continues to make lower highs and lower lows.
If the ETH/USD pair breaks below $358, the downtrend will resume and a fall to $300 levels is likely.
If $358 level holds, the digital currency will continue to consolidate in the tight range. On the upside, resistance is at $418.79 and above this at the 20-day EMA.
We shall wait for signs of buying to emerge before suggesting any trade.
Bitcoin Cash is in a firm bear grip. Prices continue to fall as the support levels fail to attract buyers.
The BCH/USD pair has broken down of the April 01 lows of $653. Its next support is at $558.3870.
We shall turn bullish on the digital currency if it breaks out and sustains above the descending channel. Until then, the bears will continue to sell on every small rally.
Ripple is close to the April 01 lows of $0.45351. This is a critical level because the next support on the chart is way lower at $0.22255, which was the low made on December 11 of last year. Therefore, we expect the bulls to strongly defend the $0.45351 mark.
However, if the support breaks, the XRP/USD pair will resume its downtrend and move towards $0.35. With both moving averages falling, we don’t find any buy setups on it.
We shall wait for prices to break out of the 20-day EMA and sustain above $0.56270 before proposing any long positions.
Stellar is close to its critical support level of $0.184. If this support breaks, the digital currency can decline to $0.16 and below that to $0.1125 levels.
If the $0.184 support holds, we may see a pullback to the resistance line of the channel. We like the way the RSI has maintained its positive divergence.
We shall wait for prices to turn up and break out of the 20-day EMA before recommending any short-term trade on the XLM/USD pair. A long-term trade setup will form only if prices break out of the descending channel.
Litecoin continues to fall towards its critical support zone of $114.706 to $107.102. If the bulls fail to defend this zone, prices will sink to $84.708 levels.
If the support zone holds, we may see another attempt by the bulls to break out of the downtrend line and the 20-day EMA.
While the 20-day EMA is falling, the 50-day SMA is relatively flat. So, if the immediate support holds, the LTC/USD pair can enter into a range.
We shall suggest a trade if it breaks out and closes above the 20-day EMA.
Cardano turned down after coming close to the upper end of the range on April 04. We expect it to consolidate between 0.00001690 and 0.00002460 for a few more days.
There are two ways to trade a range. Either buy on a breakout or wait for prices to dip to the lower end of the range. We shall wait for either scenario to play out before suggesting any trades on the ADA/BTC pair.
The longer the cryptocurrency spends consolidating, the stronger will be the next breakout or breakdown from it.
NEO has resumed its downtrend. The bulls are finding it difficult to defend the April 01 lows of $44.84. If the bears sustain below this level, the next major support is at $31.15.
Both moving averages are falling, which shows that the bears are in complete control. First signs of bullishness will be when the bulls break out of the 20-day EMA and the overhead resistance of $63.62.
Until then, we expect the NEO/USD pair to remain under pressure.
EOS broke out of the descending channel on April 05, but the bulls haven’t been able to sustain the breakout. Prices have again fallen back into the channel.
We believe that even above the channel, there will be a hurdle at the 50-day SMA and the last one at $7.28. The coin will become bullish once it clears these overhead resistances.
Among the top cryptocurrencies that we analyze, the EOS/USD pair currently has the best looking charts and the highest probability of starting a new uptrend. Therefore, we recommend a buy at $7.5, keeping a stop loss of $5. Our target objective is a move to $11.
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Author: Rakesh Upadhyay