Weekly Cryptocurrencies technical outlook - April 15.
The crypto market bounced off multi-week highs on the back of taking-profit action. The bulls failed to continue the impressive rally which started in the previous week, and most of the coins slipped back to local support levels. Despite the pullback, Bitcoin maintained the leadership role with the overall market cap of almost $90 billion and total trading volume of nearly 30%. Bitcoin price held the barrier of $5000, which is mainly positive in the medium-term perspective. The weakest cryptocurrencies were Bitcoin Cash and Litecoin, losing 11% and 15% respectively. Sellar and Ripple softened by 10% in the last seven days. Ethereum and EOS printed lowest losses, while Binance Coin and Tether managed to appreciate. Ethereum and Ripple kept the second and third position in terms of market cap. The overall impression from the weekly price action was that crypto investors are gathering momentum for the second round of bullish rally before Easter holidays as the risk appetite remained comparatively stable in the financial markets across the globe.
Bitcoin price pulled back towards 13-days exponential moving average, which worked as the support curve on April 11. The dotted green median line comes around the same levels currently, pointing to the angle of the ascending formation. Fast RSI oscillator went off the overbought territory but remained well above the 50% level, showing strong bullish momentum. Another significant achievement was that the price did not fell below $5000 level, which is robust psychological horizontal support. BTC/USD is still on the track to re-test the local resistance of $5655, and the bulls need some fundamental trigger to spike the buying pressure as the technical background is ready to continue the uptrend. Shorter timeframes might give a closer picture in terms of intraday depth for new buy-and-hold positions.
Ethereum went back to the middle of the recent ascending channel. Williams %R oscillator dropped to -50%, showing that the overbought conditions are out of the game. ADX and DI indicator is still pointing to strong bullish momentum as its main line was edging up far above the threshold. Although +DI and -DI lines narrowed the real surplus, the upside risk is still on the table. We expect ETH/USD to re-test the resistance level of $178.73 and $196.61 in extension. On the other hand, there is a threat of forming a reverse head-and-shoulders pattern on the daily timeframe if the second test of the resistance range failed to print higher-highs sequence. This is why the daily close above $181.45 is crucial to continue the uptrend. Otherwise, a deep retracement might happen.
Litecoin printed the deepest retracement among major cryptocurrencies. That’s the price the bulls must pay for the overperformance noticed in the previous week. However, the uptrend is still in play due to several technical conclusions. First, the Ichimoku Cloud trend indicator is still bullish; the span is full and confident, all of the three lines are placed in the correct order to proceed with the uptrend. Second, the bears failed to close the day below Ichimoku’s Base Line, which worked as the support line, even though there were several whipsaws below it. Third, the 25-days exponential moving average continued its supportive function, as Litecoin price is well above that curve. We’d buy Litecoin right by the market price as the number of long downside shadows points to the fact that the bears are weak, while the bulls use the buy-dips trading strategy, limiting intraday losses. LTC/USD should renew its bullish rally with the same medium-term targets as we used to point out earlier. We would not take profits earlier than the second test of $100 would happen. The only question is how fast will the crypto market get there.
Binance Coin tested the median trendline support last week. Bollinger Bands indicator with a modified period of 34 days shows that the latest bullish breakthrough signal was not worked out yet and we should see higher prices than the recent top of the market. Moreover, the BB middle line worked as support, limiting daily close price for further slide (green arrow) which was strong buy signal charted on last Thursday. Once the psychological round-figure resistance of $20.00 is eliminated, the bulls will target all-time highs around $26.5, which should happen sooner rather than later.
Although the overall technical sentiment remained positive, the lack of further bullish gains does not allow us to suggest significant bullish achievements in the nearest future. The main problem was that EOS/USD stopped the upside rally in the middle of the yellow sideways range without even testing highs of $6.70. The Parabolic SAR indicator turned the sentiment to bearish as its dots jumped above the price. On the other hand, the upside risk persists as long as prices remain above the blue horizontal static support at $4.51. That level might be used by EOS bulls to renew the buying pressure, even though a sideways range is more likely rather than a bullish breakthrough.
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