Price Analysis 02/08: BTC, ETH, XRP, LTC, BCH, BNB, EOS, BSV, XLM, ADA
Bitcoin is looking strong. Can it start a rally? What are the target levels to watch out for? Let’s analyze the charts.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Market data is provided by the HitBTC exchange.
Fundstrat Global Advisors co-founder Tom Lee expects Bitcoin to reach $20,000 this year. He believes that increased liquidity due to the Fed’s rate cut will drive money into risk assets that will help the leading cryptocurrency. Bitcoin will also work as a hedge due to its low correlation to other asset classes.
Echoing a similar sentiment, a report by research firm Delphi Digital pointed out that the major central banks have turned dovish, which is bullish for Bitcoin. The report also predicts that Bitcoin’s market capitalization might outgrow that of gold in the future.
Anthony Pompliano, co-founder of asset manager firm Morgan Creek Digital Assets, has gone a step ahead and said that the central banks, who are now buying gold to diversify their assets will buy Bitcoin due to its “non-correlated, asymmetric upside profile.”
Global Macro Investors and Real Vision Group founder Raoul Pal believes that rewards far outweigh the risks for Bitcoin in the long-term. According to him, Bitcoin can hit $8 trillion in market capitalization in the future compared to its current market capitalization of about $187 billion. He does not expect any other asset class to provide such astronomical returns.
Bitcoin (BTC) scaled above 20-day EMA on August 01 for the first time such July 14. This is a positive sign but it might face some resistance at 50-day SMA, above which it can rise to the downtrend line. We anticipate strong selling at the downtrend line, but if bulls break above it, a retest of $13,973.50 is possible. Therefore, traders can take positions as suggested in an earlier analysis.
If bulls struggle to propel the BTC/USD pair above the downtrend line, partial profits can be booked and the stop loss on remaining positions can be raised to breakeven. The traders should turn cautious if the price fails to breakout of the downtrend line because there is an outside chance of formation of a bearish descending triangle pattern. The pattern will complete on a break below $9080.
Though Ether (ETH) is attempting a bounce, it lacks momentum. This shows weak demand at higher levels. The bulls might face resistance at 20-day EMA and above it at $235.70. If this level is crossed, the pair might pick up momentum and rally to $320.840, with minor resistance at 50-day SMA, which is likely to be crossed. Therefore, traders can initiate long position as recommended in our earlier analysis.
Our bullish view will be invalidated if the ETH/USD pair turns around from the 20-day EMA or $235.70 and plummets below the uptrend line. A break below $192.945 will resume the down move. The next target on the downside is at $149.935.
The 20-day EMA is flattening out and RSI is gradually climbing towards the center, which shows the possibility of a range formation. This ambiguity is likely to be resolved within the next few days.
XRP has once again retreated from 20-day EMA, which is a bearish sign. This shows lack of buyers at higher levels. Both moving averages are sloping down and RSI is in negative zone, which suggests sellers are in command.
The first support on the downside is at $0.30 and below it $0.27795. A breakdown of $0.27795 will be a huge negative that could drag the price to $0.19.
Conversely, if the XRP/USD pair rises above 20-day EMA, it will indicate strength. The pair is likely to pick up momentum above $0.34229. We recommend traders wait for the price to turn positive before buying.
Litecoin (LTC) broke out of the downtrend line and 20-day EMA on July 31, which is a positive sign. It indicates a likely change in trend. Though the downtrend is over, we anticipate the uptrend to start only above $105.676.
The 20-day EMA has flattened out and the RSI is just below 50, which points to a likely consolidation in the near term. This view will be invalidated if the LTC/USD pair breaks out and closes (UTC time frame) above $105.676. Such a move might result in a rally to $140.345. On the other hand, if the price falls below 20-day EMA, bears will attempt to sink it to $83.54 once again. If $76.7143-$83.65 support zone breaks down, the trend will turn negative. We will wait for the bulls to assert their supremacy before suggesting a trade in it.
Bitcoin Cash (BCH) is showing hesitation at the overhead resistance of $345.80. If bulls scale this level, it will complete an ascending triangle pattern, which is a positive sign. As it is a reliable pattern, traders can enter long positions as suggested by us in an earlier analysis. The target objective is a rally to $440.37.
Conversely, on the long-term time frame, we find a bearish head-and-shoulders pattern developing that will complete on a breakdown of $227.70. If bulls fail to push the price above $345.90, the BCH/USD pair will be at a risk of breaking below the uptrend line. If that happens, it could drop to $251.23 and below it to $227.7. The price is at a critical level and we should see a decisive move in the next few days.
Binance Coin (BNB) has risen close to the uptrend line. If bulls can ascend the level and sustain it, it will be a positive sign. A break above $32.6 is likely to resume the uptrend, which might carry the price to lifetime highs of $39.5941. We will suggest long positions if the price is sustained above the uptrend line for three days.
As the cryptocurrency has been a huge outperformer in 2019, we expect it to continue its bull run if sentiment improves. But if bulls fail to sustain the BNB/USD pair above the uptrend line, the price might dip back to $24.1709. If this support cracks, the trend will turn bearish because the next support is far lower, at $18.3.
EOS has been trading close to 20-day EMA for the past two days. The support from uptrend line is just below the current level. If the price bounces off the uptrend line and breaks out of $4.8719, it will complete an ascending triangle pattern that has a target objective of $6.4438. We might suggest a long position on a breakout and close (UTC time frame) above $4.8719.
On the other hand, if the EOS/USD pair breaks below the uptrend line, it could fall to $3.8723 and below that to $3.3. On the upside, if the pair fails to break out of $4.8719, it might remain range-bound for a few days. The flattening moving averages are pointing towards a possible consolidation in the short-term. We anticipate a decisive move within the next few days.
Bitcoin SV (BSV) is trying to break out of 20-day EMA and the resistance line of the descending channel, which is just above it. If the price closes (UTC time frame) above the channel, it will indicate a possible end of the downtrend.
Both moving averages are flattening out and RSI is rising to the midpoint. This suggests that the BSV/USD pair can remain range bound for a few days. The boundaries of the range might be between $136.890 and $188.690.
A breakout of this range can carry the price to lifetime highs of $255.620 while a breakdown of the range can result in a drop to $107. We do not find any reliable buy setup at the current levels, hence, we suggest traders remain on the sidelines.
The volatility in Stellar (XLM) has dropped in the past five days as the price has remained in a tight range. This shows indecision among both buyers and sellers. We should see volatility expand in the next few days but it is difficult to predict the direction of the breakout.
The downsloping moving averages and RSI in negative zone show that bears have the upper hand. This suggests that the XLM/USD Pair might break down of $0.072454 and start a new downtrend.
However, $0.072454 is strong support from where the price had bounced in early-February. Hence, we expect bulls to defend the level aggressively. The first sign of bullishness will be a break above 20-day EMA but the pair might pick up momentum above $0.10. As there is no clarity as to the next move, we remain neutral.
Cardano (ADA) has broken down of the symmetrical triangle. While this is a bearish sign, we will wait for the price to close (UTC time frame) and sustain below it to turn negative because in many cases, the first break turns out to be a trap.
If the ADA/USD pair closes below the triangle, it can drop to its pattern target of $0.041. There is support at $0.0501579 but it might not hold because the downtrending moving averages and RSI in negative territory shows that bears are in command.
On the other hand, if the pair reverses direction and break out of the triangle, it will indicate that the current break was a bear trap. If that happens, the price might move up to 50-day SMA. For now, we will retain our buy recommendation given in an earlier analysis. We will withdraw it in our next analysis if the price sustains below the triangle.
Market data is provided by the HitBTC exchange.