Price Analysis 29/07: BTC, ETH, XRP, LTC, BCH, BNB, EOS, BSV, XLM, ADA
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Market data is provided by the HitBTC exchange.
While large economies are confused on how to handle cryptocurrencies, smaller nations — Belarus, Bahrain, Malta and Gibraltar — have taken the lead. They have created specific rules for the sector and are offering an environment that provides security to investors. If these nations succeed in attracting investments, we expect larger nations to become more receptive to cryptocurrencies.
The crypto markets are currently witnessing a period of low volatility as they wait for a trigger that will either carry the price higher or will result in a fall to the next support level. If the United States Federal Reserve cuts rate in its next meeting at the end of this month, it might boost Bitcoin. As the bottom is in place in Bitcoin and a few other major cryptocurrencies, we view the current fall as a buying opportunity. Let’s spot the cryptocurrencies that have formed bullish setups.
BTC/USD
Bitcoin (BTC) fell close to the critical support of $9,080 on July 28. Though the support held, bulls are finding it difficult to build up on the gains. This shows a lack of buying at higher levels. With the 20-day EMA sloping down and the RSI in the negative territory, we expect bears to make another attempt to break below the support.
If $9,080 breaks down, the BTC/USD pair can plummet to the next support zone of $7,451.63 to $6,933.90. Conversely, if the support holds and bulls manage to push the price back above the moving averages, it might reach the downtrend line. We expect some selling at this resistance. If this is scaled, a retest of the recent highs of $13,973.50 will be in the cards. Hence, we maintain the buy proposed in the previous analysis.
ETH/USD
We like the way Ether (ETH) has held on to the uptrend line. However, unless bulls push the price above $235.7 within the next few days, the support is likely to be broken. With the 20-day EMA sloping down and the RSI below 50, bears hold the advantage in the short term.
If the ETH/USD pair plunges below $192.945, it will resume the down move and can drop to $150. Such a decline will further dampen sentiment and the recovery thereafter might take a long time.
Conversely, if the pair rebounds sharply from the uptrend line and rises above $235.7, it will attract buyers. The first target is the 50-day SMA, but we expect it to be scaled and a retest of $320.840 is probable. Hence, we retain the buy recommendation given in the previous analysis.
XRP/USD
XRP is looking like it will enter a period of extended consolidation in the short term because both the bulls and the bears are playing it safe. The bears do not want to get overly aggressive at current levels because they have not been able to break below $0.27795 since mid-December of last year.
On the other hand, bulls are not buying aggressively because the XRP/USD pair has been an underperformer in the recent recovery and has quickly given back its gains.
Unless the sentiment worsens, we do not anticipate a breakdown of $0.27795. Similarly, on the upside, we expect resistance at the 20-day EMA and above it at $0.34229. As we do not find any reliable buy setups, we remain neutral on the pair.
LTC/USD
Litecoin (LTC) bounced off from close to the 50% retracement level of the rally. However, bulls are struggling to carry the price higher. If the digital currency does not scale above the downtrend line within the next couple of days, we anticipate the bears to make another attempt to break below the support. As both moving averages are sloping down and the RSI is in negative territory, the bears have the upper hand in the short term.
If the LTC/USD pair slides below $76.7143, it can drop to $69.9227, which is the 61.8% Fibonacci retracement level of the rally. If this level breaks, bears will gain a firm hold.
The bearish view will be invalidated if the pair rises above the downtrend line. That will be the first indication that buyers are back in action and a rally to the 50-day SMA is possible. We will wait for the price to sustain above the downtrend line before recommending a trade in it.
BCH/USD
The bears broke below the small uptrend line on July 29, but buying at lower levels helped it recover and close above the line. However, bulls have not been able to push prices higher. This shows that demand dries up at higher levels. If Bitcoin Cash (BCH) breaks below the uptrend line once again, a fall to $251.33 is likely.
Both moving averages are sloping down and the RSI is still stuck in the negative zone, which shows that the bears are in command. If the $251.23–$227.70 support zone cracks, the BCH/USD pair can slump to $166.98. In doing so, it will also complete a large head and shoulders pattern, which is a huge negative. Therefore, traders should not be in a hurry to buy in a downtrend.
Conversely, if the bulls defend the uptrend line and push the price back above the 20-day EMA and $345.80, it will signal strength and will complete an ascending triangle pattern. This has a target objective of $440.37. Though the 50-day SMA will act as resistance, we expect it to be crossed.
BNB/USD
On July 28, Binance Coin (BNB) bounced from the lows, but bulls have not been able to build on it. This shows a lack of demand at higher levels. If the price does not rise above the uptrend line within the next couple of days, the support at $24.1709 will be at risk of breaking down. The next support is way lower at $18.30.
We have been waiting to buy the BNB/USD pair for the past few days because it has been the best performing major altcoin in this recovery. However, buying in a falling market can lead to losses. It is best to wait for the price to form a bottom before entering a trade.
If the price reverses direction from current levels and climbs back above the uptrend line, it will signal strength. We might propose long positions on a breakout above the 50-day SMA.
EOS/USD
EOS bounced from the immediate support of $3.8723 on July 28. This is a positive sign, which confirms buying at support. The bulls should now try to carry the price above 20-day EMA, failing which the bears will again test the $3.30–$3.8723 support zone. A breakdown of this zone can sink the price to $2.20.
Nevertheless, if the EOS/USD pair breaks out of the 20-day EMA, it will signal a possible change in trend. The first target will be a move to the 50-day SMA, above which the pair is likely to start a new uptrend. We suggest traders wait for a bullish setup to form before initiating long positions.
BSV/USD
Bitcoin SV (BSV) dipped into the bottom-half of the descending channel on July 28 but buying at lower levels quickly propped it back up. However, bulls are struggling to carry the price higher.
The BSV/USD pair will weaken if it continues to trade below the 20-day EMA. If the price again slips into the bottom-half of the channel, a drop to the support line of the channel is likely. We anticipate strong support close to $107, which is the low formed on July 15.
The pair will remain in a downtrend as long as it trades inside the descending channel. A breakout of the channel will be the first indication that the trend is changing. Until then, we suggest traders remain on the sidelines.
XLM/USD
Though Stellar (XLM) had dipped below the immediate support of $0.081527 on July 28, the bears could not capitalize on it and the price recovered from the lows. This is a minor positive as it shows buying at lower levels.
However, if the XLM/USD pair does not rise above the 20-day EMA, it remains at risk of dropping to the next support zone of $0.072545–$0.076. The downtrending moving averages and the RSI in the negative territory suggests that the bears have the upper hand.
The first sign of a turnaround will be when bulls scale the 20-day EMA and the recovery will gain momentum above $0.10. We will wait for the price to sustain above the 20-day EMA before suggesting a trade.
ADA/USD
A symmetrical triangle generally acts as a continuation pattern, hence, the breakout is presumed to take place in the direction leading up to the triangle. In this case, Cardano (ADA) has been correcting since hitting a high on June 26. Both moving averages are also trending down and the RSI is in the negative zone. This suggests that bears have the upper hand. The target objective following the breakdown is $0.041.
However, in some cases, the symmetrical triangle also acts as a reversal pattern. For that to happen, the bulls will have to take charge and push the price above the triangle. This will give the ADA/USD pair a target objective of $0.079. We expect the up-move to face resistance at the 50-day SMA and above it at $0.082. If this zone is scaled, a rally to $0.10 will be in the cards.
As downtrends are known for bull traps, we will wait for the breakout of the triangle to sustain and confirm a bottom before suggesting a trade in it. Until then, we remain in a wait and watch mode.
Market data is provided by the HitBTC exchange.