08/19/2018 |
Market Update Into 8/20: Cryptocurrency Technical Analysis
A prepared trader is a profitable trader, and Sunday is a great day to get ready for the week ahead. This weekend, we are focusing on the cryptocurrency sector as it has been slammed over the last two weeks. We are paying attention to the weekly candle here for the potential confirmation of a short-term bottom. As always, any of these setups can continue to break down rather than reverse so it is important to use TrendSpider’s dynamic alerts to stay ahead of the action.
Ticker #1: ^BTCUSD
Short-term technical setup: daily vs. 60-minute candle
Bitcoin tried making an attempt at the daily SMA (50) but pulled back hard on Saturday. The price continues to trade in a very tight range on the shorter-term time frame with price trading right around the moving averages on the 60-minute candle.
Long-term technical setup: weekly candle
The weekly candle setup continues to show a wedge starting to form with support of the wedge being previous resistance from the massive run up last year. The candle close was also decent this week with a tweezer bottom type setup. If the price does start to break out from here, watch a potential retest of the SMA (50) and wedge resistance above around $8,000. One thing to notice as well is Bitcoin held its value much better than the other coins during this recent move down.
Ticker #2: ^ETHUSD
Short-term technical setup: daily vs. 60-minute candle
Ethereum has taken one of the harder hits in crypto over the last two weeks as the price dropped significantly in a very short amount of time from $400 to $250. The chart setup still shows a rather strong downtrend on the daily candle with the price trading in a narrow range. Previous resistance on the 60-minute candle is now acting as support below as the price breaks down through the moving averages.
Long-term technical setup: weekly candle
Ethereum’s drop can really be seen on the weekly candle after the symmetrical wedge broke down hard at the end of July. The price is now trading essentially right at the extended wedge resistance area which is now technically acting as support.
Ticker #3: ^XRPUSD
Short-term technical setup: daily vs. 60-minute candle
Ripple has taken a similar hit as Ethereum over the last couple of weeks with price breaking down through the .30 psychological support level. Similar to Bitcoin, the price found support right at the previous resistance area before the blast-off last year. If the price does find a bottom at this area, look for a test of the SMA (50) above around .41.
Long-term technical setup: weekly candle
The weekly candle setup is looking rather strong as the other cryptos are as well. TrendSpider’s automatic candlestick pattern recognition caught the hammer pattern that formed for last week with the price bouncing from lows hit last week. This could be a sign selling is drying up and buyers may start to step back in.
