Weekly Technical Views on Crypto Pairs
18 March 2019
Exhibit 1: BTC daily prices with 100 day average.
BTC/USD (CMP: $4093)
Bitcoin saw a devastating fall in mid- to late- November last year, but since then it has been consolidating for the past several months. This consolidation is technically encouraging for the battered bull in this premier Crypto pair. During this process, Bitcoin has quite visibly established a prominent supply zone at around $4200 levels and failed to go past above it.
Speaking technically, there are many trapped bulls in that regions who want to exit at par when they get back their prices. It is noteworthy to mention that with each such attempt, their numbers are dwindling and sooner than later there will remain no such trapped bulls, implying the supply will exhaust. We also expect many stop-buy orders above this region that could fuel a rally once Bitcoin manages to consume all the supply at this important resistance level.
We also observed the late February phenomenon of BTC’s euphoric surging ahead of its 100 Day Average which conveys the message that distress selling is most likely over. Following that event, prices have mostly stayed above this important mark & Exhibit 1 shows that prices in fact got support from this line multiple times in the past one month. We are not expecting this 100 day average line to be broken in near future.
In addition, prices are making higher bottoms and the last such bottom was done at around $3806 mark. It is therefore a market to buy on declines with stop loss at this important level (as violations of $3800 will temporarily terminate the existing minor uptrend) unless the breakout occurs above $4200 mark.
Exhibit 2: Daily Chart of Litecoin along with 14 day RSI and 200 day average
Litecoin/USD (CMP: $60.3)
In an overall gloomy picture in the Crypto universe, Litecoin is a shinning exception. Not only it is outperforming all other pairs, it is in fact embarking on a Primary uptrend and we are expecting higher prices ahead.
The following technical evidences are put forward for a potential bullish forecast. Firstly, Exhibit 2 shows that prices are putting up consecutive higher bottom formations, which is a primary requirement of any uptrend. Secondly, prices are not only above their 200 day average but the average itself is changing its slope from down to flat. And thirdly RSI (14) is staying significantly above its halfway mark (50) and in fact meandering in its overbought regions, which is another assertion of strength.
Immediate support for Litecoin is at $55 mark and one could use it as a stop loss for long position. A breakout above $62 will likely push prices to an even higher orbit.
