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Weekly Cryptocurrencies technical outlook - May 13

The crypto market soared like a rocket, flying sky-high. Although the price action was comparatively quiet throughout the whole trading week, and most of the altcoins were hovering around the same price levels as in previous weeks, Saturday’s action brought the launch. Finally. For instance, the leader among cryptocurrencies - Bitcoin - surged above $7300 (at the time of writing). Breaking through several technical resistance levels, like a hot knife goes through the butter. Bitcoin price strengthened almost 27% in the last seven days, and the price action is wild, promising more gains as the market situation changes every hour. Bitcoin’s market cap exceeded $130 billion, breaking records rapidly, while the trading volume is in the usual range around 30% of the whole crypto market. Crypto investors did not limit themselves by Bitcoins only. Other leading gainers are Bitcoin Cahs (+28%), Ethereum (+20%) and Litecoin (+18.6%). Even slow-moving EOS and Cardano gained around 13%, while Ripple added only 6% to its price. Tether traditionally held the second place in terms of trading volume (28%), while its rate remained almost unchanged this past week. Litecoin jumped to third place in trading volume for the last 24 hours, while the market cap was approaching $6 billion. Ethereum and Ripple took the second and third place in terms of market cap, accordingly. Although some of the technical charts show that cryptocurrencies are getting extremely overbought, the recent price action leaves the door open to further bullish achievements. Let’s have a look at several charts.

BTC/USD: Bullish

We’ve modified the daily chart setup a bit just to show you how far Bitcoin can go in its bullish run. The main thing is that the technical background was getting the market ready for this rally, which started last Friday and accelerated on Saturday. Two essential editions: first, we’ve added simple moving averages with 55- (orange) and 233-days (blue) periods. The bullish crossover had completed the overall change of the technical sentiment. BTC/USD is officially in the uptrend. The second indicator is supposed to show you how rapidly the market’s momentum surged. The main ADX line edged higher with a sharp angle, pointing to the bullish strength. +DI (green) and -DI (red) lines increased the positive distance dramatically, confirming the bullish trend. As a result, Bitcoin price went through the blue horizontal static resistance ($6779.4), which represents the upper range of the sideways consolidation in August - November last year. We’ve indicated that target several times in our outlooks. Next, BTC/USD breached the psychological round-figure level of $7000, which does not have any significant meaning to the technical analysis. However, crypto investors did not take profits from the rally, suggesting a bullish continuation. At the time of writing, Bitcoin was testing the peak resistance charted on September 4 last year. If the bulls lifted quotes higher and closed the day above that dotted brown line, then we’d see rates testing the next target of $8390. Otherwise, a bounce back down and the retracement is possible. Traders should consider using the buy-dips trading strategy, but not enter on top of the market. Intraday technical levels have to be monitored in this case. 
 

Weekly Cryptocurrencies technical outlook - May 13

ETH/USD: Bullish

Ethereum had already tested the round-figure horizontal resistance level of $200 for the first time since the plunge on November 14 2018 (6 months), but bounced back last Saturday, leaving the long upper shadow on the daily candlestick. However, the bulls preferred to lift ETH/USD higher, and the breakthrough is almost unavoidable. The long-term analysis suggests that the coin is edging to the upper range of the ascending bullish channel, and the nearest target is even higher. We suppose that sellers might fight aggressively for a defensive barrier in a range of $209.52/220.78. We’d consider taking profits there and having the wait-and-see position as a bearish bounce back down is possible if the bears stepped in with heavy-volume selling pressure. At the same time, if the crypto rush continued and investors preferred holding altcoins, a bullish breakthrough would be possible towards $247.82 (the highest daily close price on September 21) and $300 in extension. The only question is in time to reach those targets, and that will depend on the overall risk appetite and news environment. Nonetheless, the overall long-term technical sentiment is definitely bullish, and buy-and-hold trading strategy looks attractive for smart traders. 
 

Weekly Cryptocurrencies technical outlook - May 13

LTC/USD: Bullish

A daily squeezed chart below shows 12 months. Litecoin is testing the market top at $92.94, the highest daily close price printed on April 6. Several technical conditions have to be met before making further conclusions of how fast LTC/USD would move north. First, the bulls must close the day above the recent peak, completing the sequence of higher highs. Otherwise, a double top bearish reversal pattern might be charted with a higher chance of a deep retracement. Second, Ichimoku’s Base Line must get off the span, and edge higher as Conversion Line is already there, pointing to further bullish achievements in the nearest future. The cloud itself previously performed the bullish cross, opening the road for the bulls. Once those factors cleared the path, Litecoin would surge towards the yellow range, which worked as consolidation in May - June 2018. Therefore, the nearest target would appear in the range of $110.90/125.42. There might be a delay around psychological round-figure resistance of $100, but we suggest that it would be short-lived. We’ve also built a support trendline (blue bold), connecting four lowest points recently. The upper trendline is a parallel clone, which was shifted towards the recent market peak mentioned above. As a result, we’ve got an ascending channel, which should work as the road map for the uptrend in the nearest future. Litecoin had been overperforming the crypto market in March - April this year, but recent price action is a bit lagging. Therefore, we would not expect the altcoin to soar rapidly, and the market conditions should give another chance for entry to those traders who missed the opportunity to join the party earlier. The buy-dips trading strategy is the best technique with such technical setup, and Ichimoku’s Conversion Line should work as the support curve. 
 

Weekly Cryptocurrencies technical outlook - May 13

EOS/USD: Bullish

EOS is the slowest cryptocurrency in our outlook. Although the recent price gain was sustainable, the technical sentiment leaves several doubts about the next direction of EOS/USD. The support line we showed you earlier worked well, limiting the coin’s retracement last Friday. An additional support curve represents the bottom line of Bollinger Bands indicator with a modified period of 21 days. As a result of the bullish bounce, EOS rallied to the upper band of the range last Saturday. However, the resistance was not breached yet. Another concern is related to the blue dotted line on the daily chart below. That’s a median, which connects the bottom of the market printed last December with several peaks charted during the bullish trend. It worked several times as a resistance recently, and Saturday’s close price was not an exception. Therefore, the bulls must breach that line clearly. Otherwise, another bounce towards the support range is possible. A breakthrough trading strategy is applicable in case of a positive outcome with the nearest target of $5.8494 and $6.7060 in extension. 
 

Weekly Cryptocurrencies technical outlook - May 13


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