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Market data is provided by the HitBTC exchange.
Since 2013, Bitcoin has seen a sharp rally in the last quarter of every year, barring 2014. In 2013, the rise was 486.74 percent, in 2014, the leading cryptocurrency declined marginally by 16.69 percent. In 2015, the gain was 81.24 percent, while in 2016 the rally returned 58.17 percent. In 2017, the up move rewarded investors with a gain of 215.28 percent.
To quote Mark Twain, “History doesn’t repeat itself, but it often rhymes.” As traders, we respect the seasonal trends, therefore, we will be on the lookout for buying opportunities in the last quarter of this year. Of course, we won’t take a trade until we see a reliable buy setup.
The fundamentals of the sector continue to improve with large brokerages, banks, and nations coming forward to encourage blockchain technology and cryptocurrencies. Barring any adverse news, the trajectory should be higher in the next three months. So, which digital currencies are signaling a change in trend? Let’s find out.
We assume that traders who follow us will have initiated long positions in the range of $6,600–$6,750, as suggested in the previous analysis. The pullback in Bitcoin stalled at $6,831.99 on September 18.
Currently, the BTC/USD pair has corrected back to the support level of $6583.46. Both moving averages are located at this level, so this becomes a critical support to watch.
If the bulls defend this level and a bounce materializes, a move to the downtrend line of the descending triangle is possible. The virtual currency will pick up momentum if the price sustains above the downtrend line.
On the other hand, if current support breaks, a retest of the $5,900–$6,075.04 support is likely. Traders should keep the stop loss at $5,900 because if support breaks, a deeper fall to $5,450 and further to $5,000 is probable.
Ethereum broke out of the descending channel on September 21 but is finding it difficult to sustain the breakout.
The ETH/USD pair is currently back at the downtrend line of the channel, which should act as strong support. The 20-day EMA has flattened out and is also located at this level. Hence, this becomes a critical support level to watch.
If support breaks, the digital currency cоuld slide to the $192.50 level once again. However, if support holds, a rally to the $302 is possible. We currently don’t see a reliable buy setup, so we are not suggesting any long positions.
We suggested traders not to chase the rally higher in our previous analysis. Our recommendation was validated as Ripple started a correction after reaching the intraday high on September 21.
As the XRP/USD pair has broken out of the downtrend line and both moving averages have completed a bullish crossover, we believe that the trend has changed. Traders should now look for buying opportunities on dips. What are the key levels to watch out for?
The 50 percent Fibonacci retracement of the recent rally is at $0.51676, which has been acting as a strong support. If this level breaks, the correction can deepen to the 61.8 percent retracement level of $0.45832. If the new trend gains traction, the pullback should end at either of these two levels.
We will watch for the next couple of days and then take a call on a long position. Our bullish view will be invalidated if bears force the price below the downtrend line.
Bitcoin Cash failed to reach the 50-day SMA. It turned down from just above the $500 level on September 22. The trend remains down as it is still trading inside the descending channel.
The 20-day EMA is flat and the RSI is close to the midpoint. This points to a likely consolidation in the near-term.
If the BCH/USD pair falls below $450, it can retest the low at $400. On the upside, the critical levels to watch out are the 50-day SMA and the downtrend line of the descending channel.
We will wait for the trend to change before suggesting a trade.
Bulls could not build on the breakout of the overhead resistance of $5.65. EOS did not rally as we had anticipated, and turned down from $6.3117 on September 22.
EOS is currently retesting the breakout level of $5.65. Support from the moving averages is just below the current level. If support holds, the EOS/USD pair will again try to rally to $6.8299.
If the current support breaks, a decline to the next support at $4.50 is probable. The digital currency has formed a continuation head and shoulders pattern, which will complete on a break below $4.4930. Therefore, we suggest traders keep their stops on the long position at $4.40.
Stellar touched a high of $0.30434761 on September 23, just below its target objective of $0.3157505. Though the bulls broke out of the downtrend line of the descending triangle, they could not sustain the higher level.
Currently, the XLM/USD pair has again plunged back into the descending triangle, which is a bearish sign. It has support at $0.24987525 and below from the moving averages. A fall below $0.21 could result in a retest of the critical support at $0.184. Therefore, traders who are long on our recommendation can trail their stops to $0.21.
The virtual currency will pick up momentum if the bulls can push it above the intraday highs of September 23.
The pullback in Litecoin hit a roadblock at $63.650 on September 23. It is currently trying to take support at the moving averages.
The LTC/USD pair is currently in a consolidation between $49.466 and $69.279. Both moving averages have flattened out and the RSI is at the midpoint, suggesting that the range bound action might continue for a few more days.
A breakout of the overhead resistance will complete a double bottom pattern, which has a pattern target of $89. A break below the moving averages could sink the digital currency back to the bottom of the range. We recommend traders attempt a long position only on a breakout and close (UTC time frame) above $69.279.
Cardano could not break out of the 50-day SMA on September 23, resulting in a pullback to the 20-day EMA.
If support holds, a rally to the $0.111843 level is likely. On the other hand, if the bears sink the ADA/USD pair below the 20-day EMA, a fall to $0.071355 is probable.
Both moving averages are flattening out and the RSI is in neutral territory. We do not find any reliable buy setups at the current level, so we are not proposing a trade.
Monero has pulled back to the 20-day EMA, which should act as a strong support. If the bulls secure a rebound from the moving average, a rally to $140 is probable.
The XMR/USD pair is currently stuck inside the symmetrical triangle. A breakout of the triangle and $150 might start a new uptrend. Therefore, traders can keep the stops on their long positions at $100.
If the 20-day SMA and the 50-day SMA fail to provide support, a retest of the $81 level could be possible.
Dash has earned a place in our analysis as it has climbed to the tenth spot and has been maintaining the price for the past few days.
The DASH/USD pair bottomed out at $130.024 on August 14. Thereafter, it rallied to $224.830 on September 1, a gain of about 73 percent. Currently, the 20-day EMA is providing support, below which a fall to the 50-day SMA is probable.
We anticipate a consolidation between $130.024 and $224.830 over the next few days. The virtual currency will start a new trend if the bulls scale and sustain above $225. Until then, we suggest traders remain on the sidelines.
Market data is provided by the HitBTC exchange. Charts for analysis are provided by TradingView.