The cryptocurrency rally continues to look good, although some all-too-familiar resistance levels are proving a drag. Meanwhile shorts are at all-time highs.
Our red uptrend remains in place, within the big purple bull pennant. So far so good. Daily MACD is crossing bullish (a theme in today’s charts as you’ll see) showing momentum is definitely on an upswing here.
The only real amber warning sign for bulls is the series of hesitation candles the last four days (indicated) – symptomatic of some very familiar resistance in action.
Zooming right into the hourly chart, we can see where these daily hesitation candles have come from – BTC has been trapped in-between resistance and support from our old friend the gap (yellow dashed), forming a decision triangle.
What bulls are looking for, quite obviously, is a break out of both the top of the decision triangle upwards on decent volume and a break above the $6545 gap top. Things should get a lot more interesting after that.
Things aren’t looking short-term bearish, but that view would be up for reassessment on a break under the gap bottom ($6435). Only just over $100 of price difference differentiates the two signals, gaps are a wonderful thing.
ETH is in theory looking good for a run up to the red downtrend at $250. A little concern from the high volume spinning top indicated, as the volume behind that will be causing significant resistance at the top of the candle (around $224) – hence the two hesitation candles since.
Bears will be seeing this as price turning over at a Fibonacci retrace line (around the 50% line, not shown) for a continuation lower – but MACD, the hourly chart and the rest of the market currently looks bullish biased, so I’m doubtful that’ll play out.
Seen close-up, the last 2-days hesitation are forming an ascending triangle. These break bullish around 70% of the time.
Another MACD bull cross lining up for XRP. The bullish divergence between price action and RSI/MACD remains in place and we’re still up above the downtrend. Bulls haven’t managed to knock this out of the park yet, and there’s a yellow gap resistance just above between 0.30 and 0.31, but I still like the look of this chart. It feels ripe for a dramatic breakout.
Another ascending triangle. Bullish. $0.30 gap (T1) above, yellow dashed.
Yet another MACD bull cross right now. That divergence clearly visible again, and again hesitation candles. Like BCH below, LTC is still under its downtrend so we wouldn’t normally call this a bullish chart yet, but given the correlation between coins and the fact BTC clearly is above its downtrend, I’m discounting that as a signal.
Above us is gap resistance $57.20-$57.50 followed by price resistance at $58, then it’s clear sailing up to the downtrend at $65 (blue here).
Ascending triangle visible here again, albeit slightly less clear that the others. The effect of the yellow (gap) and green resistance bands on the price action the last few days is clearly visible.
I’ve spotted a down-channel on BCH, which is at odds with the BTC uptrend recently. Still, when everything finally gets out of this resistance quagmire and bears properly throw in the towel (more on that below) I’ve little doubt BCH will follow suit. Resistance at $551-556 (yellow gap), then 50 day moving average at $566 (not shown). T1 is in red, around $600.
Another ascending triangle. The BCH picture is complicated by the fact it’s still at/ below a fair amount of resistance; if you can squint you can see an attempt at an inverse head and shoulders formation, but we’re still below the neckline. Could continue to underperform short-term.
Finally, just to give the bulls some cheer, I’m including the BTC and ETH shorts charts. These, as a reminder, are fairly reliable contrarian indicators. BTC shorts are still close to an all time high, and ETH shorts are at an all time high – so high they’re interfering with our logo ;).
The maquis have a serious arms stash. When the market finally breaks free expect fireworks.
BCB Group has no position or opinion on the price of Bitcoin or any other cryptocurrency and this article should not be construed as analysis of or advice regarding the current or future market price of Bitcoin or any other cryptocurrency. No analysis of the price movements of BTC or any other cryptocurrency or any other asset provided by BCB Group should be construed as an invitation or inducement to buy, sell or otherwise to trade BTC or any other cryptocurrency.
Jon is BCB’s head strategist, with an emphasis on market intelligence. An expert in behavioural science and highly experienced chartist, Jon has been providing BCB’s clients with crypto and macro technical analysis since 2017, and has quickly gained a reputation for accuracy after accurately calling the December 2017 top and August 2018 bottom.
Jon is also MD of British music production company Poseidon. He began studying technical analysis in 2000 due to its overlap with behavioural economics – much used in Poseidon’s international marketing work, which has seen the company achieve three iTunes US number one albums among other notable successes.