The Bitcoin bulls are upbeat on the coin’s future prospects. Mark Yusko, CEO and chief investment officer of Morgan Creek Capital Management, has a target of $25,000 by end of this year. i believes that the rally will continue and that Bitcoin could reach $500,000 by the end of 2024.
Similarly, Alexis Ohanian, a co-founder of the social media platform Reddit and a VC firm Initialized Capital had recently reiterated his year-end target of $20,000 on Bitcoin and $1,500 on Ethereum.
While we are also bullish, we are much more conservative in our approach. We like to take it one step at a time so as to not get carried away. The aim is to maximize profits for the readers, taking the least possible amount of risk.
BTC/USD
When a strong overhead resistance level is scaled, it is usually followed by a retest of the breakout level. Bitcoin has completed a similar retest of the $7,750 line. This level had been previously acting as a strong resistance, and will now act as a strong support.
A strong bounce from the support level indicates that the buyers were waiting for a dip to buy. Traders who have been waiting on the sidelines to buy on a deeper decline are left stranded. They are likely to jump into the fray once the price continues its journey northwards.
So, if the bulls can break out of $8,566.4, the likelihood of a rally to $10,000 increases, fuelled by the traders who have missed the bus and are feeling left out.
However, it might not be a one-way move, as the digital currency can face resistance at $8,888 and $9,375. Therefore, we suggest traders take partial profits at critical levels. If the bulls fail to scale above $8,566, partial profits can be booked closer to $8,400 and the stops on the long positions that were initiated at $6,650 can be raised to $7,400.
Our bullish view will be invalidated if the BTC/USD pair slumps below $7,750.
ETH/USD
Ethereum has not been able to scale the 50-day SMA for the past three days. It is currently taking support at the trendline.
The ETH/USD pair has formed a small symmetrical triangle. A break out of the triangle increases the probability of a breakout above $500. On the other hand, if the bears force a breakdown, the virtual currency can slide down to $404.
The trendline of the symmetrical triangle has held since July 12, hence, we anticipate a bounce from it again. Therefore, we suggest holding the long position with the stop loss at $400.
XRP/USD
Ripple has been consolidating between $0.4242 and $0.51978 for more than a month. Currently, the prices have been hovering near the bottom of the range for the past six days. This shows a lack of buying at these levels.
If the bulls don’t force a bounce above $0.47 within the next couple of days, the XRP/USD pair might slump below $0.4242. Any breakdown of the range will be a bearish indicator, which can result in a fall to $0.33.