This is from the newsletter emailed out 10/17/2017. If you haven't already, sign up for your free newsletter at https://nodeinvestor.com.
After hitting $5900, Bitcoin has been consolidating over the past week. The question I'm getting a lot right now is "Are the altcoins going to get hit again during a Bitcoin rally?" No doubt many of the altcoin/BTC charts look very bearish and have significantly under-performed throughout October.
However, I'm starting to see more and more signs of a low being put in. We're already seeing some rallies and attempts to move up. Ethereum and Litecoin were the first movers and this week's we've seen more names going higher.
For now, BTC is still the best place to be overall but I also believe the alts are well overdue for a bounce and that it's a good time to start positioning a portion of the BTC portfolio into some of the better altcoin names. I am seeing more attempted rallies now and this is a good early indicator that the lows may be in. The test will be on a move higher in Bitcoin. If the alts can at least hold par with a BTC rally, we could begin to see them outperform shortly thereafter.
In my last video, I explained some of the bottoming signs to begin looking for in the altcoins. The video is linked below.
Let's take a look at some of the charts.
Bitcoin Chart
The consolidation continues to help work off some of the overbought conditions in BTC. Overall, it still looks very strong. A move above $5800 now may signal a push higher. Will we see $6000 this week!?
On the daily chart, it's still extended but the 10 EMA is catching up quickly. We may see another day or two of consolidation before the next move.
On the downside, $5400 is good support right now and below that, around $5200.
NEO Holds Support
After breaking below .0075 on the BTC chart, NEO saw a quick and steep decline. Over the past couple of days, it’s attempting to put in a low and is bouncing off of key support levels and oversold conditions. I believe the low is in and this may be a great place to look at it for longer term holdings.
I'm a believer in the project long term and expect it to make new highs ultimately. In the intermediate term, it could continue to consolidate below 0.0080. A break below the 440k sat level would confirm a failed rally attempt.
Ethereum
The chart above is the ETH/USD daily chart. After breaking out above $314, ETH quickly rallied to the next resistance level at $340 where a lot of sellers showed up. The hard fork on the project is now successfully complete and ETH has been pulling back to the breakout point.
This could offer a secondary entry point. However, a break below here would likely send prices down to the high $200's. Versus BTC, a move back above the 0.065 level would be bullish and could lead to ETH out-performing. For now, it's still weaker than Bitcoin.
Litecoin
The price action in Litecoin has been very similar to Ethereum and is also pulling back to the breakout point. For longer term holdings, I think this is good entry with a stop loss below the $50 range.
QTUM Putting in a Low
The chart above is a closer look at QTUM with the 4-hr time-frame. It held the lows around 175K sat and is now moving higher with good volume. Just today, it's breaking above a little bull-flag. Longer-term, this is one I believe has high potential and should be on your radar. The USD chart also looks strong and break above $12.70 would be a nice breakout.
Small & Mid-Cap Names
Metaverse (ETP) is newer name that has shown resilience during the past month. It's definitely overextended near-term but a consolidation could offer a good entry point for a longer term hold.
There are many smaller cap names attempting to put in a low here. Some to watch are: CVC, PAY, MCO, ADX, VTC
Bigger names include: OMG, BCC, XEM, XMR, ZEC
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