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The cryptocurrency universe has divided experts right in the middle. While one group says that digital currencies are in a bubble, the other group says this is only the start of a multi-year trend.
While it’s good to know others’ perspectives, we shall focus on the chart and chart patterns to forecast the next probable direction. The markets may move against our assumption several times, therefore we always advise a stop loss, because the first loss is the best loss.
So, let’s get down to analyzing charts.
Bitcoin’s expected SegWit2x hard fork did not materialize, which led to large-scale dumping of the cryptocurrency. This awakened the sleeping giant, Bitcoin Cash, which surprised everyone with its huge vertical rally.
Instead of Ethereum flippening Bitcoin for the leader’s position, Bitcoin Cash flipped Ethereum to take the second spot. However, gravity caught up with Bitcoin Cash helping Ethereum regain its number two spot.
Meanwhile, experts continue to provide bullish forecasts for Bitcoin, both for the short-term and the long-term.
Bitcoin has entered a bear market and most of the news around it has turned bearish. Experts are speculating about the future of cryptocurrencies and what can be done to reduce the volatility.
However, we believe that a 30 percent fall after such a stupendous rally this year should not come as a surprise. There have been many such corrections in Bitcoin’s journey to $5,000 and investors who had the stomach to sit through it have been rewarded handsomely.
Nevertheless, it’s difficult for many to digest this volatility and they prefer to trade the short-term swings. For such traders, we provide critical levels that can be kept in mind while initiating a trade. Let’s see the latest recommendations.
Last week, cryptocurrencies plunged following news of the Chinese crackdown. Though the fall was sharp, it was short lived. Lower levels gave an opportunity to the eager bulls to make an entry.
So, has the correction ended and will digital currencies again resume their gravity-defying run? Should you jump in right away or will the cryptocurrencies retest last week’s lows?
Let’s look at the charts and find out.
Therefore, traders who have positions from lower levels might want to book partial profits at the current levels. Avoiding fresh positions seems like a good idea until we see a small dip or a consolidation, which will give a good stop loss point.
However, if the momentum continues and Bitcoin breaks out of $4,086.79, it can rally to $4,630.19.
Among the top four cryptocurrencies, Bitcoin has taken the lead and is marching ahead, making lifetime new highs on a regular basis, while the others are still far away from their peaks. Nonetheless, Bitcoin has pulled the whole cryptocurrency universe along with it. The total market capitalization of the 843 digital currencies has reached above $132 bln.
So, can this bullish trend continue or are we looking at another correction in the short-term? Let’s see what the chart patterns tell us. We start with the leader – Bitcoin.
