The cryptocurrency market continues the current bullish run after bottoming out late December. It's not quite certain whether the current rally is another bounce or a major recovery is ready.
February 19, 2019 | AtoZ Markets - The crypto market is looking enticing again after gains recorded before the turn of the year continue. Knowing where digital currencies will bottom is a near impossible task but we can follow up as price moves in whatever direction it does. The price patterns leading upside suggest two things: a possible major recovery leading to a new all-time-high or another bounce leading to a new low. These are the two major scenarios that have divided opinions of traders, analysts, investors and other crypto market enthusiasts
Tim Drapper, a billionaire crypto bull has held on to his 2017 prediction that Bitcoin will hit $250,000 by 2022. Another ambitious Bitcoin bull, Zhu Fa, co-founder of Poolin, a chinese based crypto mining pool, predicted the next bull phase to reach $738,000. Far less ambitious was the CEO of digital currency investment firm BKCM LLC, Brian Kelly who predicted that Bitcoin is currently 50% undervalued. However, he hopes price could come up to its real value but the negative sentiments surrounding the market means the bears might still drive it to $1,500. It remains to be seen whether the next bullish phase has started or not. While we ignore the long term potential for a while, let's look at the short term technical price forecast of the major cryptocurrencies.
BTC/USD technical analysis
Bitcoin broke above 3700 this week to point upside. Price might be heading to 4400 in the short term. Crypto short term bulls should be wary of 4400-4600 resistance zone. At this zone, the sell-off might resume yet again, leading to a fall below 3100 low. If price surges above the zone and hit 5000, then there is a strong case for a bullish recovery. Bitcoin currently exchanges for $3,900.
ETH/USD technical analysis
Just like Bitcoin, Ethereum is also pointing upside after the 8th February upside break. Early this week, Ethereum gained a big 13% to be the biggest gainer so far this week. Price is currently around 150 - between the year high and low of 166 and 101 respectively. Price is closing up with 166. We will most likely see further rallies to 190-200. However, just like Bitcoin, it's premature to talk of total recovery at this stage. Price might just be making another bounce, many of such we saw last year. A zigzag within a channel might complete just at or below this resistance zone (190-200) before price start a new bearish wave below 82, down to 50 or even lower. If the rally rather breaks above 200 swiftly, we will be counting a bullish impulse wave instead to 350 or higher. Ethereum still remains the 2nd most capped crypto after Bitcoin, and is said to have the potential to stay independent of Bitcoin.
XRP/USD technical analysis
Ripple has also gained since the 8th February breakout rally. However, the gain has been very much limited compared to BTC and ETH. In fact the price chart of Ripple, might make one to reconsider the idea of a recovery. After making its way up from 0.28 to 0.46, it dropped to 0.28. However, the rally from 0.28 still looks corrective and price might just turn around and drop below 0.28 again to make a new low. With the bullish possibilities of BTC and ETH, one might predict further rallies to 0.466 or below in the nearest term. Ripple is the 3rd most capped crypto asset and currently trades at 34 cent.
LTC/USD technical analysis
Litecoin often moves similarly with BTC and there is no much different in movement in the last two weeks. However, LTC is indicating the imminent completion of a zigzag corrective pattern while same pattern is developing on BTC. The chart above shows the possibility of an ending dagonal mouth completing this pattern at 51-52. If this pattern completes as expected, another flash fall might follow below 22. A break into 61 will violate this pattern and add momentum to the short-term bullish sentiment.
In conclusion, judging by the wave and pattern analysis of these main cryptos, the bullish-bearish sentiment is still 50-50. Therefore, talk of recovery looks premature since the larger bearish sentiment still persists.
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