by Jamie Holmes
BTCManager's Weekly Cryptocurrency Outlook highlights the price action and technical indicators on a long-term basis to identify the best opportunities in the largest cryptocurrencies, such as bitcoin, ether, and others.
Bitcoin has dipped below $1200 but the bullish outlook remains intact as last week's dive remained above the conversion line at $1120.66. However, the market could be forming a fractal resistance at $1229.00, which will be confirmed if BTC-USD remains below $1229.00 until May 1. However, a break above $1229.00 this week, or next, should point to further gains and see the market tend toward the fractal resistance at $1350.00. But the conversion line remains flat, suggesting the market will be attracted to the $1120.66 level.
On the other hand, if the week’s price action closes below the conversion line, below $1120.66, then this will provide a bearish signal and see the market test the next support at the base line, around $995.00.
Looking at the daily price action below, a bullish outlook is displayed. For instance, the market is testing the resistance provided by the conversion line at $1185 and a close above $1185 for April 17 will give a strong bullish signal. A close above the conversion line will open up the fractal resistance at $1229.00.
The most recent fractal support lies at $1141.00, therefore sell positions are only justified with a daily close below $1141.00. Even then, the Ichimoku cloud provides a support zone directly below this level, around $1124-$1130. Also, another bullish indication is given by the Ichimoku cloud, which has turned green, however, the cloud needs to fan outwards to provide stronger confirmation.
Ether recovered losses last week, moving away from the low at $42 and tested the $50 handle, with the market rests below this important psychological level at the time of writing. Nevertheless, there is an important bullish indication. The market kissed the Fibonacci retracement level at $43.65 and now continues higher, suggesting a break above $54.97 will open up a move toward $84.61. However, a move below $43.65 or the recent low at $41.01 should see the market test the 50 percent retracement level $30.99.
The appetite for bullish momentum amongst traders may grow this week as the conversion line moves higher slightly. Also, the Awesome Oscillator moves higher compared to last week. Bullish momentum will also be emboldened next week, as a fractal buy level looks to be forming at $41.01. If this week's price action does not touch $41.01 or below, then the fractal support will be confirmed on April 24. The formation of a fractal support generally implies that an upside move will follow, as the market moves along the 'path of least resistance.' After forming a fractal buy level, the path of least resistance is up.
For example, the chart below shows that a fractal buy level was formed in December 2016 at $7.01, which was confirmed when ETH-USD was trading around $10. Following a slow creep upward into February, the market has followed the path of least resistance ever since, that is it has trended upwards.
Traders are increasingly becoming bullish on litecoin in light of the growing likelihood of the activation of SegWit, as well as addition to Coinbase, which would precipitate even more volume for the altcoin, which stands at almost $83 million over the past 24 hours.
Brian, thanks for working hard to add Litecoin to Coinbase! https://t.co/qFDhom55ij
— Charlie Lee (@SatoshiLite) April 16, 2017
As the chart below shows, Litecoin looked to dip deeper below $10.87, invalidating the Fibonacci targets, and tested the $9.00 handle. However, the altcoin has bounced back and the Fibonacci extension targets now provide areas of key resistance and where buy orders make want to take profit.
On the 4-hour timeframe we redraw the Fibonacci levels to account for the recent high at $13.00, and we see that the Fibonacci extension level, 161.8 percent of the rise from $5.90 to $13.00 is $17.38, therefore we look to see limit buy orders around $13.00 with a target of $17.38.
If $13.00 is not broken this week, a fractal sell level will form and likely push the altcoin toward $8.27, short-term equilibrium as indicated by the conversion line in the weekly chart below.
Buyers were in control for the entire week beginning April 10, with an almost perfect bullish Marubozu candlestick displayed. We can use the base and 50 percent levels to get into the ongoing uptrend. We set limit buy orders around $9.30 and $10.68. Alternatively, buy LTC-USD on the breakout of $13.00, as the market should move toward $17.38. The Awesome Oscillator has also jumped higher this week, showing greater growth vis-a-vis last week, suggesting the bullish dominance will continue.
Dash gives a bullish signal this week, as the market closes above the conversion line, prompting long term buy orders around $77.19. Also, we could buy into the upward move around the conversion line, which should provide support this week at $69.10. Buy positions should look to target the resistance at $93.49.
The conversion line (blue) moves higher from $67.24 last week and is above the base line (red) suggesting bullish momentum will dominate.
However the Awesome Oscillator has turned red and continues to move lower, setting up a potential sell signal for next week.
Monero tried to gain a hold of the $23.00 handle, but buyer were pushed back from the high at $22.90 to $20.89 on April 16. Last week’s price action forms a slightly bearish doji, the second such doji in the space of three weeks, highlighting uncertainty in the market. Also, it looks like a fractal sell level is forming at $22.90 and the fractal will be validated if XMR-USD remains below $22.90 until May 1. Given that monero trades below $22.90 this week, sell positions are recommended.
Market sell orders are also justified, as we see that both the conversion line (blue) and base line (red) are flatlining, suggesting the direction of the market will continue to be sideways. But the flat conversion line also attracts the price action, so we should see XMR-USD drift toward $18.26.
To capitalize on a bullish breakout, limit sell orders are suggested just above $22.90. Only a move above $22.90 will invalidate the resistance at this level, that is the fractal sell level that could potentially form. The market in this case would most likely tend to fractal resistance at $25.10.
In anticipation of Ether Classic fund from Grayscale, the altcoin has posted fresh highs above $3.00 as we entered into April. However, since then, the price action has been muted, trading around $2.70. This week, we see that a fractal resistance has formed at the recent high at $3.2499. The most recent fractal support lies at $1.175, providing a favorable setup for bears.
Since the market is closer to a fresh fractal resistance, we should see price action move lower as the market attempts to carve out a new fractal support level. The flat conversion line provides an area where the market may find support, that is around $2.21, as well as the base line, at $1.75.
The Awesome Oscillator looks to be reaching a peak, suggesting that the height of bullish control is passing. The two doji candlesticks for the previous week’s price action indicates indecision and interpreting them after the temporary peak above $3.00 indicates that bearish momentum is starting to gain traction. Volumes are also falling week-on-week over the past month or two, suggesting is it very unlikely we will see any further upside for ETC-USD in the week ahead.
XEM broke to fresh highs and continues to invalidate fractal sell levels, as indicated by the horizontal yellow rays, suggesting bearish momentum is weakening. The market is looking to test the all-time high after galvanising a bullish Ichimoku breakout on the weekly timeframe shown below.
Also notice that on the week beginning April 3, the resistance provided by the peak of the lagging line was broken, a historic bullish signal as there is no further resistances indicated by the lagging line, leaving room for upside in XEM. The 0.00001634 resistance is now a key support level and we should see buying interest around this area. The next fractal resistance lies at 0.00002798 and the market is most likely to drift toward this level.
REP-BTC continues its bullish streak after the Ichimoku indicator established that the market had formed a bottom, confirmed early on in March. REP has now broken above 0.01 against bitcoin, a key psychological level. The weekly chart below shows the possibilities going forward.
The market established a fresh high just above 0.013 and now forms a fractal resistance. Support is provided by the conversion line at 0.0084, as this week’s price action has attempted to test it but buyers have brought the price higher. Therefore, bullish momentum is indicated by the conversion line, as the price is above this level and the conversion line is higher than the base line, which crossed over last week.
We use the FIbonacci analysis to determine the movement of the market. Ideally, we look for a break of the fractal at 0.01309710 and target the Fibonacci extension level at 0.0189. Alternatively, we could set limit buy orders above the FIbonacci retracement that is providing resistance at 0.0108 as well as at 0.01309710.
On the other hand, we only look to establish sell positions if we observe a close of the weekly candlestick below the conversion line, that is below 0.0084.
Factoids displayed strong gains against bitcoin for the week beginning April 10. FCT-BTC managed to show a bullish Ichimoku breakout on the weekly timeframe, opening up fractal resistances at 0.00682331 and 0.00869200. The breakout suggests we should buy on the close of last week’s candle, around 0.0052.
Notice the Ichimoku cloud has changed color from red to green, signaling the start of an uptrend. Also, the lagging line (purple) has moved from below to above the previous price action, providing another bullish signal. The only resistance provided by the lagging line is around 0.0059, which could be a key balance point as to whether the market will attempt fresh highs.
Alternatively, we could place buy orders inside the red Ichimoku cloud, just in case the market tests this support zone before testing the remaining fractal resistances at 0.00682331 and 0.00869200.
DOGE-BTC returned to short term equilibrium around 0.00000038 and tested support provided by the base line as well as the fractal level at 0.00000037. For the week beginning April 10, the market managed to close higher than this fractal level, providing an indication of further upside.
Also, the market looks to be moving back above the conversion (blue) and base (red) line, potentially providing a weak bullish signal this week. The lagging line (purple) has also moved above the previous price action for the second time and if DOGE-BTC remains above 0.00000033 this week, we will get stronger confirmation of this bullish signal from the lagging line. Finally, we see that the current week’s price action is making higher highs and higher lows compared to last week, suggesting the uptrend is still in play.
A new fractal resistance looks to form at the recent high 0.00000061, unless DOGE breaks even higher this week, which seems unlikely.