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 broke its all-time high last week and breached the $1400 level. At the time of writing, BTC-USD trades around $1468 on the Bitstamp exchange. As bitcoin moved above the previous high at $1350, altcoins experienced a sharp drop, with a recovery eventually following on May 2 and 3.
The daily price action for BTC-USD is displayed below and shows that the next resistance lies at $1543.76. Further resistance is found at the 423.6 percent Fibonacci extension level at $1612.55.
The weekly chart below shows that after flatlining for a few weeks, the conversion line (blue) is on the move again, pushing higher, suggesting a high likelihood that the market will continue its upward momentum. The upward gradient is also displayed by the Ichimoku cloud and base line (red). Last week’s candlestick also indicates buyers were in control for the entire week, with little to no wicks on either side of the candle.
Furthermore, the Awesome Oscillator continues higher and remains green in color, giving further confirmation that bullish momentum is strengthening this week.
Ethereum’s cryptocurrency saw an significant increase in volume on the Kraken exchange last week, pointing to further gains for ETH-USD. The FIbonacci extension target at $84.61 has still not been achieved, with ether struggling to break $80.
However, last week, bulls were out in full force, with the bullish Marubozu candlestick signaling that buyers were in control for the entire week. The 50 percent and base levels of this candlestick are indicated on the chart and will provide good entry points into the long-term uptrend. Therefore, we set limit buy orders at $48.68 and $63.52.
A break of the Fibonacci extension level at $84.61 will open up the 261.8 percent extension level at $132.58.
Litecoin breaks to fresh highs and moves above the $20 psychological handle on May 3, confirming a move toward $25.88 and possibly $39.68 over the long term, two important Fibonacci extension targets. The altcoins has been buoyed by an upcoming implementation of SegWit, an addition to Coinbase on May 3 as well as the possibility of the Lightning Network on top of Litecoin.
Dash managed close above a key resistance last week at $93.49, opening up further gains for the altcoin. However, trading volume is very low and the Market Facilitation Index indicates a ‘fake’ this week, suggesting some manipulation of prices. Therefore, it is recommended not to take any new positions this week or if you have positions in DASH-USD do not exit this week, as large players in the pit are indicated to be in control of the market as volume dries up.
Nevertheless, the bullish indication given last week with a break of the key resistance could prompt long-term buy positions, with an initial target of the all-time high at $117.80. Bullish momentum is also indicated by the conversion line (blue) which is trending higher and the Awesome Oscillator, which is forming a bullish saucer this week.
However, we could set limit buy orders just below the support at $93.49 to take advantage of a downturn, with an initial target at $75.13.
In our previous cryptocurrency report, we highlighted a target of $6.60 for ETC-USD on the Poloniex exchange, which was achieved the very same week. This week, the market has tested this Fibonacci extension level but has so far held up, suggesting we may see further gains for the altcoin. For instance, the next resistance is provided by the 361.8 percent extension level at $8.68.
A break below $6.60 would see the market attempt to test support which lies at $4.53. NOtice that so far this week, buyers have tried to push higher but sellers have remained fairly successful in weighing the market down, displayed by the long upper wick of this week’s candlestick.
Monero has been performing well over the past few weeks, maintaining stability above $20. The XMR-USD pair on the Kraken exchange is displayed below. We see that the market is getting ready to test the fractal resistance at $25.99525. A slight uptick in the conversion line (blue) this week suggesting that bullish momentum is picking up on one of the largest cryptocurrency exchanges.
Also, last week saw a big increase in volume compared to previous weeks, suggesting that further gains lie ahead for the altcoin. We also see that last week’s price action broke the resistance provided by the lagging line (purple) at $21.89.
The weekly chart above also shows that the Market Facilitation Index is brown, which is known as a ‘fade.’ It is during ‘fades’ that we can make profitable trades as it indicates that the market is bored and building up for a new move. We think the move is biased to the upside given the signal outlined above. Also, we see that the market is currently in between two of the highest Fibonacci retracement levels, suggesting a breakout to the upside. Therefore, we look to buy at market and set limit buy orders around $26.00 to capitalize on a move toward the Fibonacci extension level at $34.88.
On the other hand, a move below $22.60 will necessitate a bearish outlook for XMR-USD.
XEM-BTC soared to fresh highs last week, and narrowly missed our target at 0.00004512, peaking at 0.00004490. Nevertheless, the bullish momentum over the long term remains intact. We should see the market take another attempt at the Fibonacci extension level and allows us to take partial profit on long positions.
The monthly price action is shown below. For the entirety of april, buyers were in control, with some gains lost toward the end of the month as some people likely sold to book profits. After moving to lows near 0.00003100, XEM-BTC has continued its upward move. A sustained break above 0.00004512 will open up the second Fibonacci extension level at 0.00007286.
The weekly price action for XEM-BTC is displayed below, where a fractal sell level may form at 0.00004490, unless the market breaches this level by May 15. Therefore, we could set limit buy orders around 0.0004490 with a target of 0.00007286. On the other hand, if a sell fractal is confirmed on May 15, then we would look to exit long positions and/or sell XEM-BTC.
Namecoin is displaying some interesting price action this week, as a bullish Ichimoku cloud breakout looks to be imminent, seemingly following the price action of Peercoin (see below). The weekly price action is shown below. First, let us examine the Ichimoku indicator. The Ichimoku cloud has turned green, suggesting we should be wary of an uptrend formation.
However, we have yet to obtain a Ichimoku cloud breakout, with the price action remaining in equilibrium. The lagging line is moving higher and is bullish at the moment, as it is above the previous price action. The conversion line looks to cross above the base line, which will confirm bullish momentum. Therefore, we look to buy on the weekly close if NMC-BTC is above the Ichimoku cloud.
Also, when examining the Awesome Oscillator, we notice a bullish saucer. Therefore, we look to place limit buy orders just above the high of the candlestick corresponding with the last green bar of the three-bar saucer pattern. We set limit buy orders around 0.00099796, as a break above this level will see bullish momentum dominate.
Possible targets include the fractal resistance at 0.00182890 as well as the psychological 0.002000-0.0025000 region. A weekly close above the most recent fractal resistance at 0.00119999 will give further bullish confirmation and awaiting this signal may make for a safer long-term buy position for NMC-BTC.
The monthly timeframe gave a bullish signal on May 1, as NMC-BTC closed above the conversion line. This indicates bullish momentum and suggests that the market will tend toward the base line, which is another indication of equilibrium. The conversion line has already been tested for the month of May, at 0.0007, but the market has since moved higher. Therefore, there is a higher likelihood that the months ahead will see further gains for NCM-BTC, with a potetnial long-term target at the base line (red), which provides resistance at 0.0025.
The weekly chart below shows that Peercoin managed to establish the first-ever Ichimoku breakout, closing above the Ichimoku cloud. This provides a strong bullish signal, as the cloud projected ahead has also changed color from red to green for the first time. Volumes traded have increased substantially since March, indicating that more and more traders are becoming interested in this crypto-pair.
For the week beginning May 1, we have seen the market establish slightly higher highs, which also gives confirmation of an upward current.
There are also other bullish indications from the weekly chart above. Notice that the lagging line (purple) is beginning to trend higher and has moved above the previous price action. Also, after converging, the conversion line (blue) now looks to move above the base line (red) giving an indication of bullish momentum starting to take hold.
The targets for long positions are also shown by the horizontal yellow rays. Two peaks from the lagging line indicate resistance around 0.00125 and 0.00170. Also, the flat upper span of the red Ichimoku cloud also signals a key resistance around 0.00240.
We also examine the monthly timeframe below, as the close of April’s candlestick may give us some indication of the direction of PPC-BTC over the long term.
April’s price action saw PPC-BTC continue higher after a close above the conversion line for March. Therefore, with buyers exerting control over March and April and with the price action above the conversion line, we expect PPC-BTC to continue the upward trend toward the most recent fractal resistance at 0.00140. Further resistance is provided by the base line at 0.00210. The conversion line should provide support around 0.0006 and limit buy orders are suggested at this level.