The top-performing cryptocurrencies are showing signs of profit booking at higher levels and this suggests the market is in a consolidation phase.
The crypto space is taking a breather after the recent sharp run. However, Binance CEO Changpeng Zhao (CZ) recently tweeted that he is positive that Bitcoin (BTC) will resume its rally to $16,000 “soon-ish.” This suggests that CZ believes the market has bottomed and is in the process of resuming the uptrend. Furthermore, the long-term price action of Bitcoin shows that it has outperformed the S&P 500 since 2003.
In other crypto-related news, French high school students will now be taught the basics of Bitcoin and its effects on the French and global economy. This suggests that the government is gradually accepting that cryptocurrencies are here to stay and the best way to approach them is to arm the next generation with the requisite knowledge.
Crypto market data weekly view. Source: Coin360
With the future looking bright, is this a good time to buy Bitcoin and other cryptocurrencies or can they fall further? Let’s analyze the charts of the top 5 performers of the past seven days.
TRX/USD
Tron (TRX) rallied about 13% in the past seven days. Tron CEO Justin Sun had built up expectations of a big announcement by hinting that a new partnership with a multi-billion dollar megacorporation would “broadly distribute TRON Dapps and tokens to billions of customers.” The altcoin rallied on the hype but succumbed to profit-booking on the news that Samsung had integrated Tron with its Blockchain Keystore. Can the altcoin build on this news after the initial profit booking? Let’s analyze its chart and find out.
The TRX/USD pair is facing resistance at $0.0234. Both the moving averages are flat and the RSI has gradually risen to the midpoint. This suggests a range-bound action for a few weeks. A breakout after consolidation will indicate accumulation by stronger hands. The first target on the upside is $0.041.
When in range, the best time to buy is at the support or wait for a breakout from it. Therefore, the traders can either buy on a rebound off the $0.0136655 to $0.011240 support zone or buy after a breakout of $0.0234. The stop loss can be kept at $0.011. Contrary to our assumption, if the bears sink the pair below the range, the downtrend will resume.
BCH/USD
Bitcoin Cash (BCH) has been among the top performers for the second successive week. Market participants cheered the news that Bitman’s co-founder had dismissed all the roles of fellow co-founder Micree Ketuan Zhan. However, can the altcoin extend its pullback going forward? Let’s analyze the chart.
The pullback in the past two weeks has carried the BCH/USD pair to the neckline of the head and shoulders pattern. This is a critical level to watch out for because if the bulls can push the price above it, a rally to $360 is possible. The pair will pick up momentum if the bulls can scale above $360.
The 20-week EMA is flattening out and the RSI has risen to the center. This suggests that the bulls are making a comeback. Our view will be invalidated if the price turns down from the neckline and breaks below the first support at $241.85. A break below $203.36 will resume the downtrend.
HT/USD
Huobi Token (HT) was the third-best performer in the past seven days with gains of about 10%. Can it build on its gains in the forthcoming weeks? Let’s study its chart.
The HT/USD pair has pulled back from close to the 50% retracement level of the recent rally. This is a positive sign as it shows that bulls are keen to enter on dips. It the buyers can push the price above $4.37, a rally to $5.3506 is likely. This level has acted as stiff resistance on two previous occasions, hence, the bears will attempt to reverse direction from close to this level. If successful, the pair might remain range-bound for a few weeks. It will turn negative below $2.9113.
On the other hand, if the bulls can propel the price above the overhead resistance zone of $5.3506 to $6.10, the pair will pick up momentum. Above this zone, the next level to watch on the upside is $9.
XLM/USD
Stellar (XLM) rallied about 9% in the past seven days to land up as the fourth-best performer among major cryptocurrencies. Has it bottomed out or is this a dead cat bounce that is likely to be sold into. Let’s analyze the chart.
The XLM/USD pair has extended its recovery and has risen above the downtrend line. This is a positive sign as it shows that the bears are losing their grip. The pullback will now face resistance at the 20-week EMA and above it at $0.088708.
If the price turns down from $0.088708, a few days of range-bound action is likely. The trend will turn negative on a break below the recent lows of $0.051014. Conversely, if the bulls succeed in pushing the price above $0.088708 and the 50-week simple moving average (SMA), a move to $0.145 is possible.
XMR/USD
Monero (XMR) wrapped up the list of best performers with a gain of about 8%. The cryptocurrency has been delisted on a few exchanges as the regulatory environment has tightened in the past few months. However, Dubai-based multi-currency and spot/futures exchange, BTSE, has provided the privacy coin a boost by launching its futures contracts. Can this move attract buyers? Let’s analyze the chart.
The XMR/USD pair has been trading in a wedge. The bulls are struggling to scale above the resistance line of the downtrend line. However, if the buyers push the price above this level, the pair will again hit a roadblock at the moving averages.
A breakout of the moving averages will be a positive sign as it is likely to result in a quick move to $120. There is a minor resistance at $97.9733 but we expect it to be crossed. Therefore, the traders can buy on a close (UTC time) above the moving averages with a stop loss of $52.
Our bullish view will be invalidated if the price turns down from current levels A break below the wedge will be a huge negative as it will lead to a retest of the yearly lows.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk, you should conduct your own research when making a decision.
The market data is provided by the HitBTC exchange.
