Bitcoin, Ethereum, Bitcoin Cash, Ripple, Litecoin: Price Analysis, October 04
Latest trading review on most popular cryptocurrencies.
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* BTC/USD, ETH/USD and LTC/USD market data is provided by the HitBTC exchange.
Goldman Sachs CEO Lloyd Blankfein indirectly hinted that cryptocurrencies are on their way to replacing paper money. This is in stark contrast to JPMorgan CEO Jamie Dimon, who has still not acknowledged the rise and acceptance of cryptocurrencies across the globe. Nevertheless, it is interesting to note that at least a few major investment banks are pondering over allowing investors direct trading opportunities in cryptocurrencies.
Experts are bullish on Bitcoin, expecting it to reach $6,000 by the end of this year. That is a good 42 percent above the current price of $4,200. Let’s see, whether this is a good time to enter cryptocurrencies or are they due to fall further.
We had recommended taking 30 percent profits on our Bitcoin positions at $4,418. That made our existing investment in Bitcoin risk-free. So, should traders re-enter at the current levels or will Bitcoin fall further?
There is a confluence of support between $4,114 to $4,170, from the 20-day exponential moving average, the 50-day simple moving average, the horizontal line, and the trendline. Therefore, we expect this support to hold, at least in the short-term.
The subsequent rise from here will decide whether Bitcoin will resume its uptrend and rally above $4,500 or will it turn down and sink below $4,000.
Aggressive traders, who trade for the short-term, can buy at the current levels of around $4,218 and keep a stop loss of $4,000. The target objective is $4488. However, this is a risky trade, therefore, please keep the allocation size 25 percent of normal.
For swing traders, please maintain the stop loss at $4,000 and don’t add any fresh positions. If Bitcoin breaks down and closes well below the trendline, it is likely to fall to $3,900 and $3,731 levels, which are 38.2 percent and 50 percent Fibonacci retracement levels of the pullback from $2,974 to $4,488.01.
Ethereum could not breakout of the bullish ascending triangle pattern and price has moved out of the trendline, invalidating the setup.
The cryptocurrency is consolidating between the $278.88 and $316.61 levels for the past few days. Both the moving averages have also flattened out, signaling a range bound action. Ethereum doesn’t have a history of forming large ranges. Therefore, we expect a breakout or breakdown of this range soon.
We recommend waiting for a breakout above $317 to enter long positions. Though there is a resistance at $344, we expect the digital currency to breakout of it and rally to $354. The stop loss for this trade should be kept at $278.
However, if Ethereum breaks down of $280, it is likely to extend its fall to $257.94, which is the 50 percent Fibonacci retracement level of the pullback from $200.15 to $315.72.
We have been cautious on Bitcoin Cash for the past few days and the price action has validated our stance. Should you buy this fall?
In our previous analysis, we did not recommend any trade on bitcoin cash because we were not confident that the range will hold. Today, the digital currency has broken down of the range, which gives it a lower target of $221, unless Bitcoin Cash quickly reverses direction and ends the day above $385.
Though we expect some buying to emerge at $300 levels, we are not recommending any trades on Bitcoin Cash. We shall wait for a bottom formation before buying it.
We have carried a long position in Ripple from the past week. Ripple is sustaining above both the moving averages and the trendline support, which is a positive sign.
The digital currency will gain momentum once it breaks out of $0.22000 levels. Our target level remains at $0.25000. Traders should maintain the stop loss at $0.185000.
The cryptocurrency will become negative if it breaks down and closes below the uptrend line. Until then, we remain bullish on Ripple.
We have been waiting for a breakout of the range in Litecoin, which has not happened. So, should you buy at the lower end of the range?
Litecoin is trading within a well-defined range of $44.160 on the lower end and $57.729 on the upper end. As the cryptocurrency was unable to breakout of the range, it is likely to fall to the lower end of the range, if it breaks down of $50.
We expect the range to hold; therefore, we recommend a long position in Litecoin around $46 levels when price turns up after touching the lower end of the range at $44. Please don’t buy when the digital currency is falling. We can keep a stop loss of $40 and our target objective will be a rally to $57.
On the other hand, if Litecoin holds the $50 levels and rallies above $58 levels, we expect it to start a new uptrend. Therefore, we recommend long positions at $58 with a stop loss of $49. Our target objective is $71.