Bitcoin, Ethereum, Ripple, Bitcoin Cash, EOS, Litecoin, Cardano, Stellar, IOTA: Price Analysis, June 01
Latest technical analysis on top 9 cryptocurrencies from an expert trader.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. 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.
The market capitalization of the crypto world has increased by about $25 billion since May 29. The Italian political crisis and the probable escalation of a trade war have attracted investors back into cryptocurrencies.
Dan Morehead, founder of Pantera Capital Management believes that Bitcoin has made a bottom for the year. He proposes to buy now when the prices are still low, to benefit from the ensuing rally in the next few months. We have been voicing a similar opinion for the past few days but we believe that the purchases should be staggered to take advantage of the volatility.
Bitcoin continues to be the undeniable leader. It sets the direction that is followed by most altcoins. Brad Garlinghouse, CEO of Ripple believes that once the crypto markets mature, they will start differentiating between the digital currencies and the correlation with Bitcoin will reduce. He, however, warned that 99 percent of the virtual currencies in circulation will vanish in about a decade. Only the ones that solve a real problem will remain.
There have been a few complains that we don’t mention the fundamentals in our analysis. In technical analysis, we believe that the charts discount all the fundamental news. Hence, we only read the patterns on the chart and try to forecast the probable direction. In the past few months, these patterns have kept us on the right side of the trade and have helped us avoid large losses. We try to avoid trading during major events, due to the uncertainty.
Let’s see, what direction are the charts pointing to today.
We believe that Bitcoin is trading in a large range of $6,075.04 to $12,172.43. The strategy to trade such a large range is to buy near the bottom and sell close to the top. So, we have been waiting to buy on a sharp dip below $7,000, as close to the bottom of the range as possible, so that our risk is less. If the $6,075.04 level breaks, the digital currency can fall to $5,450 levels.
The BTC/USD pair is presently facing resistance at the downtrend line. Even if this level is crossed, it will again face resistance close to the 20-day EMA. Once this level is crossed, a move to the 50-day SMA is possible.
We retain our preference to buy on a sharp dip but only after the fall is arrested. Therefore, we suggest waiting for a couple of days to get better clarity.
Ethereum has been gradually rising, moving towards the 20-day EMA where it will face a stiff resistance. Just above the 20-day EMA is the resistance line of the descending channel and the 50-day SMA, which will also act as a major hurdle.
On the downside, the intraday low of May 28 at $492.5 will act as a strong support. If this level holds, we shall consider long positions but if the level breaks, a f