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Market data is provided by the HitBTC exchange.
Since 2013, Bitcoin has seen a sharp rally in the last quarter of every year, barring 2014. In 2013, the rise was 486.74 percent, in 2014, the leading cryptocurrency declined marginally by 16.69 percent. In 2015, the gain was 81.24 percent, while in 2016 the rally returned 58.17 percent. In 2017, the up move rewarded investors with a gain of 215.28 percent.
To quote Mark Twain, “History doesn’t repeat itself, but it often rhymes.” As traders, we respect the seasonal trends, therefore, we will be on the lookout for buying opportunities in the last quarter of this year. Of course, we won’t take a trade until we see a reliable buy setup.
The fundamentals of the sector continue to improve with large brokerages, banks, and nations coming forward to encourage blockchain technology and cryptocurrencies. Barring any adverse news, the trajectory should be higher in the next three months. So, which digital currencies are signaling a change in trend? Let’s find out.
We assume that traders who follow us will have initiated long positions in the range of $6,600–$6,750, as suggested in the previous analysis. The pullback in Bitcoin stalled at $6,831.99 on September 18.
Currently, the BTC/USD pair has corrected back to the support level of $6583.46. Both moving averages are located at this level, so this becomes a critical support to watch.
If the bulls defend this level and a bounce materializes, a move to the downtrend line of the descending triangle is possible. The virtual currency will pick up momentum if the price sustains above the downtrend line.
On the other hand, if current support breaks, a retest of the $5,900–$6,075.04 support is likely. Traders should keep the stop loss at $5,900 because if support breaks, a deeper fall to $5,450 and further to $5,000 is probable.
Ethereum broke out of the descending channel on September 21 but is finding it difficult to sustain the breakout.
The ETH/USD pair is currently back at the downtrend line of the channel, which should act as strong support. The 20-day EMA has flattened out and is also located at this level. Hence, this becomes a critical support level to watch.
If support breaks, the digital currency cоuld slide to the $192.50 level once again. However, if support holds, a rally to the $302 is possible. We currently don’t see a reliable buy setup, so we are not suggesting any long positions.
We suggested traders not to chase the rally higher in our previous analysis. Our recommendation was validated as Ripple started a correction after reaching the intraday high on September 21.
As the XRP/USD pair has broken out of the downtrend line and both moving averages have completed a bullish crossover, we believe that the trend has changed. Traders should now look for buying opportunities on dips. What are the key levels to watch out for?
The 50 percent Fibonacci retracement of the recent rally is at $0.51676, which has been acting as a strong support. If this level breaks, the correction can deepen to the 61.8 percent retracement level of $0.45832. If the new trend gains traction, the pullback should end at either of these two levels.
We will watch for the next couple of days and then take a call on a long position. Our bullish view will be invalidated if bears force the price below the downtrend line.
Bitcoin Cash failed to reach the 50-day SMA. It turned down from just above the $500 level on September 22. The trend remains down as it is still trading inside the descending channel.
The 20-day EMA is flat and the RSI is close to the midpoint. This points to a likely consolidation in the near-term.
If the BCH/USD pair falls below $450, it can retest the low at $400. On the upside, the critical levels to watch out are the 50-day SMA and the downtrend line of the descending channel.
We will wait for the trend to change before suggesting a trade.
Bulls could not build on the breakout of the overhead resistance of $5.65. EOS did not rally as we had anticipated, and turned down from $6.3117 on September 22.
EOS is currently retesting the breakout level of $5.65. Support from the moving averages is just below the current level. If support holds, the EOS/USD pair will again try to rally to $6.8299.
If the current support breaks, a decline to the next support at $4.50 is probable. The digital currency has formed a continuation head and shoulders pattern, which will complete on a break below $4.4930. Therefore, we suggest traders keep their stops on the long position at $4.40.
Stellar touched a high of $0.30434761 on September 23, just below its target objective of $0.3157505. Though the bulls broke out of the downtrend line of the descending triangle, they could…