Cryptocurrency market update: The quiet before the storm?
At the time of writing, most major cryptocurrencies are trading sideways and nothing has really changed – rather than volumes decreasing in general, which is rarely a good sign for the days ahead.
From the current top 10, only Litecoin and Binance Coin seem to be maintaining consistent gains. I’m pretty sure Binance Coin’s price gauge is linked to the current strategy of Binance surrounding adding new tokens to its Launchpad, creating hype around the project, then running ICOs where investors get priority/discounts using the BNB token.
Will BNB continue to grow indefinitely? Will investors soon switch back to Bitcoin after cashing out some profits, or will they continue to hold tokens bought during ICOs?
What about the rest of the market? What are the short and long-term perspectives for the rest of the top cryptocurrencies?
Bitcoin
After briefly topping $4,000 last week, Bitcoin’s price has entered a stable trading pattern ahead of a key resistance level that, if breached, could pave the way for a sustained run to new yearly highs. Despite the lack of momentum observed lately, the largest cryptocurrency is quietly pacing toward its second consecutive monthly advance – a feat last achieved during the 2017 bull market.
Looking at the above graph, courtesy of TradingView, we see Bitcoin clearly wants to break that $4,000 resistance level. Bitcoin is also trading between the 20 and 50-day EMA, meaning while price could either breakout above $4,000 or retrace back to the $3,800 region, we shouldn’t expect any major moves.
Last week, BTC touched and stayed above this key level, although during the weekend, it slowly dropped back to the $3,900 range.
Another important data point is the lack of volume we’re currently experiencing. After some recent news and findings showing there’s enormous amounts of fake volume on some widely used Asian exchanges, we could experience a slow and gradual decline in volume. In my mind, this surely won’t help prices.
Still, we should remember markets can stay irrational for as long as needed, so fake volume could still help pump prices in the short term.
Ethereum
I would argue that Ethereum is on the verge of a major breakout. At least, that’s what the above graph seems to show.
First, the space between the moving averages is clearly narrowing – something that usually happens when price is about to make a major move either upwards or downwards. Still, much like Bitcoin, Ethereum’s price hasn’t been able to successfully break past the 50-day EMA.
Although since the beginning of the month ETH has touched $140 a couple times, it hasn’t been able to stay above this key resistance level.
Volumes are thinning as well, which is not a good sign in the short term. From a short-term perspective, we could see a move down to between $120 and $130 soon.
Ripple
Although I would love to be the bearer of some better news, XRP doesn’t look too good either.
At the time of writing, Ripple’s price has fallen below the 20-day EMA, which is a really bad sign if you ask me. XRP could soon be testing yearly lows, similar to what happened during late January and February. Maybe it’s Ripple’s new monthly trend?
Jokes aside, it could mean some investors are realising small gains and then converting back into Bitcoin or a stablecoin.
Regarding Ripple, if its price does not touch the $0.30 level again, I would be surprised.
Litecoin
If you’re looking for a counter-trend chart, this is definitely the one.
Although from a volume perspective Litecoin is also losing some strength, LTC is currently on a really nice positive trend that shows little sign of slowing down.
LTC has been trading sideways for the past week, showing signs of consolidating around $60, where it has been trading for the past 10 days. What is keeping my hopes up is the fact LTC’s 20-day EMA is currently gaining momentum and is quite close to crossing the 200-day EMA.
That is the first clear sign of a stable bull run.
Binance Coin
From the top 10 cryptocurrencies, Binance Coin has been the clear winner.
CZ’s strategy is clearly working, and a great deal of demand has been felt for the BNB token, as we can see by looking at the sheer amount of volume.
BNB investors must be quite happy!
Everything on the chart looks quite positive, as the 20-day EMA is currently above both the 50 and 200-day EMA, and the 50-day EMA is already above the 200-day EMA.
BNB is currently trading close to $17, and as long as demand for the token continues, I expect the price of Binance Coin to keep rising, or at worst, to consolidate and create a new support level near $15.
Safe trades!
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