Monthly Cryptocurrency Price Analysis – May 2018
The cryptocurrency market by capitalization has gone through a loss of about 22% in the last month. Market capital decreased from $423 billion to the low of $331 billion approximately in the month of May.
Bitcoin being the market leader fell around 18.5% devaluating from the cap of 157.4 billion to 128 billion and was the 2nd among the strongest in terms of least devaluation of market cap, keeping itself behind Ethereum.
Overall, Bitcoin market dominance increased by 1.4% from 37.2% to 38.6% over the month of May and was also the major driving force behind the crypto-volatility trend as there was high correlation in alternative coin prices with the price fluctuation in Bitcoin.
Amidst all of the above, we have seen higher forms of blockchain and cryptocurrency advancements and developments recently. One of the major news coming in was Coinbase acquiring the financial services firm and so, becoming a regulated broker by the US Security and Exchange Commision (SEC). Another one being the top-cryptocurrency exchange Binance entering the fiat to crypto market by setting up a bank account in the “blockchain island” Malta.
Bitcoin is representing a gain of about 1.2% in last 24-hours trading close to around $7,615. Bitcoin seen in the weekly chart above has formed a symmetrical triangle to which a breakout or break-down on either side is nearly expected. Let’s look into the daily chart.
The above chart still shows the very resemblance in what we observed in the previous report. Even if we still closely look into the chart above, the price parameters haven’t changed much in last 48-hours and Bitcoin is constantly resisting against the resilient level of $7,750 (50-week SMA) which also presently collides with 20-day EMA.
The acceptance of Bitcoin trading below the 50-week SMA is something to worry about as this has happened first time since Oct 2015. However, the symmetrical triangle formed in the weekly chart the gives an essence of a breakout. The next levels where BTC might again face selling pressure are $9,100 and $10,000. The consolidation post the rise over the short-range descending line forms the likeliness of a positive momentum. You can read in detail for the explanation of the same in my last analysis.
Conclusion: Looking into mid/long-term perspective, Bitcoin holds strength against a very important long-term support range of $6,900 – $6,425 against which we expect BTC to gain a momentum to upper levels of resistance as mentioned. Our bullish view will be invalidated if BTC falls below $6,400.
Ethereum, among all major cryptocurrencies by market capitalizations holds stability over the level of $600 from quite sometime now. Presently it is representing a fall of about 1% in last 24-hours.
Ethereum has broken the descending channel and is consolidating just above the particular short-range line of resistance.
Looking into the chart above, Ether forms a pattern where either of the trade set-ups can be applied as observed here. Ether has been forming multiple trading channels and currently, it is consolidating above the third which might be a possible 4th trading channel which gets Ether a possible positive momentum.
The above chart gives an indication that Ether will either gain momentum above the neckline resistance of the Head & Shoulder pattern which lies between the range of $635-$650. Any breach of the respective level will get ETH to complete the pattern depicted in the chart above. The upper levels that can be reached is $750 & $870 with a mid-term objective. The other possibility is ETH follows the pattern and takes support along the support line of $545 and $490 where Traders will look to buy on dips.
Conclusion: Both the above possibility indicated strength in Ether on lower levels of support and currently there is no technical indication for a fall. Traders should ideally wait for either of the possibility for a positive momentum. Our view will be invalidated if ETH in mid-term falls below $490.
BCH is representing a fall of 2.63% in last 24-hours and is presently trading close to $1,110.
BCH post forming three patterns that gave strong signs of bullish behavior has been trading just below its 50/100 day EMA having subtle resistance around $1,225.
As seen in the chart above, BCH formed an inverse head and shoulder pattern (also Bullish Engulf) post which it gave a rally of well over 15% once, the neckline was crossed. The same neckline forms immediate intraday support at $1,050.
BCH has been quite some time and is waiting for the flag-bearer currency to initiate some support to continue its upward momentum. The strength in BCH is seen through two positive formations :
1. Head & Shoulder Neckline Support
2. Higher Highs and Higher Lows Support
BCH has major support range that falls in the bracket of $1,050 – $980 which should not be broken. If a fall below the support range is initiated again which can get BCH in its weakest zones.
Conclusion: Traders would ideally go for a strategy to go bulls on dips in the support range given above. A momentum crossover above $1,225 will get BCH to test $1,350, $1,550 and $1,780.
Our view will be invalidated if BCH falls below the crucial support level of $975.
Weekly Price Pointers :
Traders can smartly use their skills and can refer to the technical levels above to make optimized trade decisions. Happy Trading!
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This report is not intended to be relied upon as advice to investors or potential investors and does not take into account the investment objectives, financial situation or needs of any investor. All investors should consider such factors in consultation with a professional advisor of their choice when deciding if an investment is appropriate.
The Company has prepared this report based on information available to it, including information derived from public sources that have not been independently verified. No representation or warranty, express or implied, is provided in relation to the fairness, accuracy, correctness, completeness or reliability of the information, opinions or conclusions expressed herein. This report is preliminary and subject to change; the Company undertakes no obligation to update or revise the reports to reflect events or circumstances that arise after the date made or to reflect the occurrence of unanticipated events.
Trading & Investments in cryptocurrencies viz. Bitcoin, Bitcoin Cash, Ethereum etc.are very speculative and are subject to market risks. The analysis by Author is for informational purpose only and should not be treated as an investment advice. This report is for educational purpose only.