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Failed Breakout
BTC: Price: $10,270 | MCAP: $184.33 billion | 24-Hr Volume: $15.30 billion
Short-term trend: Neutral
Bitcoin (BTC) is trading tentative above $10,200 a day after failing to capitalize on a bullish breakout on a intraday chart.
BTC rose from the one-week low of $10,060 to $10,542 in the European trading hours yesterday, confirming a falling wedge breakout on the hourly chart. The breakout implied an end of the pullback from recent highs and a resumption of the rally from the Aug. 29 low of $9,320.
The bullish setup, however, failed to draw bids and prices fell back to $10,250 at 16:40 UTC, as seen in the chart below.
Some observers consider failed breakouts as a warning of impending sell-off. So far, however, the downside has been restricted below $10,200.
Also, the outlook will remain neutral as long as prices are holding above $10,060 – the low of the doji candle that applied the brakes on the sell-off yesterday and fueled a price bounce to levels above $10,500.
If prices break below $10,060, the bearish setup seen on the daily chart below would gain credence, possibly leading to a deeper drop to $9,750.
On the higher side, a UTC close above the bearish lower high of $10,956 (Aug. 20 high) is needed to confirm a bullish revival.
Long-term trend: Neutral
Bitcoin's monthly chart shows a double inside bar pattern – August’s candle falls within July's high and low and July’s candle is engulfed by June's high and low.
Double inside bars indicate indecision and lack of volatility and are considered a sign of bullish exhaustion, if they occur after a notable price rally, which seems to be the case here.
Also, the selling volume witnessed in July was the highest since March 2018. So, the long-run outlook stands neutralized.
A break above the high of the first inside bar ($13,200) is needed to revive the bullish outlook and a move below the low of the first inside bar ($9,049) will confirm a bearish reversal.
Traders can also take a weekly (Sunday, UTC) close or consecutive high-volume daily closes above $12,000 as a sign of bullish continuation. After all, a weekly close above $12,000 has remained elusive the last week of June.
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Verge Looks North
XVG/BTC: Price: 4600 BTC | MCAP: 7,147 BTC | 24-Hr Volume: 208.96 BTC
Short-term trend: Bullish
XVG jumped 9 percent on Monday with highest growing volume since Aug. 25, validating the bullish doji reversal pattern confirmed on Aug. 7.
The 5- and 10-day moving averages (MAs) are about to confirm a bullish crossover and the moving average convergence divergence histogram has crossed above zero, signaling a bullish reversal.
So, the stage looks set for a test of supply around the 50-day moving average (MA), currently located at 49 sats. Acceptance above that level would expose the next major hurdle lined up at 56 sats (Aug. 25 high).
The bullish case would be invalidated if prices drop below 41 sats, although, as of now, that looks unlikely.
Long-term trend: Neutral
XVG's weekly relative strength index (RSI) continues to move in a sideways manner below 30 (in oversold territory) for the sixth straight week, indicating seller exhaustion.
Therefore, the bearish outlook stands neutralized. That said, an acceptance above 63 sats is needed to invalidate lower highs pattern and confirm a bearish-to-bullish trend change.
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Indecisive Stellar Market
XLM/USD: Price: $0.06079 | MCAP: $1.15 billion | 24-Hr Volume: $134 million
Short-term trend: Neutral
XLM/USD is currently reporting a 2 percent drop on a 24-hour basis. The cryptocurrency, ranked 12th as per market value on CoinMarketCap, is currently changing hands at $0.06079 on Bitfinex.
As seen in the daily chart below, the 5- and 10-day moving averages (MAs) are flatlined (neutral). Also, selling volumes have dropped over 12 days.
So, the immediate outlook is neutral. That said, a UTC close above $0.06411 (Sept. 3 high) is needed to confirm a bearish-to-bullish trend change. Sellers may feel emboldened if prices break below $0.057688 (Sept. 6 low), however, that looks unlikely with signs of seller exhaustion on the weekly chart. Long-term trend: Bullish above previous week's high
Stellar charted a "spinning bottom" candle last week, which comprises of long wicks and small body. That candle is widely considered a sign of indecision in the market place.
In XLM's case, however, the spinning bottom has appeared at record lows and indicates seller exhaustion and an impending bullish reversal.
The trend change would be confirmed if the cryptocurrency ends the current week (Sunday, UTC) above the spinning bottom's high of $0.064288. That would open the doors for a stronger bounce to $0.090.
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Ethereum's ether (ETH) cryptocurrency is flashing green above $180 at press time and needs to move above $185 to confirm bullish reversal, according to @TheCryptoDog.
The second-largest cryptocurrency by market value rose more than 5 percent on Sept. 7, confirming a falling wedge breakout.
A falling wedge comprises of converging trendlines connecting lower highs and lower lows. The converging nature of the trendlines indicates seller exhaustion. Hence, a wedge breakout is considered a sign of bullish reversal.
In ether's case, it indicates the sell-off from the June 26 high of $363 has ended and the bulls have regained control. That said, the cryptocurrency has persistently struggled to find acceptance above $185 in the last 72 hours.
Hence, a break above $185 is needed to cement the wedge breakout or bullish reversal. It is worth noting that a convincing UTC close above $185 would also invalidate the bearish lower highs setup on the daily chart.
A bullish close, if confirmed, could be followed by a bounce to $204 (Aug. 19 high). |
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| Disclaimer: The information presented in this message is intended as a news item that provides a brief summary of various events and developments that affect, or that might in the future affect, the value of one or more of the cryptocurrencies described above. The information contained in this message, and any information liked through the items contained herein, is not intended to provide sufficient information to form the basis for an investment decision. The information presented herein is accurate only as of its date, and it was not prepared by a research analyst or other investment professional. You should seek additional information regarding the merits and risks of investing in any cryptocurrency before deciding to purchase or sell any such instruments. |
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