Weekly Cryptocurrency Price Analysis: Bitcoin, Ethereum, EOS, Litecoin, and IOTA
Today, we are likely to see higher highs as lead regulatory officials from Asia and America revealed what they think about restrictive cryptocurrency regulations. It’s likely that because of this, we are seeing recoveries in Bitcoin and Ethereum with the latter making impressive gains in the last 30 days. Other than Bitcoin and Ethereum, Litecoin and IOTA are also reversing from key support levels so we should keep an eye on them.
Let’s look at these charts:
Now, do you think Bitcoin will ever surge? Well, according to Tom Lee of Fundstat, Bitcoin may, after all, find backing from next week’s Annual Cryptocurrency Conference. He estimates that Bitcoin might end up spiking by more than 50 percent printing new highs in the process. Lee argues that this year’s conference is bigger and better than the last four events.
Subtly, this means blockchain and Bitcoin, in particular, is finding footing and drawing global interest. After all, Google Trend statistics shows that Bitcoin is more popular than stocks, Tesla or Elon Musk, founder of Tesla and Space X. As such, it isn’t surprising that this year’s event will draw more attention than previous conclaves.
While Lee was upbeat, SEC Commissioner Hester Peirce gave a bullish speech about cryptocurrencies, token and Initial Coin Offerings (ICOs) regulations. In his statement, he emphasizes the need for a realistic regulatory environment supportive of technological innovations.
"My fear that regulators will grab hold of the shovels and buckets is why I am often wary of so-called regulatory sandboxes."
— Peter Van Valkenburgh (@valkenburgh) May 8, 2018
Technically, not only are we seeing this rejection of lower prices at the middle BB in the daily chart but we have a weekly-4HR chart technical confluence in progress. Like the weekly chart, there is a stochastic buy signal from deep the oversold territory in the 4HR chart.
Accompanying this is that huge positive candlestick completing a three bar reversal pattern. Besides, there is a confirming bullish engulfing pattern despite bulls finding a minor resistance at the middle BB in the 4HR chart. In my view, buying at $9,500 with stops at $8,800 or May 9 lows can be a good trading strategy in line with our previous projections.
There is nothing that supersedes a product’s mass usage. Yes, Bitcoin might be superior to Ethereum in market capitalization but that’s about it. Do you know that you are likely to spend more when you transact through the Bitcoin network? In fact, data shows that Ethereum handles more than three times Bitcoin’s transactions on a daily basis but is still cheaper than Bitcoin legacy network fees. Typically, Ethereum handles up-to 800,000 daily transactions, can scale better and its smart contract feature gives it an edge.
Talking of technical advancement, Casper FFG (Friendly Finality Gadget), an Ethereum Foundation initiative, is now live at GitHub. Critics, as well as supporters, can review it and afterward applaud or down thumb the project. Most know that Casper FFG is just but a part of a long-term objective of shifting Ethereum from a proof of work (PoW) protocol to a proof of stake consensus where Validators would spearhead transaction confirmation.
— /r/Ethereum (@r_Ethereum) May 8, 2018
On the charts, prices are towing in with the main trend in the weekly chart. Remember, there is a clear stochastic buy signal in the trend defining weekly chart and the same set up is now visible in the 4HR chart. Even though gains are modest, Ethereum buyers seem to be ramping up.
In the last 24 hours, for example, Ethereum is up 1 percent and rejecting bear pressure trying to push it below $700. From our previous analysis, this level was the first layer of support and thus, this rejection means buyers can buy at current prices with stops at $700 or lower. Immediate targets would be at $900 and later $1,100 as per our previous forecast.
There is nothing much from Litecoin’s fundamental end only that the custodian of Litecoin, the Litecoin Foundation — an NGO — has a hot campaign calling for the coin’s retail adoption. The campaign specifically urges retailers to look for Litecoin accepting merchants and shop from their outlets. Concurrently, there is a drive aimed at merchants to accept Litecoin. If this goes global, we might see what we have been drumming for, Litecoin demand. Demand means gains and gains means profits for Litecoin holders.
Overly, we remain bullish and even though prices have been on a downtrend for the better part of this week, buyers are now jumping in and aligning themselves with the weekly trend. Evidently, there is a stochastic buy signal from deep the oversold territory but that is not enough, Litecoin bulls are finding support at $160.
Coincidentally, if you paste a Fibonacci retracement tool at last week’s high low, this reversal is happening at the 61.8 percent Fibonacci retracement level, a key reaction point. As such, I recommend longs with immediate targets at $180 with stops at $160.
Following weeks of important announcements and developments, EOS gains are pretty much modest this week. Besides yesterday’s announcement that UK buyers can now buy EOS from Cryptomate, there is nothing much that is market moving.
— Cryptomate (@Cryptomate) May 9, 2018
In fact, EOS is still stuck in a consolidation and is down 4 percent in the last 24 hours. Because of the mainnet launch, I remain net bullish and as such, buying on dips can be a good strategy. Currently, we have a bullish divergence pattern with $18.55 acting as our immediate resistance and bull trigger.
Any break above it means buyers should load with stops at $16.55 or this week’s lows.
While IOTA continues to oscillate below $2.5, long-term coin holders should be looking for loading entries in lower time frames. Remember, IOTA liaisons with top tech companies in Europe greatly boosts their general objectives of being an industry leader in IoT. Then again, just recently, Huobi announced that they shall be availing IOTA to their customers. This, by the way, constitutes demand and is a plus in the long run.
Price wise, IOTA is up 7 percent for the week but down 5 percent in the last 24 hours. In the 4HR chart, bulls and bears are sizing each other. But while they do that, a stochastic buy signal is missing. In my view, being neutral until when bulls pull their trigger at $2.55 can prove prudent. This is better than diving in now and buying without convincing long signals.