This price analysis was absolutely mandated after the extreme price action for in recent days.
Thus, this price analysis will be taking a look at what’s happened to over the past few days/weeks, and develop a forecast for future price action via technical and chart analysis.
The first thing that we must acknowledge is that is up over 40% over the last two weeks, which is an astronomical gain for .
When ‘scrolling out’ from the chart, we can see that is getting close to its previous localized high, which occurred in early January in anticipation of the Constantinople hard fork (which was cancelled last minute).
In order to gain more insight on , we’re going to move to the .
In the picture above, we can see that broke a major, long-term downtrend resistance that had been established on May 5th, 2018.
From the picture above, we can also see that this downtrend resistance was very well-tested and that it occurred at a very sharp angle, making it a formidable resistance for the price action.
Volume Confirmation
One of the telltale signs that a major downtrend resistance has truly been broken is a major spike in to accompany the breakout.
We can positively identify that there was a spike that correlated with the ‘breakout’ candle.
This is notable because this helps separate the difference between a ‘real’ and ‘fake’ breakout.
Important Note
Whenever analyzing that span over several months with such a variable stretch of data, one must switch to the ‘logarithmic’ chart setting in order to properly account for the distortion of data.
Support and Resistance Points
From here, let’s see if we can establish some notable points for .
The first, and most obvious overhead resistance (from looking strictly at the chart), can be identified at $156 on the . This marks the previous localized high for .
In the chart above, we can see viable support at the $123 mark on the based on a simple chart analysis.
Exponential Moving Average
There is always a lot of information that can be gleaned about price action from the EMAs (Exponential Moving Averages). Again, due to the volatile nature of crypto (we just saw jump 40%+ in two weeks), EMAs are the author’s preferred MA because they place ‘weight’ on more recent data points in a way that simple moving averages do not.
So, let’s take a look at the chart on the .
In the chart above, we can see that the EMA-12 (red line) has crossed over the EMA-26 (green line) on the , which is a good sign of positive and strengthening price action.
The price is also above both EMAs, making these EMAs supports. The EMA-12 and EMA-26 for are at the values $126 and $121, respectively. Which corroborates our earlier assessment of the $120-$125 price range serving as a support for .
In the chart above, we added the EMA-50 (golden line). The EMA-50, in particular, tends to have the strongest on price action for cryptocurrency on the . So, this is one that is worth paying close attention to.
As we can see in the chart above, like the previous two EMAs that we looked at, the price has crossed above the EMA-50, which is a huge sign of price strength for .
We can also see that the price successfully tested the EMA-50 for a few days before continuing upward, breaking past the long-term downtrend resistance.
The EMA-12 has crossed above the EMA-50 as well and it appears that the EMA-26 is curving upward to overtake the EMA-50 as well.
It is always when EMAs with shorter look back periods are at a higher value than EMAs with a longer lookback period.
In the chart above, we have added the EMA-100 (blue line) and the EMA-200 (dark red line).
Surprisingly, the price action for has exceeded the EMA-100, which is a huge deal. The EMA-100 currently sits at the value of $139 on the at the time of writing.
The EMA-200 is far off into the ‘distance’ at a value of $202. If and when the price reaches that point, this should be considered a noted overhead resistance.
Ichimoku Cloud for Analysis
Similar to , the price action for has completely broken north of the .
The top of the should be considered resistance and it is currently holding a value between $125-$130 on the .
Relative Strength Index
The (7) for ( ) is posted below:
As we can see in the picture above, the (7) is heavily in the overbought zone. But this, by itself, does not necessarily that the price action is due for consolidation in the near future.
Zooming Out to the H4 Resolution
On the H4 resolution, the value for the (7) is at 58.72 currently. Its plummeted pretty significantly and is in line with the current price action for (thus, no divergence).
One Thing Worth Noting
This is negative divergence in an unconventional sense (since we’re used to seeing the make lower lows while the price increases), but it is negative divergence nonetheless.
Again, this is on the H4 resolution, so there are not major consequences for the price, but this should be noted.
Zerononcense Double Guppy Channels (Custom)
Going back to the , we can see from the chart above that the Double Guppy Channel indicator is screaming to us that the price for is due for a correction to fit within the channel (orange portion).
Conclusion
It appears that will lightly consolidate in the next few hours/couple of days before continuing its path ever upward.
There are several more points of analysis that were not included within this price breakdown for the sake of not rambling on about the price forever.
However, consolidation seems imminent.
Therefore, this is the author’s proposed trading idea (R/R):
Disclaimer: Nothing written about should be construed, perceived or accepted as financial advice. This is not written in advocacy of any personal finance strategies. The information above is simply an idea being promoted as an example of how one can form their own independent trading strategies. Whether the author has designated that they would place a long or short position or abstained from trading is solely their own prerogative; it is not meant to sway your own personal investment strategy.
Published at Wed, 20 Feb 2019 00:04:52 +0000
