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February 5, 2019

Crypto Technical Analysis. February 5.

Bitcoin

Bitcoin’s sustained trading below $4,300 in the last couple of months indicates that the market is setting the stage for another leg lower. A penetration of the $,3,100 technical level would signal that this downward move has been triggered. At that point, bitcoin will first target the psychological $3,000 support. A potential breakout there will open the way for a more massive slide toward $1,825.

 

Inability to break below $ 3100 would only extend the range between $3,100 and $4,200, but will not negate the bearish outlook described above. Only a violation of the $4,300 resistance, which is not our preferred scenario, would shift the mid-term outlook to positive.

 

We have a preference for short positions around $4,000-4,100, with stop losses at $4,400. Profits should be booked at $3,200.



Ethereum

The two failed attempts on the $160 resistance eventually led to a more substantial slide, which cleared the $110 support; afterwards, volatility subsided. Last week’s trading has been confined to a tight range between $100 and $109.

 

Our expectations are for ethereum to eventually break below the psychological $ 100. This in turn will pave the way for a test of the $80 lows, registered in December 2018. For this scenario to prevail, the cryptocurrency should keep on trading below $160.

 

We prefer to abstain from opening positions here and passively await to see how the situation will unfold, as the current risk-reward ratio does not justify trading on this front.



Ripple

One can clearly see on the chart the series of lower lows forming from September on, and the flat bottom at $0.28. This pattern, known as a descending triangle, indicates that ripple’s downtrend will be extended further as soon as the firm $ 028 support is violated. Should this happen, the cryptocurrency will target $0.2470, en route to $0.2240.

 

We are looking to sell ripple at a level close to $0.3070, with take profits at $0.25. Stop losses should be placed above $0.34.