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Bitcoin (BTC/USD) has spent a second straight week consolidating the bounce off the June 2017 high and September 2017 low.
Given the holiday lull, BTC/USD will likely this week continue trading around the psychologically key USD4,000 whole figure level, particularly as it bumps up against a one-year downtrend/triangle resistance (on the weekly chart).
Some traders when drawing the first data point of this resistance line (in December 2017) will begin the line from the upper end of the body of the highest December 2017 weekly candle as opposed to the same candle's upper shadow's peak.
A line from the upper end of the same December 2017 candle's body of course would produce a downtrend resistance level that intersects roughly USD1,000 higher.
Nevertheless, with the daily RSI and Stochastics back into a neutral zone (after Stochastics became overbought last week), there could be a renewed push higher, particularly as the overriding weekly RSI, Stochastics and MACD remain bottomish.
Given the holiday period, BTC/USD will likely remain relatively tight in its range this week before a pronounced effort as early as Wednesday (first working day of the New Year) to test the one-year downtrend/triangle resistance.
A decisive break above the more conservatively drawn one-year downtrend resistance line at roughly USD5,000 will likely set a new trading range of USD4-6,00 over the coming months.
Ethereum also consolidates
Ethereum (ETH/USD) also consolidated this past week after strongly rebounding the prior week, roughly doubling off the 2018 low just a few weeks prior.
With ETH/USD having reclaimed the psychologically key USD100 whole figure level and at one point breaking this past week above USD150, ETH/USD appears to be gearing up for a retest of 150 potentially as early as this coming Wednesday once more traders are back in front of their screens.
Significantly, ETH/USD appears to have completed a descending wedge (on the weekly and daily chart), and will increasingly attract longer term bulls once a pattern of higher highs and higher lows begins forming.
ETH/USD spent the entire 2018 in a bear market. Will 2019 mark a turnaround year?
XRP rebounds then drifts
XRP (XRPJPY) rebounded strongly this past week, bouncing off a rising support line connecting the August, September and December lows. It has since drifted back towards this same support line.
Nevertheless, as Ethereum (ETH/USD) and Bitcoin (BTC/USD) have worked off an overbought Stochastics reading on their daily charts this past week, the sector appears to be laying the ground work for a sustainable major bottom after the formidable bear of 2018.
The rally this past week of XRP/JPY towards the psychologically key 50 whole figure level hints to bullish positioning in anticipation of a shift in sentiment away from bearishness to start the new year.
This content is not financial advice and should not form the basis of any financial investment decisions nor be seen as a recommendation to buy or sell any good or product. Trading cryptocurrency is complex and comes with a high risk of losing money, particularly if you trade on leverage. You should carefully consider whether trading cryptocurrencies is right for you and take the time to learn how trading works and decide how much money you are prepared to lose.
