Crypto Frontline

BTCUSD (Coinbase chart)

Bitcoin buying improved over the past week as the price continued to rise towards the $40k area, where it encountered short-term resistance yesterday. Overall, the price is heading towards the upper area of the corrective structure that started on January 8^th.

Buyers need to be aware that only if the price will break above it, should we consider more upside potential over the next few days or weeks. $45k or $50k would be areas to watch in case buyers won’t have trouble breaking above the current all-time high.

That had not happened yet, so we keep the consolidation stance in place until further developments occur. Support can be seen around the 4h chart 20 EMA. If the price break below it, the 200 SMA is next in line. A breakout below it will signal weakness in the buying appetite and will increase the probability for a continuation lower, probably towards the $30k area, where a floor had been in place since the beginning of January.

ETHUSD (Kraken chart)

Ether, on the other hand, had a much better performance, breaking to new all-time highs, while also respecting the ascending channel formation we’ve used for the past several weeks. As expected, resistance emerged around the upper line and now the price is consolidating lower, struggling to break below the 4h chart 20 EMA.

The RSI is also retracing lower after reaching overbought conditions earlier in the week. On prior occasions when the price reached the upper line of the channel, we’ve had decent corrective moves on the downside and that’s what we should expect to occur again.

In that case, support is expected around $1.430 and $1,350, two former short-term established in mid-January. A breakout below the channel + 4h chart 200 SMA will be a major warning sign for buyers and could unlock more downside potential. For the time being, we suspect that’s where strong buying could emerge, but until then, sellers have a lot of ground to cover.

ADAUSD (Binance chart)

Cardano is one of the best-performing tokens for the week, up almost 100% for the past 7 days alone. The price saw a massive surge towards 70 cents where it appears selling interest sparked. Since it managed to outperform the market by a large, we should be expecting a consolidative stance over the next week.

Traders need to pay attention to extreme overbought conditions, given the RSI is currently trading above 80. If selling intensifies, ADA could weaken towards 50 cents or even 40 cents, in the worst-case scenario.

Caution is necessary, given the price is heading higher parabolically and volatility can surprise both on the upside or the downside. The bright side is that Cardano managed to reach levels not seen since January 2018.

It is one of the high-ranking altcoins and follows on the same path Bitcoin and Ether had over the past several months. As long as the market exuberance continues, it shouldn’t be a surprise if Cardano plays catch-up and reached new all-time highs, as well.