Crypto Frontline

BTCUSD (Coinbase)

Bitcoin managed to stage an impressive rebound during the last week, on the back of softer US inflation data. Lately, the market has been energized by the new crypto-friendly administration in the White House.

Since BTC just broke above the December 2024 highs, our next upside target is $120k. Usually, breakouts are supported by FOMO and follow-through flows that exacerbate the move, so this isn’t the right time to start shorting.

As always, it will be better to remain patient and wait for a pullback. The 20 EMA on the 4h chart or the ascending trend we’ve drawn could be proper entry locations. Our sentiment will shift to neutral if BTC drops towards the $100k mark again.

If that happens, we need to see a strong bullish reaction. Otherwise, the price could continue to weaken to $95k or $90k. The enthusiasm should hold for a couple of days, but remember that the recent surge in prices is solely based on expectations that haven’t yet materialized. A disappointment will be devastating for sentiment and thus, valuations will have to mean-revert aggressively.

ETHUSD (Kraken)

Ethereum has been chopping around the 200 SMA on the 4h chart for a couple of days, suggesting that’s an important dynamic resistance. At the same time, since the market is currently focused on pumping up meme coins, attention has shifted away from large-cap cryptocurrencies.

This meme mania will end like the previous ones and that’s when traders and investors will shift attention back to tokens like ETH where there could be value to be squeezed. In the meantime, we think the market should be upbeat this week and a break above the 200 SMA seems likely.

If that happens, bulls have to breach the bearish trend line as well to revive hopes for a $4,000 retest. BTC is at new all-time highs while Ether has some room to cover before reaching last year’s high. This status of an underperformer will be favorable when flows start to shift to beaten-down coins.

XRPUSD (Kraken)

Most Trump family members seem to be launching meme coins these days and while some traders are drawn by the massive volatility there, we believe there are also high risks attached. For that matter, we would like to continue focusing on established altcoins, hence XRP is back in our weekly analysis.

The token price briefly reached a new ATH on the back of positive news in the US. More specifically, it is rumored that the new administration will enact laws favoring cryptocurrency projects owned by US companies. Ripple could be a beneficiary, so the market is front-running that.

You can see that once the price broke above the triangle consolidation we talked about several weeks ago, it was off to the races. XRP continued to push higher and stalled around the all-time high. Despite a 2-day pullback, buyers seem to be back in action, so we expect a new round of buying this week.

For that matter, $3.5 and $4 are key resistance levels to watch. We think there is scope for some further upside, given enthusiasm can push valuations to extremes.