Crypto Frontline

BTCUSD (Bitstamp)

Source: Tradingview

The price of Bitcoin settled down after the impressive move higher and now we see market participants focused on smaller altcoins. That’s where they can find higher potential for growth, so it should not be a surprise to see Bitcoin rather muted.

Based on our technical analysis, BTC is now locked inside a small ascending channel formation. Although the 4h chart 20 EMA continues to act as support, the price is no longer able to generate solid returns. This puts both sides of the market in a tough position.

Buyers, on one side, continue to have the bigger picture in their favor, yet weakening gains might be an early sign for a deeper correction. As a result, if the price breaks impulsively below the structure highlighted in the chart, we suspect BTC is poised for a retest of $31,800. Below that, $31,000 is another notable support area.

It’s possible to see the market breaking above the channel and that would act as a buy signal. Bitcoin could head towards the $39,500 resistance, where we expect stronger selling pressure.

ETHUSD (Kraken)

Source: Tradingview

Ether seems to be in a slightly better position than Bitcoin since the price action shows a greater imbalance between bulls and bears. Similarly, the 4h chart 20 EMA is where bullish pressure resumes, so as long as that stays in place, we expect further gains.

The major area we have discussed multiple times in the past is $2,000 and it becomes increasingly likely that the major target for ETH. We are not that far from the level and with a bullish tailwind still consistent, we should see the price reaching the target during November.

Conversely, if the 20 EMA will no longer cap the downside, a deeper correction will be favored. Even in that scenario, we see limited downside. The key support area to watch is $1,750, a place where the market rebounded recently. Shorting the market at this stage is tricky based on our assessment.

XRPUSD (Kraken)

Source: Tradingview

We see better returns in the altcoins space and XRP is a great example. The token rose 22% last week and the prospects have improved substantially. While there was a burst of buying in July, after favorable news in the clash with the SEC, the market faded the entire move.

The price consolidated around 45 cents and after trading inside a range for a few weeks, the break above the daily 200 SMA has been the widely expected bullish trigger. There is scope for added gains in the near term and traders should watch for resistance around 75 and then 85 cents. Those are the levels to keep a close eye on.

A pullback should not be neglected and we think the price should find support around 60 cents and the daily 20 EMA. As long as we stay above the 200 SMA, the sentiment will continue to favor the upside. In the longer run, there is now a greater probability for a retest and even break above the $1 mark.