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This week, attention has focused on the hard Bitcoin Cash (BCH) fork and the bad fight between the warring factions. This has led to an erosion of sentiment, and many believe that this is the reason for the sudden drop in encryption prices on 14 November. The fall has been serious and has dragged several cryptocurrencies to lows since the beginning of the year, breaking below the critical levels of support.
This is a great feeling of rupture because the technical picture on most digital currencies has worsened and will require a lot of time and effort to rectify. This chaos also led to new placements in the first five cryptocurrencies in terms of market capitalization.
So, after the fall, should investors consider this as a purchase opportunity, or should they wait for the end of the decline and a reversal of tendency before starting any long position? Let's find out.
XEM / USD
Usually, we stick to cryptocurrencies that have a market capitalization of $ 1 billion or more. However, we made an exception this week because, among the red sea of the first 20 cryptocurrencies, stands out the movement of the New Economy, which is the only one that has fallen less in the last seven days and continues to oscillate in the green once in a while.
The digital currency received a boost as Coincheck's Japanese cryptocurrency trade resumed NEM (XEM) trading for the first time since the infamous hacking when 5 billion dollars of NEM were stolen on January 5. This news led to a rally of about 35% on 12 and 13 November. So, what do the graphs foresee? C & # 39; is space for a further rally?
The digital currency is currently trading at 95% below its life highs of 2.14676437 hit on January 4 of this year. Due to the huge fall, it is difficult to analyze the weekly chart; therefore, we are using the daily chart for our analysis.
From the beginning of August, the XEM / USD pair is trading in the $ 0.13125258- $ 0.081984 range. Moving averages are flat and RSI has just plunged into negative territory. This indicates a continuation of the action related to the interval for a few more days.
The downward trend will resume if the bears manage to break the gap. In this case, the fall can extend to $ 0.05. On the upside, a new uptrend will start when the bulls will stay above this range. Traders must wait for the price to remain above $ 0.13125258 before buying. The first goal can be a rally at $ 0.2.
XRP / USD
In the recent fall, we have a new leader for altcoins: Ripple (XRP) has moved Ethereum (ETH) and assumed the role of second cryptocurrency by market capitalization.
A Malaysian bank, CIMB, has partnered with Ripple for cross-border remittances. With this partnership, Ripple is aiming for a big payout pie in the ASEAN region. Ripple's CEO, Brad Garlinghouse, also pointed out that it is likely to become the default international payment processor by dethrining SWIFT. The news was seen by market participants as positive, limiting the damage to its price. Let's see, what do the graphs foresee?
The XRP / USD pair did not give much ground, which is a positive sign. This shows that the bulls are eager to do it in decaying pieces. He is currently in possession of the small uptrend line. A break in this line will lower prices to the bottom of the range at $ 0.24508.
If the line is valid, the digital currency is likely to rise to the top at $ 0.76440. A breakout of this resistance could start a new uptrend, which has a target of $ 1,28372. There is a small resistance at $ 0.96490, but we expect this to be overcome.
XLM / USD
Stellar (XLM) has moved EOS to take its place among the top five digital currencies by market capitalization. His list on Bithumb he has been acclaimed by the markets, helping him to recover intraday losses. In another news, the maker of messaging apps Kik has moved from Ethereum to Stellar to develop his cryptocurrency, surnamed relatives.
The XLM / USD pair broke out from the downtrend triangle of the week before, which is a bullish signal. However, the decline in the last week brought it back to the downtrend line. If the bulls maintain this support and recover, we expect the digital currency to gain momentum above $ 0.305. The upward targets are $ 0.36 and $ 0.47.
However, if the bears push prices back into the triangle, it will fall into critical support at $ 0.184. Any interruption of this level will be negative and may lead to a resumption of the downward trend.
BTC / USD
After more than two months of low volatility, the range expanded downwards last week, causing Bitcoin to plummet to the lows since the beginning of the year. In this way, it broke under a descending triangle pattern, which is a bearish sign. Its market capitalization fell below $ 100 billion, the lowest level in a year. Several analysts have pointed to the hard fork of Bitcoin Cash as the trigger for the fall. After breaking the $ 5,900 support, analysts have a target of $ 1,500 in virtual currency.
However, Tom Lee, co-founder of Fundstrat Global Advisors, still has a year-end goal of $ 15,000 on Bitcoin. Although the new target is down from its previous $ 25,000, it is still about 167 percent higher than the current price. But what do the graphs foresee?
The BTC / USD pair is decomposed from critical support to $ 5,900 and is being held below. If the price closes the week under $ 5,900, the fall may extend to the first support at $ 5,450 and below $ 5,000. The objective of the narrow range decomposition model of $ 6,832 – $ 5,900 comes to $ 4,968. Therefore, we expect strong support near $ 5,000.
Our downward view will be invalidated if buyers carry prices above the break zone of $ 5,900- $ 6,075. If the digital currency remains above this zone, it will suggest large-scale purchases at lower levels. The trend will change if the bulls will climb $ 6.832. In that case, we advance the rally to push prices at $ 8,400 and over $ 10,000. Bottom fishing, especially when prices are wavering near the lows since the beginning of the year, is a risky strategy and should be avoided.
IOTA / USD
This week, the carnage was so serious that even the digital currencies that fell in double digits qualified as the first 5 performers. The IOTA Foundation recently announced the recruitment of a business developer, Pierre Hoffman, a former Microsoft employee and TOTAL. With its experience, the foundation expects to strengthen its presence in the European markets. During the week, the electronics giant Bosch and IOTA also announced a partnership for the launch of a data collection product for the Internet of Things (IoT).
After the remaining four weeks, the IOT / USD pair fell to new 52-week lows of $ 0.3501. However, lower levels saw some purchases, pushing prices above support at $ 0.4037. If the bulls maintain this support, the digital currency may try to move to $ 0.50 and over $ 0.61. We believe that any new position should be taken only after reporting a trend reversal.
On the downside, if bears fall below recent lows of $ 0.3501, they are likely to fall to $ 0.32. Below this support, the decline may extend to $ 0.1767- $ 0.1427.
Market data is provided by the HitBTC exchange. Analysis charts are provided by TradingView.