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07 January 2020

Technical Analysis Tuesday: a positive start into the new year

Patrick Heusser

Patrick Heusser

Senior Trader at Crypto Broker AG

About the author

This is the first TA-Tuesday of 2020. As already announced, we will now start adapting our focus on smaller cap coins, if we see any moves that are particular or interesting. Bitcoin and Ether will remain an integral part of our analyses no matter what.

BTC$ (weekly)

I only want to take a quick look at the weekly chart. The fact that we have reacted now gives me some confidence that the price is trying to respect the lower band of the Ichimoku cloud.

On this chart, I see no evidence for a retracement down, and expect to reach the target of 8.6k (first green line) within the next 2-3 weeks.

But let’s not jump to any conclusions just yet…

BTC$ (daily)

The picture here looks slightly different. The 8k level has a few hurdles to take before we reclaim the 8.6k level.

E.g. the lower band of the Ichimoku cloud is converging with it. Additionally, we have the next liquidity pool at around the 8k level, and the red dotted line shows that around that level we had some rejections on both sides (on the way down and on the way up).

So, a move back down to the 7.2k area is not off the cards. Especially due to the fact that there is a liquidity vacuum between 7.4k and 7.9k.

The 8.6k target we pointed out on the weekly chart would fit nicely into the daily Ichimoku cloud pattern on the daily chart. If we get to this level, the price would have just pushed through the upper band of the cloud. We have not seen this since early September 2019.

We have played the move up, but are now thinking about reducing some longs. The core position will stay long, but it might be time to take some chips off the table.

ETH$ (weekly)

At first sight things here do not look very bullish. Our takeaway is that $135 is an important level on a closing basis.

ETH (daily)

There is still a long way to go to call this “baby” bullish, but the reaction between December 2019 and now is/was pretty strong.

You can see that our “out of the woods” target is at $170, which is roughly another 20% away. There is no clear set-up to be positioned either way, and therefore we are staying on the sidelines for now.

BCH$ (daily)

Bitcoin Cash has shown a very strong performance since mid-December 2019. It even outperformed bitcoin by miles.

Since it was a heavily bashed coin in November, it was no surprise that it showed some counteraction. What is surprising, though, is the magnitude of it.

The price even managed to break into the Ichimoku cloud, which we did not even see from the other well performing larger cap coins. The upper band of the cloud is only another $15 away from the current price.

It is not an asset we particularly like to have in our portfolio, but it is worth keeping an eye on it as the past has shown that it can have a kind of front-runner characteristic (a bit like Litcoin).

ATOM$ (daily)

It was the Q4 2019 darling. By the end of 2019, some strong resistance came in at around $4.55.

The start of the new year was pretty miserable, but the overall bullish tone still persists. The trendline (black) looks solid with three clean touching points. Therefore, we will keep a small long core position as long as this trendline holds, and we will add to the longs if we break through the resistance (green line).

DASH$ and XMR$

Privacy coins had a good run-up into the start of the new year. Especially DASH (daily chart above), which experienced a large price move accompanied by a gigantic volume on Binance.

We are not convinced that this is a trend reversal quite yet. Judging by the Ichimoku cloud, we are in a similar stage as with Bitcoin.

Our general impression of the first few trading days of the new year are pretty positive. When looking a bit closer at the three FTX indices, we see a rather mixed picture. There is no clear pattern of a particular sector or category of coin performing well or poorly. It is a fairly mixed bag.

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