Cryptocurrency Market Analysis for January-February 2019

Tech Analysis

Summary

  • Bitcoin starts the year at $3,817; range-bound for the better part of the month; and attains a new high of $4,200.
  • ETH starts the month at $123; attains new high of $145 before pulling back to $100.
  • LTC starts the month at $31; reaches a high of $40 before pulling back; range-bound for the better part of the month.

Bitcoin (BTC/USD)

BTC started January 2019 at a price of $3,817. For the following few days the currency traded sideways before it finally managed to break the resistance level of $4,000, gaining momentum to new highs and then pulling back to just below $4,000. Between 3-5 January, BTC was on consolidation and seemed to find support at $3,850 and resistance at $4,000 once again. On 6 January, resistance levels were broken as the currency rose by around six per cent to achieve a new high of $4,200. The price then consolidated until 10 January when it broke its support levels of $3,800 for a new low. From then on, one-hour charts show that the cryptocurrency was exhibiting a contracting triangular pattern that broke out on the upward from 15 January onwards. After this, BTC offered a great opportunity for an intra-range trading strategy with support levels placed at $3,520 and resistance levels at $3,700. Sideways trading continued until 20 January when support levels were broken once again for a new low of $3,330. From then on, new ranges were defined with support at $3,480 (see chart) and resistance at $3,600. The support was breached again on 28 January (A) and the price found a new low of $3,200. Moving forwards into February, the market seems to be range-bound and again an intra-range strategy would be ideal: putting resistance at $3,400 and support at $3,200. Traders can enter long positions targeting resistance levels $3,400 (see chart) once the price bounces back from support or go short with their targets being the support levels at $3,200 once the price pulls back from resistance.

Ethereum (ETH/USD)

ETH started the year at $123. The price then rallied to reach a new high of $160 on 5 January. For the next few days until 10 January the price seemed to be range-bound, finding resistance at $155 and support at $145. These support levels were broken as the bears pulled the price further down to a new low of $112 on 14 January. One-hour charts during this period indicate that ETH was trading on a contracting triangular pattern. This was broken on 28 January (C) on the downward with a new low of $97. By the end of the month, ETH bounced back from this low and it seemed to find support at $100. Moving forward into February, the price appears bullish as it is recording greater highs on an ascending channel. A breakout on its resistance at $107 (see chart) is highly anticipated as it finds new highs on this channel. The price is then expected to find support at $110.

Litecoin (LTC/USD)

LTC started January at a price of $30 (A) and for the few days that followed, the bulls rallied the price to a new high of $40 (B). This was a healthy gain of over 30 per cent for LTC which was, however, short-lived as the bears initiated a price reversal to the downward that pulled the price back down to a new low of $29 by 15 January (C). For the next few days LTC was range-bound and seemed to find support at $30 (see chart) and resistance at $32 on the one-hour charts. Support levels of $30 were breached on 22 January before there was a price reversal where the price bounced back to over $30. LTC seems to be range bound at the close of January and it appears to find support at $29 and resistance at $33 (see chart) as we enter February. One-hour charts indicate a contracting triangular pattern with a bullish breakout expected that should push the price to new support levels of $31 as currently exhibited on its ascending trendline (see chart).

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