The Russian central bank’s decision to block bitcoin exchange websites hardly caused any blip in its prices. Though it’s true that Russia has a small market share in cryptocurrency trading, still, this news should have unsettled the weaker bulls to sell because prices are close to the all-time highs.
However, the strength in the cryptocurrency near its highs shows that the bulls are unwilling to part with their positions. This increases the possibility of a breakout to new highs. So, what should you do now? Wait for a new high or book out?
Traders who initiated long positions at $4150 based on our previous recommendation are sitting on huge profits.
Though bitcoin’s price action is strong and a breakout of $5000 looks likely, we expect the zone between $4680 and $4975 to act as a major resistance.
Therefore, traders who went long at $4150 levels can book 50% profits at the current levels of $4808. We advocate booking partial profits to reduce the overall risk.
The stop loss on the remaining position, which was at $3950 should be raised to $4400. We expect the bulls to buy aggressively until the cryptocurrency stays above $4500. The cryptocurrency will turn negative on a fall below both the 20-day exponential moving average (EMA) and the 50-day simple moving average (SMA).
Ethereum continues to lag behind the leader, bitcoin. While bitcoin is close to its lifetime highs, ethereum has been stuck in a range for the past few days. However, its volatility has increased in the last two days.
The bulls have pushed ethereum above $317 on each of the last three days, however, they have not been able to sustain the breakout. As a result, the emboldened bears pushed the cryptocurrency below $278 levels yesterday, nevertheless, aggressive buying the bulls has again propped it above $300.
The digital currency will start the next leg of the uptrend once it breaks out and closes above $317. Therefore, we recommend long positions on a close above $317. The stop loss for the trade can be kept at $278. The profit objective is $354.
On the other hand, if the digital currency breaks down below $278 and sustains it, a fall to 241 is likely.
Litecoin continues to trade inside the range with a negative bias. Yesterday, the digital currency broke below the $50 mark and slid to $48.01 levels. Today, however, the digital currency has recovered and is attempting to climb above $50 once again.
Inside the range, price moves are likely to remain volatile. Therefore, we recommend buying litecoin at $46, on its way up from the lower end of the range at $44. This trade has a target objective of $56. The stop loss can be kept at $42. Please don’t buy when the cryptocurrency is falling because a break below $44 can sink it to $32.6 levels.
Another possible trade can be initiated on a breakout and close above $58, which has a pattern target of $71. The stop loss for this trade can be kept at $48.
* All the market data is provided by the HitBTC exchange.