Daily Crypto Analysis - 26th Jan - Technical Analysis
Bitcoin
(Bitstam:BTCUSD 1h)
After making a retest of the previous high and forming a double top, Bitcoin proceeded to drop sharply down to $10263. Sharp rejections of highs such as this are a bearish sign here, however we also saw a subsequent sharp rejection of the $10260 lows, which might be seen as a double bottom on this move.
As previously, I still maintain the bearish outlook here until we see a break of $11910.
(Bitstamp:BTCUSD 4h)
On the higher time frame, we appear to have found an ascending support. But we are also making lower and lower highs on every bounce, so a break through said support is looking likely.
A break downwards here could be of similar magnitude to the previous leg down, which was ~$5000. Measured from the ascending support at around $10000, this gives a target price of ~$5000.
While I am very sceptical that it would drop this far on a signal leg down, if investor panic sets in then it could be possible.
Ethereum
(Bitstamp:ETHUSD 4h)
Ethereum is seeing a triangle formation too, but with a significant bullish bias. I'm inclined to call this a large bullish consolidation, as opposed to Bitcoin's bearish triangle. However we know that ETHUSD will usually follow strong dips in BTCUSD closely, so a bearish break for Bitcoin could result in a break downwards here too.
(Bitstamp:ETHBTC 4h)
A higher time frame view of the channel we've been watching for the last week. On the ratio, we certainly look like a bullish consolidation pattern. A break downwards on Bitcoin may set back the next bullish leg a bit, but a longer consolidation is never a bad sign.
Bitcoin Cash
(Poloniex:BCHBTC 4h)
Bitcoin Cash has pushed down yet again. This break of 0.1451 is looking particularly bearish short term.
However, in terms of Wyckoff theory, this may be seen as the "creek" of a reaccumulation phase, where price slowly glides lower to try to shake traders out of long positions before a huge spike (Jump across the creek) which takes out shorters.
We need to wait for the "jump across the creek" before this is any more than just hypothetical, but I would recommend caution for this pair.
Neo
(Bitfinex:NEOBTC 4h)
Neo remains within its consolidation area. It is getting close to a test of the major ascending support, so the next leg up may be imminent. But if not, a longer consolidation would make a good base for when the next bullish leg decides to move.
Disclaimer
I will do my best to give unbiased, objective analysis, but I can make no promises about my accuracy.
All posts are based on my personal opinions and ideas and do not constitute professional financial investment advice.