Bitcoin’s strong move above the $12,200 resistance could boost sentiment and lead to a stronger rally in select altcoins.
Investors usually buy large quantities of gold when they do not have faith in fiat currencies and want to protect their purchasing power against debasement. Berkshire Hathaway’s recent purchase of the Canadian gold miner Barrick Gold suggests that Warren Buffet is not confident about the future health of the U.S. and global economy.
Morgan Creek Digital Co-founder and partner Jason Williams believes that although Buffet might not directly invest in Bitcoin (BTC), it is likely that one of the younger managers will.
Daily cryptocurrency market performance. Source: Coin360
With gold making a sharp move today, Bitcoin has also followed it higher, which shows that their correlation in the short-term might be increasing once again.
Grayscale Investments has also widened its offering after its Bitcoin Cash Trust and Litecoin Trust received the green signal to deposit at the Depository Trust Company. This enables the products to list on major U.S. stock exchanges.
Let’s take a look at some of the strongest crypto assets to see where they might go this week.
Bitcoin broke out of its overhead resistance at $12,113.50 and if the bulls can close (UTC time) the price above this resistance the ascending triangle pattern will complete.
BTC/USD daily chart. Source: TradingView
This bullish setup has a pattern target of $13,702.55, which is just below the June 26, 2019 high at $13,973.50. If the price reaches this level it may act as a stiff resistance.
Currently both moving averages are rising and the relative strength index is in the overbought zone, which suggests that the bulls have the upper hand.
If the bulls fail to sustain the price above $12,113.50, Bitcoin price could drop to the 20-day exponential moving average ($11,457). A break below this support will be the first indication that momentum has weakened.
Ether (ETH) has been sustaining above the $415.634 level for the past few days, which is a positive sign. This suggests that the bulls are not waiting for a deeper correction to buy.
ETH/USD daily chart. Source: TradingView
If the bulls can sustain the price above $444.15, the uptrend is likely to resume. The next target is the $480–$500 zone. The upsloping moving averages and the RSI in the overbought zone suggests that the trend favors the bulls.
Contrary to this assumption, if the bears sink the price below $415.634, a drop to the 20-day EMA ($387) is possible. If the ETH/USD pair rebounds off the 20-day EMA, the bulls will again attempt to resume the uptrend.
A break below the 20-day EMA will be the first sign of weakening momentum and a break below $366 could tilt the advantage in favor of the bears.
XRP has picked up momentum after breaking out of the falling wedge pattern on Aug. 14. The bulls will now try to push the price above the $0.326113–$0.346727 overhead resistance zone.
XRP/USD daily chart. Source: TradingView
If they succeed, a rally to $0.40 is possible. The upsloping moving averages and the RSI in the overbought territory indicates advantage to the bulls.
However, if the pair turns down from the overhead resistance zone, then the XRP/USD pair could remain range-bound for a few more days.
A breakdown below the 20-day EMA ($0.28) will be the first sign of weakness. The trend will turn in favor of the bears if the pair plummets below $0.268478.
Chainlink (LINK) continues to be in a strong uptrend. Since the start of this leg of the up move on July 30, the altcoin has not corrected for three days in a row, which shows that the bulls are buying on every minor dip.
LINK/USD daily chart. Source: TradingView
The sharp rally of the past few days has pushed the RSI above the 80 levels, which suggests that the LINK/USD pair is heavily overbought in the near term. However, this alone is not a reason to fall because in May 2019 the RSI topped out close to 90.
If the bulls push the price above $20.1111, the uptrend can extend to $21.60 and then to $24.18. However, vertical rallies usually witness waterfall declines. Hence, traders should be careful not to be swayed away by greed.
On the downside, a break below $16 could be the first sign that momentum has weakened.
Bitcoin Cash (BCH) has broken out of the downtrend line, which invalidates a developing descending triangle pattern. The 20-day EMA ($292) is sloping up and the RSI has risen close to the overbought zone, which suggests that the bulls have the upper hand.
BCH/USD daily chart. Source: TradingView
The bulls will now try to push the price to $326.30 and then to $353. A breakout of this resistance is likely to result in a rally to $410 and then to $430.
However, if the bears defend the overhead resistance at $353, the BCH/USD pair might extend its stay inside the range for a few more days.
The trend will turn in favor of the bears if the pair turns down and breaks below the $280 support.
Litecoin (LTC) picked up momentum after breaking above the descending channel on Aug. 15. The bulls are currently attempting to push the price above the overhead resistance at $65.1573.
LTC/USD daily chart. Source: TradingView
The 20-day EMA ($57) has started to slope up once again and the RSI is close to the overbought zone, which suggests that the bulls are again back in the driver’s seat.
A breakout and close (UTC time) above $65.1573 is likely to start the next leg of the up move to $80 and then to $84.
However, if the LTC/USD pair turns down from the current levels, it could drop to the 20-day EMA. A break below this support could sink the price to $51.
Bitcoin SV (BSV) broke above the downtrend line on Aug. 15 but the bulls have not been able to pick up momentum, which shows a lack of demand at higher levels. The altcoin is currently facing resistance at $227.
BSV/USD daily chart. Source: TradingView
However, a minor positive is that the bulls have not allowed the BSV/USD pair to slip below the 20-day EMA ($217). If the bulls can push the price above $227, a rally to $260.86 is likely. A breakout of this resistance could extend the rally to $320.
Conversely, if the pair turns down from the current levels and breaks below the 20-day EMA, a drop to $200 is possible. A break below this support will shift the advantage in favor of the bears.
Cardano (ADA) remains range-bound between the $0.13–$0.15 zone, which suggests a balance between supply and demand. It is difficult to predict the direction of the breakout, hence, traders should wait for the price to make a decisive move before entering any trades.
ADA/USD daily chart. Source: TradingView
The 50-day SMA is sloping up, which suggests that the medium-term trend remains in favor of the bulls. If the buyers can propel the price above $0.1543051, the next leg of the up move is likely to start. The next target to watch out for is $0.20.
If the bears defend the overhead resistance at $0.1543051, the ADA/USD pair could extend its stay inside the range.
A breakdown and close (UTC time) below $0.13 will signal the possible start of a deeper correction to the $0.11–$0.10 support zone.
The bulls are attempting to push EOS above the overhead resistance at $3.8811 but the bears are defending this level aggressively.
Both moving averages have turned up and the RSI is in the overbought zone, suggesting advantage to the bulls.
EOS/USD daily chart. Source: TradingView
If the bulls can sustain the price above $3.8811, a rally to $4.85 and then to $5.40 is possible. There is a minor resistance at $4.4 and again at $4.6 but both these are likely to be crossed.
However, if the EOS/USD pair turns down from the current levels, a minor consolidation or correction is possible. The momentum might weaken if the bears sink the pair below the 50% Fibonacci retracement level of $3.4052.
Binance Coin (BNB) is facing resistance in the $22.93–$24.4588 resistance zone, however, the positive sign is that the bulls have managed to keep the price above $22.93 for the past two days.
BNB/USD daily chart. Source: TradingView
The moving averages are sloping up and the RSI is in the positive zone, suggesting advantage to the bulls. Above $24.4588, a rally to $27.1905 is possible. The bears are likely to defend this resistance aggressively but if this level is scaled, the next target is $32.
This bullish view will be invalidated if the BNB/USD pair turns down from the current levels and breaks below $20.50.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Market data is provided by HitBTC exchange.