Cryptocurrency Musings: Making A Break?
The BTCUSD has been incredibly choppy, with no trend to speak of for the past few days. However, a glance at ETHUSD, LTCUSD and XRPUSD tells a different story. The major cryptocurrencies are flagging and seem to be in the process of carving a base. Adding to this notion, is the fact that ETHBTC is at very significant support. This adds directional bias to the long side.
As I write, ETHUSD is breaking short-term resistance. Even in BTCUSD, support is holding, yet the picture is less clear.
Fundamentally, I favor Bitcoin over all other cryptos.Yet, the setups are cleaner in ETH, LTC, and XRP.
Sentiment-wise, the paradox is that while the sector is in a cyclical bear market, those hoping for lower prices overwhelmingly expect to be able to 'fill their bags' at bargain prices. Alas, I remind my crypto trader friends of the great Silver bull market of 2009-2011, and subsequent bear market. I can clearly remember traders begging for silver under $20 at $40, boldly proclaiming they would 'load the truck'. Yet, today XAGUSD trades under $15, and Silver has lost it's sheen. The market does not reward the expectations of the majority. Thus, crypto may punish those expecting lower prices with a relief rally.
I'm currently long ETHUSD, with a target of the 400 area. To be clear, this is tactical trading. I will exit any break of near-term support, and will consider this just a pit-stop before lower prices.
As I write, ETHUSD is breaking short-term resistance. Even in BTCUSD, support is holding, yet the picture is less clear.
Fundamentally, I favor Bitcoin over all other cryptos.Yet, the setups are cleaner in ETH, LTC, and XRP.
Sentiment-wise, the paradox is that while the sector is in a cyclical bear market, those hoping for lower prices overwhelmingly expect to be able to 'fill their bags' at bargain prices. Alas, I remind my crypto trader friends of the great Silver bull market of 2009-2011, and subsequent bear market. I can clearly remember traders begging for silver under $20 at $40, boldly proclaiming they would 'load the truck'. Yet, today XAGUSD trades under $15, and Silver has lost it's sheen. The market does not reward the expectations of the majority. Thus, crypto may punish those expecting lower prices with a relief rally.
I'm currently long ETHUSD, with a target of the 400 area. To be clear, this is tactical trading. I will exit any break of near-term support, and will consider this just a pit-stop before lower prices.
Komen:
The crypto space has suffered a harsh rejection in the past 48 hours. I exited my long positions in ETHUSD after I saw little reaction, compared to Bitcoin's recent run up. I'm currently neutral, waiting to see what the market does. ETH's decisive move down favors short entries, while Bitcoin is still in a neutral position. I see no set-ups in any of the major cryptocurrencies for now. I'm erring short, but I'm cautious to commit capital at this time.