There is no denying that after reaching an all time high in December of 2017 and subsequently crashing to mid-2017 levels, the cryptocurrency market is currently in bearish territory. Nothing can be more indicative of this trend than the seismic shift in emotions exhibited by the Crypto-Twitter community. In a matter of months, keywords have veered from the euphoric "to the moon" and "when lambo" of late December to "when ramen" and "bitcoin is a scam" in early March.
Everyone in the crypto world is eager to know when next bull run will begin. Unfortunately, nobody, including the brightest technical analysts, know the answer. That being said, one thing the cryptocurrency community can agree upon is that the next bull run will come, and that Bitcoin will achieve new all time highs as cryptocurrency fundamentals are stronger now than ever. In the mean time, here are pricing highlights of Bitcoin and Ethereum as of March 18, 2018.
On daily, Bitcoin has attempted to break the trendline resistance on log scale on two occasions and failed. The first attempt was on January 6th, when the Bitcoin price reached $17,200 and turned back. The second attempt came on March 5th, when the price reached $11,528 and proceeded to fall back.
According to the famous wall street Psychology of a Market Cycle thesis, the high of $17,200 was a classic bull trap. The price pattern leading up to $11,528 resembled an potential inverse head and shoulders pattern. Had this pattern been completed (confirmed via daily candle closure atop of log trendline resistance), we would have been on our way to a new Bitcoin moon of $22,000 according to classical charting principles.
As of today, 18 March 2018, Bitcoin is consolidating alongside a trendline support drawn from highs of early 2017. If this trendline support is breached the next support zone will be the middle greenbox between $7,000 and $7,400.
To break out of the downwards trend, Bitcoin must rise and breach the top greenbox with a high of $9,800. Until then, we need to prepare ourselves for the potential of more downwards movement.
Similar to Bitcoin, Ethereum has twice failed to break out of the trendline resistance on log scale. The first attempt, a bull trap, occurred on January 29th when prices reached $1,228 and turned back. The second attempt was at the high of $997 on February 18th.
I advised my Twitter followers (@8bitandstuff) to short Ethereum when support of $785 was breached. The low of $450 has yielded a profit of 42%.
Similar to Bitcoin, unless Ethereum breaks out of the trendline resistance on log scale (indicated by closure of daily candle atop of resistance), we can continue to expect more downside.