BTCUSD and XRPUSD Technical Analysis – 04th JAN 2022


BTCUSD: Double Bottom Pattern Above $45,000

Bitcoin started this week on a bearish tone, and the price continued to slide touching a low of $45,725 on 3rd January, after which we can see some fresh buying in bitcoin markets globally.

Some pullback action can be observed in the European trading session today, and the prices of BTCUSD are ranging above the $46,000 handle.

We can clearly see a double bottom pattern above $45,000, which signifies the end of a downtrend and a shift towards an uptrend.

Both Stoch and StochRSI are indicating an OVERBOUGHT level, meaning that in the immediate short-term, a decline in the prices is expected.

With global cryptocurrency markets staging mixed trading signals we will have to wait before entering into any buying positions in bitcoin.

The relative strength index is at 52 indicating a NEUTRAL market and a move towards a market consolidation phase.

Bitcoin is now moving below its 100 hourly simple and exponential moving averages.

The average true range is indicating a lesser market volatility which means that markets are due to enter into a consolidation phase.

  • Bitcoin trend reversal is seen above $45,000
  • Williams percent range is indicating an OVERBOUGHT level
  • The price is now trading just above its pivot levels of $46,489
  • All moving averages are giving a NEUTRAL market signal

Bitcoin: Bullish Reversal Above $45,000 Confirmed

Bitcoin is forming a bullish trend pattern which means that the prices can start moving upwards due to the buying pressure that is coming into the global cryptocurrency markets.

The moving averages are giving a NEUTRAL signal; however, we have detected a MA 20 crossover pattern which is an indication for the bullish reversal of the markets. This bullish trend is mild and will have to wait till we can see a STRONG BUY signal from the moving averages.

All of the major technical indicators are giving a STRONG BUY signal, which means that in the immediate short-term we are expecting targets of $47,000 and $48,000.

The price of BTCUSD is now facing its classic resistance level of $46,639 and Fibonacci resistance level of $46,731, after which the path towards $47,000 will get cleared.

In the last 24hrs, BTCUSD has gone DOWN by -1.01% with a price change of 477$, and has a 24hr trading volume of USD 34.438 billion. We can see an Increase of 19.26% in the trading volume as compared to yesterday. This increase is due to the increased buying pressure seen after the recent decline in bitcoin.

The Week Ahead

We can see that bitcoin has started its upside correction after the decline and continues to trade above $46,500.

The recent decline we saw from the high of $68,984 reached on 10th November, 2021, happened due to the profit taking and the market liquidation by big investors and the global hedge funds.

The downside wave correction now seems to be finally over and we are ready for an upswing move towards the $50,000 handle in January 2022.

The short-term outlook is positive; the medium to long-term outlook remains BULLISH for bitcoin with targets of $55,000 to $60,000 in 2022.

BTC Gains in 2021

In 2021, we saw a 66% gain in bitcoin, which was lower than Ethereum’s 421% jump.

In contrast, we saw a marginal decline in the value of gold without any gains, whereas the US S&P 500 saw gains of 31% during the same period.

Bitcoin still remains the topmost cryptocurrency of the world with a total market capitalization of 881.48 billion USD.

Technical Indicators:

Commodity channel index (14-day): at 161.63 indicating a BUY

Average directional change (14-day): at 36.94 indicating a BUY

Rate of price change: at 0.399 indicating a BUY

Bull/bear power (13-day): at 316.27 indicating a BUY

XRPUSD: Descending Triangle Pattern Below 0.8600

Ripple started this week on a mild bullish tone, but was unable to sustain the momentum against the US dollar, and after touching a high of 0.8622 on January 2nd, it started to decline touching a low of 0.8211 yesterday.

At present, the prices of Ripple are ranging into a consolidation phase below 0.8500, and a further decline is expected in the coming days.

We can clearly see a descending triangle pattern below 0.8600 which signifies a bearish continuation of a downtrend.

The short-term outlook for Ripple has turned bearish, the medium-term outlook remains bullish, and the long-term outlook is strongly bullish.

StochRSI is indicating an OVERBOUGHT level which means that the prices are due to decline further.

Ripple is now trading just above its pivot level of 0.8273, and facing its classic support level of 0.8226 and Fibonacci resistance level of 0.8261 in the European trading session.

  • All technical indicators are giving a STRONG SELL signal
  • Ripple has entered into a bearish channel below 0.8600
  • All the moving averages are giving a SELL signal
  • Average true range indicates a LESSER market volatility

Ripple: Bearish Channel Below 0.8600 Confirmed

Ripple is now moving into a consolidation channel below 0.8500, and we may see more selling pressure which will bring down the prices of XRPUSD to 0.8000.

The prices of Ripple have dropped by 9% in a week, and the downward slide continues in the European trading session today.

The price of XRPUSD has gone DOWN by 1.18% with a price change of $-0.00990 in the past 24hrs, and has a trading volume of 1.576 billion USD.

We can see a 28.33% Increase in the trading volumes of Ripple in the last 24 hours. This Increase can be attributed to the selling pressure by the global investors who are looking to exit their Ripple holdings in view of the US SEC case decision pending in April 2022.

This Week Ahead

Ripple price is now in a consolidation level below the 0.8500 handle in the European trading session.

The relative strength index is valued at 34, which indicates a weaker demand for Ripple and more selling is expected in the coming days.

We are now looking at 0.8000 before the end of this week.

The short-term bias remains bearish for Ripple, and the decline is expected pushing its prices below the 0.8000 handle in the next week.

Technical Indicators:

Moving averages convergence divergence (12,26): at -0.004 indicating a SELL

Williams percent range: at -60.97 indicating SELL

Relative strength index (14-day): at 40.52 indicating a SELL

Rate of price change: at -0.654 indicating a SELL

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