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Technical Analysis: Bitcoin stubbornly nonvolatile as altcoins take some of the limelight

In this week’s technical analysis, Marco Bozza explores the nonvolatility of Bitcoin compared to the altcoins which are stepping up in the market.

Written by Marco Bozza Published on

Now that there is some semblance of normalcy (well, normal is maybe a stretch) in the cryptocurrency markets, is there anything that’s remotely tradeable in Bitcoin or altcoins? Besides last week’s pretty sizable arbitrage opportunity (short the premium on Bitfinex and long the discount on Bitmex or Deribit), tradeable long-term Bitcoin positions are still on hiatus, unless you are making use of a short-term chop trading strategy on $100 moves

Due to the lack of action on Bitcoin and the majority of high cap alts, it seems like the market has ventured into low/mid cap coins in order to extract some value out of them during this uncertain time. Coins like Ravencoin and Haven Protocol had great returns for traders, but those pumps are likely at the tail end, likely with a new contingent of bag holders created as I type. Altcoins seem to be hogging the attention of traders, so it’s only prudent that we turn towards trading those when Bitcoin does not want to give a clear trade.

Altcoin trades in this environment should be taken cautiously, and have realistic returns—not every coin will pump like Ravencoin or Haven. Low cap coins are not usually where I venture, especially in a sustained bear market. Historically, though, the pumps in low cap alts do flow back up into higher cap alts, so perhaps there are some higher cap alts to pay attention to.

Monero


Monero Trade Plan by Pansyfaust on TradingView.com

Compared to many altcoins, Monero has performed quite well to currently maintain around 50% of its BTC value from its all-time-high. Whereas most of the major altcoins have fallen just short of dumpster fire devaluations from their all-time-highs (Ethereum -75%, Litecoin -68%, DASH -74%, Ripple -70%, Cardano -87%) Monero is currently at -51%. It’s shown remarkable resilience in its bitcoin value, and on the back of some positive fundamental news regarding its Bulletproof update, could be primed for a bit of upside.

After a convincing ‘W’ bottom, and rounded retest of the breakout zone, this current push could have the bullish legs to take this to 0.019-0.02 XMR/BTC.

Dogecoin


DOGEBTC Trade Plan by Pansyfaust on TradingView.com

Way back in September Dogecoin had a bit of a run to 110 satoshis, and at the time I suggested to either sell your longs or short doge on Poloniex. Now that we’re at the 0.618 retrace at 64 satoshis, we find ourselves at an optimal entry. Our exit is conservative, simply because I don’t think the market is ready for a sustained bullish pump to new highs on altcoins. Other technical also show this as a confluence zone based on past price action here as well as the RSI indicator bottoming out. Bear in mind, 73 satoshis could also be a sensible zone to take some profit off the table.

EOS


EOS Trade plan by Pansyfaust on TradingView.com

EOS/BTC has been consolidating in a bearish pennant, which history suggests consolidation followed by continuation to the downside. Although, as traders, every outcome should be considered and planned for, so an upside break can also be traded.

Currently the wider cryptocurrency market is experiencing lowered volatility, even with the current mini altseason. Although there are outliers that are able to create 100% gains, lowered volatility overall does mean traders need to be extra picky with their trades—finding the right structure and confluence in your trading will matter the most in these nonvolatile times.

Start trading cryptocurrency with Coindirect.

Written by

Marco has been involved in cryptocurrencies since late 2013, a part-time cryptocurrency trader since 2016 and has transitioned into full-time cryptocurrency trading in 2018.

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