Virtual currencies Bitcoin and Litecoin was bearish last week but found support at the end of the week. Over the weekend, we saw price action in both cryptocurrencies form price bottoms. Let’s take a look at their intra-session charts.
Price Bottom: The 1H bitcoin chart shows price find support at 340. There was some consolidation in the past couple of sessions, but it is entering the new week with a bullish signal as price breaks above a common resistance around 362. The 1H RSI also tagged 70 showing some near-term bullish momentum.
Testing the Price Bottom: Now, if bitcoin retreats, we will see if the price bottom will hold. If the market is turning bullish to start the week, we should see price hold above the 355 area, which is going to be reinforced by a near-term rising speedline, and is also where the 100-, and 50-hour SMAs are clustered. The 1H RSI should also hold above 40 if the bullish momentum in the near-term is going to be maintained.
Targets: To the upside, targets for the upcoming sessions will be around the 385-390 support/resistance pivot, with a more aggressive target towards some recent common highs in the 400-405 area.
Bearish Continuation Scenario: Now failure to push above 370, and a break below 350 would be a bearish continuation signal that would open up not only the 340 low, but the 318, November low.
Consolidation: Litecoin has yet to establish a price bottom, but it has been consolidating above 3.4. There is resistance in the 3.60-3.65 area, which is reinforced by a falling speedline from a couple of week’s ago. The 1H RSI shows that the bearish momentum is lost, but there is no bullish momentum yet.
Outlooks: If price does break 3.65, there is still resistance in the 3.70 area. However, let’s say price falls back from 3.70, if it can start holding above 3.50, we might have a price bottom, and there could be upside risk back towards the 4.0 handle. However, if we see a break below 3.50, litecoin would likely be in a bearish continuation to 3.40, then to the 3.33-3.38 August-October lows.
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