Weekly crypto market analysis from Geco.one 22.03.2021
The quotations of many popular cryptocurrencies such as Bitcoin or Ethereum have remained relatively stable over the last few days. On the other hand, some of them have dropped to interesting support levels, the rejection of which could open the way for further increases. Are we then on the eve of another upward impulse and establishing a new ATH in this market?
Looking at the quotations of the oldest virtual currencies, we will notice that the current sideways trend has led to the formation of an isosceles triangle formation, a neutral formation from a purely technical point of view. It means that the mere formation of such a triangle does not herald either potential increases or decreases.
Relating this particular pattern to the current market situation, however, it can be concluded that it is a form of a correction, which is a rebound from earlier increases, which could increase the likelihood of a breakout and a continuation of increases to around $ 62,000 or higher.
The current technical situation on the Ethereum quotes is also quite optimistic, as the rate has been stabilizing for several days around the recently defeated resistance (now support) of $ 1,730. If this zone is permanently rejected, we could expect an increase in the previous peaks’ vicinity, i.e. USD 1,960–2,000, soon. Going above these zones would mean setting a new historical record, which could naturally open the way for a further increase in this cryptocurrency quotation.
Chainlink is also currently trading in the area of technical support, the rate of which has slipped to around $ 29, where the upward trend line runs presently, marking the lower boundary of the ascending rectangular triangle formation. If there is a demand reaction near this support, signalling its rejection, the LINK price could increase soon to USD 31.90 (green zone in the chart below), or even to USD 36.35.
Looking at the Litecoin (LTC) quotes, we notice that price has been moving for some time in a horizontal trend, the upper limits of which coincide with the measurement of 38.2 per cent. Fibonacci adjustments from earlier declines. Considering that, from a technical point of view, a consolidation is a form of correction, in this particular case, we could think it to be a kind of rebound after previous declines, which in turn increases the likelihood of a possible breakout, i.e. falling below the currently tested support for $ 194. If that happened, the price of LTC could even slide close to the upward trend line, i.e. to $ 180.
The current situation on the Stellar quotes, which has been trading between USD 0.37 and USD 0.44 for some time, is also quite similar. In this case, it also looks like a kind of correction after earlier declines, which increases the probability of a breakout from the consolidation bottom. However, it is worth noting that if this happened, the downward potential here would be much greater than in Cape LTC. The price of XLM could drop even to the level of USD 0.23. It is only there that the next significant level of support is found.