Price behavior analysis, short to intermediate-term trade set-ups. Recently, the outlook was maintained that rallies in cryptocurrencies were likely to fizzle out rather than garner momentum – sellers’ bounces, if you will. This has obviously been an incorrect view in the near-term with the group continuing to rally strongly.
However, the longer-term outlook remains the same as far as this corner is concerned – lower prices as the massive bubble continues to deflate. Another solid test of the health of the market looks to be nearing, with Litecoin, Ethereum, and Bitcoin each approaching levels and lines which could turn upward momentum into downward momentum.
How they react will be of most importance, as price levels will either be validated as worthy points of resistance or not. That is, if sellers show up in earnest, then the outlook of another downturn will grow legs.
In the event we don’t see strong a strong turn in momentum, then the group is expected to continue its rebound. So, it will be all about watching price action this week.
In any case, volatility is expected to remain high for the foreseeable future, offering traders opportunities in both directions. See how positioning changes in cryptocurrencies and other markets can help as a tool to determine price direction on the IG Client Sentiment page. Read more from dailyfx.com…
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