Cryptocurrencies bitcoin and litecoin have been bearish in 2014. While bitcoin continues its bearish mode, litecoin is consolidating, with signs of life. Let’s take a look at their charts.
Bitcoin (BTCUSD) 4H Chart 10/1
(click to enlarge)
The 4H bitcoin chart shows a market that is bearish.
1) The 200-, 100-, and 50-period simple moving averages (SMAs) are sloping down, in bearish alignment, and price is below all of them.
2) The RSI has recently tagged below 30, and still remains below 60, showing maintenance of the bearish momentum.
3) And of course, we can see lower highs and lower lows.
Bitcoin price is now pulling back toward 400, where it would meet the 50-period SMA as well as some previous common lows. If bitcoin is to continue its downtrend, this could be a area of resistance. Also the 4H RSI should hold below 60, if the mode remains bearish in this time-frame. Otherwise, if price pushes above 400, and the RSI above 60, bitcoin could be back in consolidation, though the bullish outlook should stay on the shelf until a break above 450. A break above 450 would clear above the 200-period SMA, and a break above 453 would clear the previous resistance pivot. This would invalidate the 3 bearish technical points stated above, and thus introduce a bullish outlook, especially if the 4H RSI pushes above 70.
If bitcoin remains bearish, the next key support will be the 2014-low at 340.
(click to enlarge)
Litecoin was bearish in 2014 as well, but it has held a low of 3.33 since August. Unlike bitcoin, which continued its decline, litecoin has been consolidating. This week, after showing some signs of bearish continuation, it remained in consolidation as seen in the 4H chart.
1) Price is above the 50-period SMA.
2) The RSI never came down to 30, showing lack of bearish momentum. Now, it missed 70 as well, so there is no bullish momentum.
3) Price failed to breach a recent low around 3.90.
If price pushes above 4.80, it would clear above all the SMAs, and if it pushes above 4.90, it clears the previous week’s resistance pivot. This would introduce a bullish outlook at least in the short-term especially if the RSI also pushes above 70.
However, a hold below 4.80, with a dip back below 4.30 should revive the bearish bias. Even though litecoin would still be in consolidation, the bias would be bearish. Below 3.90, we have the August low of 3.33 before the 2014-low of 2.21.
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