IOTA is currently stuck in consolidation against both bitcoin and the US dollar. Triangle patterns can be seen on their 1-hour time frames and price is approaching the peak to signal that breakouts are bound to happen soon.
Against bitcoin, IOTA is in a bit of a descending channel as the top is steeper than the bottom. The 100 SMA is above the longer-term 200 SMA on this time frame so the path of least resistance is to the upside, but the gap is narrowing to indicate weaker bullish momentum.
Whichever way this breaks out, price could move by around 0.0002 or the same height as the chart pattern. Stochastic is treading sideways to signal further consolidation while RSI is slowly crawling higher to indicate that buyers are trying to regain control.
Bitcoin has regained ground after the pullback on the launch of futures on the CBOE. There was a brief outage on overcapacity but it looks like the technical issue has been resolved. CME and Nasdaq will be launching their own bitcoin futures soon and could lead to more demand for the cryptocurrency.
Against the dollar, IOTA has a bit more room to consolidate before reaching the end of the triangle. Price is hovering close to the triangle resistance at the moment and the 100 SMA is adding an extra layer of resistance.
The 100 SMA is above the longer-term 200 SMA to confirm that the path of least resistance is to the upside. This means that an upside breakout is more likely to happen than a downside one. Also, the gap between the moving averages is narrowing to signal weakening bullish momentum.
There are plenty of event risks lined up for the dollar this week, chief of which is the FOMC decision. A rate hike of 0.25% is expected and economic projections will be updated, likely providing clues on how tightening could proceed next year.
Other catalysts include Trump’s tax announcement and the release of CPI and retail sales figures later in the week.