We are looking at the 4H chart for BTC/USD and we can see right away that Bitcoin has done practically nothing for the past few days. It has traded sideways but there is a changing outlook now that signals potential further upside in the near future. That being said, the big picture remains intact and we do not think BTC/USD has much room to go up from here. However, altcoins like Ethereum (ETH) have plenty of room to go up yet and it is likely that they will capitalize on that. The daily chart for ETH/USD shows how the price shot up towards the 50 day EMA even though it couldn’t succeed in breaking above it. Ethereum (ETH) has now begun its day in red and is still trading below the 50 day EMA but at the same time, it has firmly held the 21 day EMA as support.
This changing outlook points to the strong probability of ETH/USD rallying towards $200 from current levels. This is in line with what we have been discussing the past few days. I have been mentioning in my videos that I’m not as convinced yet that we are in a downtrend as far as altcoins are concerned because we have yet to see Ethereum dominance (ETH.D) test the 200 day EMA. Every time before a strong downtrend we have seen this level being tested and I don’t think this time will be any different. If the price rallies higher from current levels while Bitcoin (BTC) trades sideways then we might see Ethereum dominance finally test the 200 day EMA.
The daily chart for EUR/USD points to the strong probability of a sharp downtrend from current levels but at the same time, if EUR/USD were to break past the trend line resistance to continue higher towards a retest of the previously broken support turned resistance of the descending triangle, then we might see the cryptocurrency market rally near term. Most of such rallies would be seen in altcoins but Bitcoin (BTC) could also invalidate the smaller descending triangle short term to mislead investors. This would be the ideal setup for market makers to shake out the bears and trap in the bulls which is why we needn’t lose sight of the big picture regardless of a changing outlook short term because it is very likely to be short-lived.