The crypto market prepares to launch a bear trap

[ad_1]

The price of bitcoin risks misleading traders who expect a seasonal / cyclical price collapse. The price of Ethereum quietly converts into a bull market on the Point and Figure chart. XRP price depends on Ethereum and Bitcoin for directional bias.

Bitcoin price action ends six weeks in a corrective move, the second longest correction period of 2021. The price of Ethereum has changed momentum, likely trapping traders who exclusively use Japanese candlesticks. XRP price action is stagnant and is likely awaiting a clear directional move from Bitcoin and Ethereum.

Bitcoin price shows first signs of further uptrend, likely disappointing many short sellers

The price of Bitcoin has started the process of converting from a bear market on the $ 1,000 / 3-box Point and Figure chart to a bull market. The December 5 lightning crash brought Bitcoin to a low that was precisely on the neckline of a previous inverted head and shoulders pattern. The resulting price action created an opportunity for a long entry.

BTC / USD $ 1,000 / 3 Boxes Table of Reversal Points and Numbers

The hypothetical long entry is a buy stop order at $ 50,000, a stop loss order at $ 46,000 and a profit target at $ 69,000. A trailing stop of two to three boxes would help protect any implied profits after the entry. This transaction is invalidated if the price of Bitcoin drops to $ 40,000 before the entry is triggered.

Ethereum price action may trap bears

Ethereum’s price has moved to a bullish market after breaking above the previous downtrend line at $ 4,150. This conversion leads the Japanese candlestick chart, which still shows a mix of bearish to neutral conditions. This development has generated a long theoretical opportunity for Ethereum.

The theoretical long entry is a buy stop order at $ 4000, a stop loss order at $ 3750 and a profit target at $ 5600. The long entry would be the first entry after removing the conversion. This is a sign of significant force on a Point and Figure chart.

ETH / USD $ 50/3 boxes Table of reversal points and numbers

However, downside risks remain. Ethereum price must maintain a support level above $ 3,700 otherwise the current Point and Figure chart will return to support market conditions. If that happens, Ethereum will likely move back into the $ 2,800 to $ 3,000 value areas.

XRP price stuck in narrow range, directional bias unclear

The XRP price has made little effort over the past ten trading days to establish a clear direction beyond consolidation. It has developed a strong support and range structure between the $ 0.75 to $ 0.80 price brackets. Compared to previous XRP analyzes, not much has changed.

The $ 0.05 / 3-box reversal dots and digits graph shows the same pattern entry examined over the past few weeks. A hypothetical long entry would occur on the three-box reversal with a buy stop at $ 1.00, stop loss at $ 0.80 and a profit target at $ 1.70. This trading idea does not have an invalidation point as the entry would cause further bearish movement.

XRP / USDT $ 0.05 / 3 Boxes Table of Reversal Points and Numbers

If XRP bulls wish to prevent further downward movement, buyers will need to maintain short-term support. Failure to do so would likely trigger a move towards the $ 0.50 value area.

[ad_2]