The Bitcoin value has not only risen in price but also in institutional which is one of the major reasons for the new all-time high. Along with the spot markets, institutional investors are known to use the derivatives route to invest. Due to this, the CME Group, recently became the largest Bitcoin futures market, overtaking OKEx, according to Arcane Research. In yet another positive, Guggenheim Macro Opportunities Fund sought approval from the US SEC to take exposure in Bitcoin through the Grayscale Bitcoin Trust. The fund plans to invest up to 10% of its net asset value of $5 billion in Bitcoin.
BITCOIN VALUE FUNDAMENTAL ANALYSIS
PayPal’s crypto adoption has been one of the major factors that started the current bull run. A report by crypto investment firm Pantera Capital highlights that PayPal has been buying about “70% of the new supply of bitcoins.” According to Pantera, the remaining 30% of the supply is being lapped up by Cash App. This has created a shortage, which could be one of the contributing factors to the recent rally.
Global Macro Investor and Real Vision CEO Raoul Pal said in an interview with Cointelegraph that Bitcoin value could rally to $150,000 by November 2021 and if the institutional buying picks up further, the biggest cryptocurrency could even reach $250,000.
In a separate report, data suggests that gold is under a bear grip and the weekly outflow has hit a new record. This suggests that some investors are booking profits in gold. Crypto analysts believe that some of the money from gold could enter the crypto markets and that may boost Bitcoin’s value further.
While possibilities are huge, traders should not get carried away by lofty targets. It is better to invest by keeping an eye on the risk. Let’s analyse the charts of the top-5 cryptocurrencies to spot any possible buy setups.
ALL-TIME HIGH BITCOIN VALUE TRADING – HOW TO TRADE BTC/USD
Bitcoin value corrected sharply on November 25 and 26. Although the price dipped below the 20-day EMA, the bears could not capitalise on this weakness and sustain the lower levels.
This suggests that traders viewed the fall as a buying opportunity. The strong bounce off the 20-day EMA has carried the bitcoin value near the psychological resistance of $20,000, as suggested in the previous analysis.
The upsloping moving averages and the RSI near the overbought territory suggest an advantage to the bulls. If the bulls can push and sustain the bitcoin value above $20,000, the next leg of the uptrend to $25,000 could begin.
Conversely, if the bulls fail to sustain the price above $20,000, the pair may consolidate in a range for a few days before starting the next trending move.
The trend will turn in favour of the bears if the price turns down and plummets below $16,000.
We believe that the risk to reward ratio is not attractive. Hence, we will wait for the price to correct, stabilise, and form a bottom before proposing a trade.
ETHEREUM TRADING – HOW TO TRADE ETH/USD
Traders who had followed the recommendation to book profits near $621 given in the previous analysis would have avoided the sharp fall on November 25 and 26.
Although Ethereum trading broke below the 20-day EMA, the bears could not sustain the lower levels. The fall to $488.95 gave an opportunity to the traders to buy as the risk to reward ratio was favorable.
The ETH/USD pair picked up momentum on November 28 and surged to $617 on November 30.
Currently, the bears are attempting to defend the $625 level but if the bulls do not give up much ground, it will increase the possibility of a break out of the overhead resistance.
If successful, the biggest altcoin could start its journey to $800. The rising moving averages and the RSI near the overbought zone suggest an advantage to the bulls.
Contrary to this assumption, if the bears sink the price below $565, the pair could enter a range-bound action for a few days.
Aggressive traders could buy if the price sustains above $625 for a few hours. This is a risky trade, hence, a close stop-loss can be used. Positional traders can remain on the sidelines and wait for the next low-risk buying opportunity.
XRP TRADING – HOW TO TRADE XRP/USD
We again got this trade and the level of the correction right in the previous analysis. XRP trading plunged sharply on November 26 and declined to an intraday low at $0.45961, but the lower levels attracted buying and the altcoin closed at $0.53823.
On November 27, the bulls again defended the dip to the psychological support at $0.50. The bears are currently attempting to stall the relief rally at the 61.8% Fibonacci retracement level at $0.65761.
If the XRP trading turns down from the current levels, the XRP/USD pair could drop to $0.50 and remain range-bound for a few days.
But if the bulls can push the XRP trading above $0.68, a retest of $0.78 will be on the cards. The upsloping moving averages and the RSI in the overbought zone suggest an advantage to the bulls.
This positive view will be invalidated if the pair turns down sharply from the current levels and sustains below $0.50. Such a move could suggest bears are back in the game.
We do not find any reliable trading setups at the current levels; hence, we are not suggesting a trade in it.
BITCOIN CASH TRADING – HOW TO TRADE BCH/USD
The bulls pushed the price above $350 on November 24 and 25 but could not sustain the higher levels. This gave an opportunity to traders to book profits as suggested in the previous analysis.
Bitcoin Cash trading turned down sharply on November 25 and 26 and plunged to a low of $251.59, much below our expectation of $300.
The buyers again purchased at lower levels and pushed the price above $280 on November 29. This attracted strong buying by the bulls and the BCH/USD pair surged to $322.78 on November 30.
The bears are likely to defend the $326.73 to $350 overhead resistance zone. If the price turns down from this zone, Bitcoin Cash trading could remain range-bound for a few days before starting the next trending move.
On the downside, a drop below $280 will suggest an advantage to the bears while a break above $350 will open the doors for a rally to $500. We do not find any reliable buy setups at the current levels; hence, we are not recommending a trade in it.
CHAINLINK TRADING – HOW TO TRADE LINK/USD
Chainlink trading turned down from $16.42 on November 24 and fell to a low of $11.28 on November 26. This fall would have hit the stop-loss of the traders that were kept at breakeven according to our suggestion given in the previous analysis.
The bulls purchased the low below the 50-day SMA and have again pushed the price above the $13.40 overhead resistance. The RSI above 56 suggests that the bulls are attempting to make a comeback.
If the bulls can sustain the price above $13.40, a retest of $16.42 is possible. A break above this resistance could carry the LINK/USD pair to $18 and then to $19.50.
On the other hand, if the price turns down from $16.42, the pair may remain range-bound for a few days. A break below $11.28 will tilt the advantage in favour of the bears.
We do not find any reliable buy signal at the current levels; hence, we are not suggesting a trade in it.
Hopefully, you have enjoyed today’s article.
Thanks for reading! Have a fantastic day! Live from the Platinum Crypto Trading Floor.
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