After a week of bullish momentum, Bitcoin (BTC) and Ether (ETH) are back testing their respective supports. Will the major crypto-currencies manage to get back on track towards their bullish targets?
Bitcoin has finally triggered its bullish signal
The Bitcoin (BTC) price has been moving horizontally in a daily triangle for several weeks. In our previous analysis, we observed that the compression was reducing and that the price was about to enter a strong movement in the direction of the breakout of the pattern.
The Bitcoin Daily Chart
So this week, Bitcoin finally broke its triangle from above, activating a target at $55,832. This is the height of the pattern at its entry, carried over to the breakout point. In the next few days, we should therefore see the price back on this target well above $50,000.
Despite a nice bullish momentum triggered at the breakout, the price is currently performing a pullback on the top of its triangle, i.e. a test of the former resistance which should now act as support. The setup on Ichimoku really shows a possibility for the price to bounce back, as the Tenkan, Kijun and cloud are important support levels, which could help the price to move back up.
In the event that the price nevertheless breaks back below the cloud at $39,000, there is a risk that the price could move back towards the $31,350 triangle breakout target from below.
Ether continues to rise
Following the breakout of the triangle that has been in place for several weeks, the price of Ether (ETH) is likely to move back towards $4,571.
Ether (ETH) Daily chart
As with Bitcoin, we had observed that the price of Ether was evolving within a compression triangle and we had therefore anticipated the high volatility that followed.
Thus, the target for the breakout of the triangle at $3,768 is still in place and following the breakout of the range this week, the target can be extended to $4,571 (corresponding to the height of the range, carried forward to its exit).
If despite this bullish signal the ETH fails to hold its Kijun support at $2,900, there will be a strong risk of the price returning to $2,500 or even to the bottom of the range at $2,200.
In conclusion
Crypto-currencies are enjoying nice bullish setups to continue their momentum. However, the price is in pullback and will need to hold its important supports to reach its targets.
