Bitcoin Continues Surges to Over $8000! Are Bitcoin Cash and Litecoin Reaching New Highs? (BTC, LTC, BCH Trade Setups: May 15)

On May 12, the price reached a high of $7448. It continued to increase and on May 14 it reached a high of $8194.1 Similarly, the RSI made the first high on May 12. However, it has continued to generate lower values since. This is known as bearish divergence and often precedes price decreases. On May 14, the price began a decrease and reached the support line of the channel. Using these indicators, we are unable to predict whether a breakdown is likely. While we currently believe, it is unlikely that the price will break out above the resistance at $8300-$8500, the sudden and rapid surges lately may prove us wrong. At the current time, we do not see any profitable trade setups for BTC. If the price reaches the upper limit of our resistance range, we will analyze a possible short setup. Now, let’s take a look at LTC/USD:

Litecoin’s Triangle

In order to figure out the future movement of the price, we will analyze the price of LTC at six-hour intervals alongside the RSI in the graph below: On May 11, the price reached a high of $94.5. It continued to increase and reached a higher high of $96 on May 15. Similarly, the RSI  reached a high on May 11. However, it has proceeded to generate lower values since. This is known as bearish divergence and often precedes price decreases. The use of these indicators makes it likely that the price will decrease towards the support line of the triangle. Since the price is trading very close to the resistance line of the triangle, we will examine a possible short trade setup.

Short Trade Setup

We will examine a possible short trade setup with an average entry of $95. The stop-loss order is placed at $101, slightly above the Apr 3 high. The value of $101 is also chosen since we believe that $100 can offer psychological resistance. This is a stop loss of roughly 5%.

Our target would be $80, slightly above the support line of the triangle.

Combined with the stop loss mentioned above, this is a risk to reward ratio of 3:1.

A breakdown is not needed to reach the target. Rather, only a decrease within the channel is required. Based on our analysis of technical indicators, this is likely.

Furthermore, this is a good entry point for a long-term trade. Until the price reaches our target, we may be able to generate other short-term trade setups. In future analyses, we will attempt to see if this is possible. Finally, let’s take a look at BCH/USD:

An Ascending Channel For Bitcoin Cash

In the case of BCH, the daily long-term pattern can be used to predict future movement. Therefore, we have outlined the daily price of BCH/USD from Dec 2018 to May 2019 alongside the RSI and the MACD below: On Apr 3, the price reached a high of $354.27. It continued to increase and reached a higher high of $410.92 on May 14. Similarly, the RSI and the MACD made a high on Apr 3. However, they have continued to generate lower values since. This is known as bearish divergence and often precedes price decreases. The use of these indicators suggests that the price will decrease towards the support line of the channel. Due to the fact that the price is trading very close to the resistance line of the channel, we will analyze a possible short trade setup below:

Short Trade Setup

We will examine a possible short trade setup with an average entry of $390. The stop-loss order is placed at $421, slightly above the May 12 high. This is a stop loss of roughly 8%.

Our target is $195, slightly above the support line of the channel.

Combined with the stop loss mentioned above, this is a risk to reward ratio of 6:1.

A breakdown is not needed to reach the target. Rather, only a decrease within the channel is required. Based on our analysis of technical indicators, this appears likely.

Furthermore, this is a long-term trade setup. We believe other trade setups will present themselves before the price reaches our target.

Conclusion

To conclude, Litecoin and Bitcoin Cash are both following ascending support lines. Litecoin is trading inside a bullish ascending triangle, while BCH is trading inside a neutral ascending channel.

Bitcoin recently broke out of its trading pattern and is not currently following a trading structure, though a new trading pattern may be forming.

Furthermore, both Bitcoin and Bitcoin Cash have developed bearish divergence in long timeframes while Litecoin has only done so in medium timeframes.

To conclude, we believe that Bitcoin faces the best prospects for the near future, due to the fact that it has not generated any bearish divergence and is trading very close to the support line of its pattern.

Conversely, LTC and BCH are trading very close to their respective resistances.

Bitcoin Cash has the most profitable trade setup in place, with a risk to reward ratio of 6:1.

A summary is presented in the table below:

	BTC	LTC Sponsored Sponsored	BCH	WINNER
Long-term Pattern	Ascending Channel Breakout	Ascending triangle	Ascending Channel	LTC Sponsored Sponsored
Short-Term Patterns & Indicators	Slight bearish divergence in a neutral pattern	Bearish divergence in a bullish pattern	Long-term bearish divergence developing	BTC
Trade Setup	None	Short trade with 3:1 risk to reward ratio	Short trade with 4:1 risk to reward ratio	BCH

Do you think the price of Litecoin will begin to decrease? What about BTC? Where will the price of BCH go? Let us know in the comments below. 

Disclaimer: This article is not trading advice and should not be construed as such. Always consult a trained financial professional before investing in cryptocurrencies, as the market is particularly volatile.