Now that the benchmark blockchain asset has completed its halving, the narrative surrounding cryptos has become even more intriguing. At a fundamental level, the original virtual currency was supposed to rise based on a simple equation: less supply, more demand. However, the blockchain ecosystem is rarely this simple.
Certainly the upward trend seems to be at its strongest since then. Cryptos don’t rise just because of a single event in a particular decentralized digital asset. Rather, more and more mainstream investors – especially institutional ones – are recognizing the opportunities offered by virtual currencies. With exchange-traded funds covering this space, crypto adoption is at an all-time high.
On the other hand, the bearish case is worth considering The block recently pointed out. In particular, Mining companies are facing new challenges due to the reduced supply of original cryptocurrencies. Many could simply go out of business. If that happens, we would see reduced network participation and open the door to an entity controlling most of the network: the dreaded 51 percent attack.
It’s unlikely that this will happen, but the probability is not zero. With this in mind, you should be careful in your decision making. Here are seven cryptos to keep an eye on.
Bitcoin (BTC USD)
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With Bitcoin (BTC USD) completes its halving, the benchmark blockchain asset is trading at just under $67,000 late Monday evening. The unrest isn’t particularly surprising, considering the age-old adage: Buy the rumor, sell the news. BTC has undoubtedly performed well. However, it is also noticeable that it is below that Record price of nearly $74,000.
The question now is, where will Bitcoin go next? To put it bluntly: I don’t like the current technical stance. Previously, I explained that BTC appears to be forming a bullish pennant formation. However, the development of this pattern appeared to break down starting around April 12th. The pronounced decline on April 17th makes it difficult to determine whether a legitimate pattern exists.
At the same time, it is noteworthy that Bitcoin has struggled to break above its 50-day moving average. The acquisition volume has also been declining since the end of February. With geopolitical uncertainty clouding the bigger picture, it may be best to limit exposure somewhat.
I am not suggesting selling BTC completely. However, it may be advisable to take some of your previous winnings so that you have something in your pocket.
Ethereum (ETH-USD)
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While cryptos were focused on Bitcoin and its halving, ether (ETH-USD) is the second most valuable digital asset with relevance. In the short term and without larger context, ETH looks good. In the last 24 hours, the crypto coin has gained over 2% of market value. It has risen almost 5% in the last seven days.
Still, Ethereum was disappointing overall. There is no other way to put it. At the beginning of last month, ETH units were trading at over $4,000. However, this high status did not last long. However, with the base price hovering around $3,500, there was hope that the bulls could push ahead.
Previously I explained that ETH appears to be printing an ugly bullish pennant. However, the sharp decline of the April 12 session and the subsequent weak reaction call this thesis into question. Based on data from StockCharts, it appears that acquisition volume has declined since January of this year.
Given the weakness of cryptos, I would consider reducing some exposure to strength. Ethereum’s inability to decisively overcome its 20-day exponential moving average only reinforces skepticism.
Tether (USDT-USD)
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At the moment the benchmark stablecoin Connection (USDT-USD) trades in perfect parity with the dollar. So there is no real signal one way or another about the overall health of cryptos. Still, it is noteworthy that over the past seven days, most of USDT’s price action occurred above the parity line. Consequently, it appears that traders trust virtual currencies over fiat currencies.
This is a positive development for blockchain advocates. However, it remains to be seen whether the momentum will continue. What stands out – in a not-so-encouraging way – is that USDT has fallen well below its one-to-one peg to the greenback over the past week; the first on March 27th and the second on April 12th.
Looking ahead, circumstances do not seem to bode well for Tether. Accordingly On-chain signals According to TipRanks, the consensus for USDT is mostly bearish. When it comes to the key metrics of net network growth, volume of profitable traders, concentration of large holders and number of large transactions, all statistics are pessimistic.
Translation? Investors should be vigilant when it comes to cryptos and take profits when it makes sense.
BNB (BNB-USD)
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While the virtual currency ecosystem faces uncertainty, BNB (BNB-USD) represents one of the rarer cryptos that looks somewhat appealing. In the last seven days, BNB has gained over 10% of market value. That could increase confidence in other blockchain assets, although it’s still best to be cautious.
From March 6th to April 10th, BNB seemed to draw a bullish pennant pattern of all kinds. However, similar to other cryptos, the digital asset stumbled in the following session. By April 17, it fell to an intraday low of $513.93, effectively breaking the pennant shape. Normally that would be pessimistic. However, a rebound from April 18 could be an attempt to save the rally.
What makes BNB all the more attractive is that it is trading above key technical benchmarks such as the 20-day exponential moving average, the 50-day moving average, and the 200-day moving average. As long as bulls continue to support the decentralized asset, it has a chance of marching further north.
Still, I’m not particularly thrilled with the decline in acquisition volume since the March 13 meeting. So even with BNB I wouldn’t mind shortening the exposure a bit.
Solana (SOL-USD)
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One of the hottest cryptos not called Bitcoin, Solana (SOL USD) has lost some of its former sharpness. However, in the short term, the bulls are trying to patch things up. In the last 24 hours, SOL is up 4%. It is up more than 15% in the last seven days. That’s the good news. But believe it or not, there is some bad news associated with this rally.
I don’t want to disparage, but when viewed in a broader context, SOL’s jump upwards is more emblematic of a “desperation move.” You see, since the April 12th session, significant volatility has pushed the price worryingly lower. On April 17, the asset fell to an intraday low of $126.91 before rising again. Unfortunately, its 20-day exponential moving average appears to be acting as upside resistance.
Even if Solana manages to clear this barrier, the 50-day moving average – at $167.57 – will likely frustrate bulls. Overall, Solana’s price action (or chart behavior, if you will) appears to be broken. Ideally, bulls need to push the price back to $175 quickly to avoid further damage.
It could happen – it just wouldn’t be a bad idea to take profits here.
XRP (XRP-USD)
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A frustrating digital asset, XRP (XRP USD) continues to confuse stakeholders. Previously, XRP appeared to be getting its chart pattern back on track with rising lows following a major disruption earlier this year. Unfortunately, the token once again suffered a severe bout of volatility, this time on April 12th. The next day, XRP fell to an intraday low of 43.1 cents before bulls attempted a recovery.
That’s the context behind the strong near-term performance. In the last 24 hours, XRP has gained almost 3% in market value. In the last week it has risen almost 13%. Taken on their own, they sound like amazing statistics. Unfortunately, as previously mentioned, the price action reflects more of a desperation reaction than anything else.
Now the good news is that XRP is trading above its 20-day exponential moving average. However, it is still below its 200-DMA (58 cents) and 50-DMA (60 cents). Frankly, I’m worried about XRP. If the bullish sentiment in other cryptos fails, XRP could be in trouble. Watch this area carefully and be prepared to reduce some of your inventory.
Dogecoin (DOGE-USD)
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In what could be the ultimate Rorschach test, Dogecoin (DOGE-USD) could hint at where cryptos could go next. Looking at the chart pattern from late February to today, there seem to be two possible interpretations. Let’s start with the negative first.
From a pessimistic perspective, DOGE could draw a broken head and shoulders pattern. The two shoulders could be represented by the Pops, which peak on March 11th and April 20th. Additionally, the head could be represented by the top-line price observed during the March 28th and 31st sessions. As you probably know, head and shoulders mean a negative result.
On the other hand, the uptrend between February 26th and March 4th could be a red flag. The subsequent trading could be a period of consolidation. Once the consolidation is complete, XRP could potentially skyrocket.
However, if the optimistic outlook materializes, it would have to happen fairly soon. In addition, the acquisition volume would have to be robust. Otherwise the pop could be a head fake. Given the skepticism in global markets, it might make more sense to take a conservative approach.
At the time of publication: Josh Enomoto held a LONG position in BTC, ETH, USDT and XRP. The opinions expressed in this article are those of the author, subject to those of InvestorPlace.com Publishing Guidelines.
