The cryptocurrencies, which plunged after repeated talks of a bubble and the Chinese crackdown on ICOs are on their way up again. So, will the rally in the digital currencies pick up momentum or will they remain range bound for a few weeks? Should traders who were waiting for lower levels throw in the towel and buy at the current levels or wait?
Let’s see BTC/USD the charts and try to find out. ( 02 Oktober 2017 )
BTC/USD
The pullback in bitcoin is nearing $4546 levels, which is the 78.6% Fibonacci retracement of the fall from $4975 to $2974. The pullback from the lows has been gradual but strong. Numerous attempts by the bears to sink the digital currency have failed.
However, we expect some resistance between $4546 and $4680 levels. If this resistance zone is crossed, the cryptocurrency will retest the highs once again.
Traders who are long from lower levels should book partial profits if they find bitcoin struggling to breakout of the above-mentioned resistance zone.
For the traders who have not initiated long positions, waiting for lower levels, now is not the right time to do so. The risk to reward ratio at the current levels is not attractive. Therefore, they should wait for a pullback to about $4200 or lower to initiate long positions. On a fall, the digital currency has strong support at $4000 and $3500 levels.
