Crypto market forms multiple bear traps, bullish reversals incoming

  • Bitcoin price continues to accumulate between $45,000 and $48,000.
  • Ethereum price continues to offer a rare bullish reversal buying opportunity before reaching the $6000 value area.
  • XRP price could gain more than 77% if it could reclaim the $1 value area.

Bitcoin price is seeing an increase in buying volume, creating a strong support zone for the future. Ethereum price action is waiting for buyers to unleash one of the most powerful and desirable pips and patterns entry patterns. XRP price continues to move near its final support areas, but a bullish breakout may be imminent.

Bitcoin price action indicates bearish bias despite buyers taking control

Bitcoin price action, from an Ichimoku perspective, is largely bearish. The current close is lower than Tenkan-Sen, Kijun-Sen and Cloud (Senkou Span A, Senkou Span B). The highlighted red area on the chart image below represents the price level or breakout of bitcoin since late November 2021.

The red area identifies two levels in the current volume profile where bitcoin is weakest. Below the $48,000 value area, Bitcoin is in high risk of a rapid crash towards the next high volume node at $37,000. The bitcoin price has been tempted to crash for more than a month, however, the bears are still unable or unwilling to push bitcoin into a sell-off.

BTC/USD Ichimoku Daily Chart

The most likely explanation is that a bear trap is developing on the daily chart which can be confirmed if Bitcoin is to make a daily close above Tenkan-Sen and Kijun-Sen at or above the $49,000 value area. In this scenario, a large number of leveraged short positions will begin to liquidate, potentially crowding bitcoin into the unregulated derivatives markets with some of that momentum seeping into the spot market.

Ethereum price set for an explosive lead of 50%

Ethereum price is showing the development of a strong bullish reversal pattern in Point and Figure analysis known as Bullish Shakeout. However, this pattern is only valid if the instrument is in a broader uptrend, and the entry should occur near the start of a bullish continuation movement. In other words, the bullish tremor allows traders to enter into one of the closest opportunities after the corrective move.

The importance of this default buy setting lies not only in the pattern itself, but also in the other two events that collide if the entry starts. First, the entry will confirm a break above the triple top. Second, the entry will turn the Ethereum price action into a bullish market on the chart of the reversal point and figure 100/3-box.

The default entry for the Ethereum price is a buy stop order at $4,000, a stop loss at $3,500, and a profit target at $6,000. This trade represents a 5:1 risk/reward ratio and an implied gain of 52% from the entry. A trailing two to three box trailing stop will help protect any potential profit after the entry has started.

ETH/USD 100/3-box Reversal Point and Figure Chart

This trade setup is invalidated if the Ethereum price moves to $3,300. Ethereum is likely to see a bearish setup to target the $2800 area in this scenario.

XRP price shrinks against key Fibonacci and Ichimoku levels; Hacking may happen soon

XRP price remains confined within a range of critical Fibonacci and Ichimoku levels. Between the $0.82 and $0.89 price range, there are Tenkan-Sen, Kijun-Sen, Senkou Span A, 38.2% Fibonacci retracement and 100% Fibonacci. No wonder then that XRP struggled to make any progress in the $0.90 price range.

Despite this, XRP could cause a massive bullish explosion soon. The Optex Bands oscillator, RSI, and composite indicator are all perfectly positioned to confirm any major upward push through XRP price – and that such a move can continue. The main oscillator to watch is the composite indicator. If the composite index crosses its moving averages, XRP will likely be positioned near the $1.00 price level.

XRP / USD Ichimoku Daily Chart

Ultimately, XRP price needs to close at or above $1.00 to ensure that XRP is in a clear and undeniable uptrend. Failure to maintain the $0.80 support area could lead to a massive decline towards the $0.50 area.

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