Bitcoin

$16,000: Bitcoin Looks North As Ripple Takes Hit

Bitcoin is gaining altitude today, amid a sharp drop in prices of some alternative currencies.

Prices on CoinDesk’s Bitcoin Price Index jumped 7 percent to an intraday high of $16,181 in the last two hours. The cryptocurrency has appreciated by 10 percent in the last 24 hours, according to data source CoinMarketCap.

Meanwhile, Ripple’s XRP token has depreciated by 9 percent in the last 24 hours, having soared to new heights on Jan. 3.

$16,000: Bitcoin Looks North As Ripple Takes Hit
$16,000: Bitcoin Looks North As Ripple Takes Hit

Other alternative currencies like NEM (XEM), Cardano (ADA) and Stellar (STR) are down at least 12 percent each. More importantly, the XRP/BTC (ripple-bitcoin) pair has taken a beating in the last couple of hours. XEM/BTC, ADA/BTC, ETH/BTC (ethereum-bitcoin) and LTC/BTC (litecoin-bitcoin) are also losing altitude.

So, bitcoin (BTC) seems to have caught a bid wave at $14,848.10 (07:29 UTC), tracking the weakness in the cross cryptocurrency pairs (ETH/BTC, LTC/BTC, XRP/BTC) – that is, money made from the altcoin rally is likely being channeled back into BTC.

Price chart analysis also suggests BTC could extend the rally to $18,000-$18,600 in the short-run.

4-hour chart

The above chart (prices as per Coinbase) shows:

  • An inverse head and shoulder breakout. As of writing, BTC is trading well above the neckline hurdle of $15,550, so the bullish breakout is pretty much a done deal. Prices could rise to $18,600 (target as per the measured height method) over the weekend.
  • Other factors – including a breach of the falling trendline, a bullish break of the falling wedge, higher lows as represented by the rising trendline – also favor further upside in BTC.
  • The relative strength index (RSI) is above 50.00 (in the bullish territory) and rising, indicating scope for a rally in prices.

View

  • BTC could cut through resistance at $16,490 and move towards $18,000–18,600 mark over the weekend.
  • Bearish scenario: A failure to hold above the neckline support (former resistance) of $15,500 followed by a break below $14,230 today would open the doors for a drop to sub-$12,500 levels.

Arrows image via Shutterstock

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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Please conduct your own thorough research before investing in any cryptocurrency.

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