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Cryptos consolidate before breaking out in 2022

Cryptos consolidate before breaking out in 2022
Written by publisher team

  • Bitcoin price continues to trade in a range that has continued throughout the month of December.
  • Ethereum price is waiting to enter an explosive move up.
  • The price of XRP is starting to cause a short squeeze, likely to drive the major coins in early 2022.

Bitcoin price recently caused a long-term theoretical entry; This indicates that the upside potential is still strong. Ethereum price put up over 50%. XRP price is still under pressure from both technical and fundamental factors – but that is about to change.

Bitcoin Price Continues To Crowd, Breakout Soon

Bitcoin price action has been stuck between the $46,000 and $50,000 value areas for the entire month of December. While the daily candlestick chart shows a downside continuation setup in the form of a bear flag, the dot and figure chart shows something a bit different.

More recent analysis has identified a pole pattern on the Bitcoin reversal point and figure chart at $500/3 squares. The theoretical long setup for the bitcoin price was a buy stop on a 3-box reversal, which resulted in $48,500. The stop loss is 4 stop boxes, currently at $46,500, and the profit target is $63,000. The default trade setup is a 7.25:1 reward for the risk setup, with an implied profit target of 30.5% above the entry level.

The trade setup is still in effect as Bitcoin is back below the entry level, allowing traders to enter a new position they lost or add to an existing long position. New positions should use a two to three box trailing stop to protect any profit made after the entry is started.

BTC / USD $500 / 3-box Reversal Point & Figure Chart

The downside risks to the bitcoin price remain. This time of year is famous for swings and binaries in price action. Watch for any movement below the $46,000 value area, which could lead to a quick crash into the lower $30,000 price range.

Ethereum price set to reach $6000

Ethereum price is waiting for a clear breakout to reach a critical entry area set on December 30th. The default trade setting is still valid.

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 5:1 risk to reward and 52% implied gain from 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 is developing a bullish reversal pattern, trapping short sellers

XRP’s price action, more so than Bitcoin or Ethereum, will give weak hands and cash. The spike pattern completed recently on the $0.01/3-squares reversal chart in XRP. The requirement to enter the spike pattern is simple: a three-box reversal.

A possible long setup for the XRP price is the buy stop at $0.85, the stop loss at $0.81 and the profit target at $1.10. This trade represents a 6.25:1 reward on risk with an implied 30% profit from the entry. A trailing stop loss of two to three boxes will help protect any implied profits made after entering.

XRP / USDT Reversal Point & Figure Chart 0.01 / 3 Boxes

Traders should expect resistance at the $1.00 value area and be prepared for the momentum to take in XRP price through $1.00 as it was heavily tested during December.

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