Today we continue to talk about our experiment with rebalancing a portfolio from the Top-5 cryptocurrencies
Last week, its value set a new all-time high at $19,922. This was the fifth week in a row during which our portfolio increased by 46%. Let’s see if this trend has continued this week:
Unfortunately, this time our portfolio has decreased by $1,300, or 6.46%. However, we have to admit that this was to be expected, because the last strong decline in the portfolio took place already 3 months ago! At that time, it fell by 8% and after that we saw an increase of almost 100%.
This time, absolutely all assets from our portfolio showed negative dynamics. The worst drop among them was in Litecoin, which lost 14% in a week. We expected such a development of events and everything happened exactly according to our plan. The only inaccuracy was that we expected to see LTC at $65, but it reached $72. Now the price is moving along the uptrend, if it breaks down and consolidates below $72 on the daily timeframe, we will see a new fall in the asset price.
CRPT fell 9% this time and broke through the resistance at $0.20. For the last 2 weeks, the asset has been in the accumulation zone and is preparing for a reversal. Perhaps in the next week we can see a significant increase in the value of the asset. If it doesn’t, CRPT will be in the $0.18 — $0.20 range.
Next came XRP, which fell 8.58%. Last time we assumed a decline in the chart of this asset to $0.50 and this happened a few days later. Our prediction turned out to be correct. XRP is in a descending triangle and we expect a new decline towards the $0.50 level. Here the asset can stop and gain strength to break down.
Ethereum lost 5.37% in a week. After the launch of Ethereum 2.0 on December 1st, the price has been gradually decreasing and dropped from $635 to $560. The price may decline to $520 and if it consolidates below, we may see a strong decline to the $480 level. So far, Ethereum has been completely following Bitcoin and repeating its structure. If Bitcoin goes up, then Ethereum is likely to follow it.
Bitcoin lost the least this week — 3.62%. So far, the situation is not critical and Bitcoin is in an ascending triangle. However, some indicators and moving averages are starting to indicate a possible trend reversal. This scenario will be relevant if the price fixes below $17,000 on the daily timeframe. In this case, the likelihood of a transition to a long downtrend is high. However, most likely in the coming week, we will see another leap to $20,000. If Bitcoin is able to break through this level, then the price will go up by tens of percent.
Despite such strong declines in various assets in our portfolio, we will not rebalance, since all shares are within the acceptable range.
The coming week will show whether Bitcoin can break through $20,000 and literally everything on the crypto market will depend on it.