Analysis: Bitcoin Price Crashes Below $3400, Ethereum Plunges to $225

The sky has fallen today in the cryptocurrency segment, as China took huge steps towards closing its domestic Bitcoin exchanges, in line with the recently surfaced rumors. The whole sector took a major beating on the confirmation, with Bitcoin and Ethereum leading the way lower. ETH, which is slightly more exposed to the Chinese crackdown on ICOs and existing coins, was slammed below the crucial $235 support, and our primary target for the correction, and the bleeding still hasn’t stopped.

The coin is approaching oversold territory after the 40% decline, so long-term investors should already be looking for buying opportunities, as today’s panicky conditions could soon lead to a durable bottom. That said, as volatility is expected to remain high, and more short-term decline is definitely in the cards.

ETH/USD, 4-Hour Chart Analysis

The other majors are also sharply lower today, with only IOTA, Monero, and Ripple showing signs of relative strength. Litecoin and Ethereum Classic are among the weakest large coins, with losses of almost 20%, while the rest of the market is down by an average of 10%. With no more of top 10 currencies being overbought, the correction could be in its latter stages, and a short-term trend change could be the beginning of a tradable rally. Let’s see how the charts look after the crash.


BTC/USD, 4-Hour Chart Analysis

After reaching the $3800 level earlier this week, the largest coin slumped below the next major support level at $3500 during today’s bloodbath, and also touched the 50% Fibonacci retracement in the process. BTC is clearly oversold regarding the short-term picture and the long-term setup is also back to neutral. Below $3500 the $3150 level serves as primary support, with the prior all-time also near that level at $3000.


LTC/USD, 4-Hour Chart Analysis

Litecoin hit our final target for the correction near $51 today, and in order to keep the rising trend intact, it shouldn’t stay below $50 durably. The coin cleared the long-term overbought readings with the plunge, and the current levels could already be attractive from an investment standpoint. That said, short-term traders should wait until a trend change with opening new positions. Support is now found at $47, while resistance is ahead at $56, and $64.


DASH/USD, 4-Hour Chart Analysis

Dash reached the $265 support that we have been monitoring as a target for the move, and the coin is getting close to clearing the long-term overbought condition. A dip to the prior high near $220 is still possible as the broad correction concludes, but the currency is getting close to, at least, a short-term bottom, with resistance ahead near $300.


XRP/USD, 4-Hour Chart Analysis

XRP is trading just above the long-term base formation around the $15 level, and the coin should remain above $16 to maintain the break-out of the pattern. Ripple has been holding up relatively well during the current move, and we still expect the coin to outperform the segment in the next leg higher. Support is now found at $0.16, while resistance is ahead at $0.18, around the $0.20 level, and near $0.22.

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

Ethereum Classic plunged below key support near $13.50 today, and should the coin stay below that level, the long-term trend could turn negative. The current levels still look attractive for long-term investors, but more volatility is likely and a quick recovery would be needed to avoid a technical sell signal.


XMR/USD, 4-Hour Chart Analysis

Monero remains the strongest major regarding the short-term picture, holding up well amid the immense selling pressure. The coin dipped below the $100 level as we expected, but it is still well clear of the next major support at $80.With the long-term momentum nearing neutral territory, the correction might soon be over in XMR. Resistance is still ahead at $125, and near the all-time high above $150, while further support is found at $68.


NEO/USDT, 4-Hour Chart Analysis

NEO crashed below the $16.50 support after the confirmation of the Chinese ban, and the coin remains under severe selling pressure, still being in the epicenter of the decline.  Volatility is expected to remain elevated, and despite the attractive price levels more short-term losses are possible, so traders should with opening new positions. Crucial resistance levels are ahead at $22, $25, and $30, while support is a found at $13, and $11.


IOTA/USD, 4-Hour Chart Analysis

IOTA is till testing the strong support zone between the $0.45 and $0.48 levels, showing short-term relative strength in the face of the crashing prices. The declining trend remains dominant in the coin, but the oversold long-term momentum readings and the technical strength are encouraging from an investment standpoint, and investors could already add to their positions on the short –term dips. Strong resistance is ahead near $0.65, with support at $0.35.

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Trader and financial analyst, with 10 years of experience in the field. An expert in technical analysis and risk management, but also an avid practitioner of value investment and passive strategies, with a passion towards anything that is connected to the market.