Crypto Update: Altcoins Spike Lower as Bitcoin Fails at Resistance

The major cryptocurrencies are having a decisively bearish session, as following a long period of quiet trading, the segment experienced a high-volume sell-off in early US trading. In the past few days, Bitcoin showed signs of relative strength, while Ethereum and Ripple remained neutral from a short-term perspective, and today, in line with the recent trends, the biggest altcoins are leading the way lower.

The broad-based dip dragged the relatively stronger coins lower as well, and on a negative note, the leaders of the February counter-trend move, such as EOS and LTC are now or among the weaker digital currencies. With that in mind, our trend model remains clearly on sell signals on both time-frames with regards to the majority of the coins, even as today’s dip didn’t carry the coins below key support levels.

EOS/USD, 4-Hour Chart Analysis

The counter-trend move might still resume, especially should BTC retain its relative strength, but the weakness of ETH and XRP remains a huge concern for bulls here, especially in light of the long-term trends. For now, traders should still lonely consider positions in the strongest coins, and they should continue to apply strict risk management rules.

LTC/USD, 4-Hour Chart Analysis

Litecoin pulled back today together with the broader market, but we haven’t seen the spike in volume that has been visible across the board. Volatility remains muted in LTC’s market, and the coin is still clearly within its rising short-term trend.

That said, the momentum of Litecoin’s advance is weakening, and although our trend model is still on a short-term buy signal, a deeper correction wouldn’t be surprising here, and that could lead to the resumption of the long-term bear market in the coming weeks. Primary support is found near $56, with further zones near $51, $48, and $44, while the next major resistance zone is ahead near $64.

ETH/USD, 4-Hour Chart

After failing to reach the $145 level during the late-week rally, Ethereum spiked lower towards the $130 level today, but for now, it remains stuck between the two key price levels, despite its relative weakness. ETH remains in a hostile long-term technical setup, and given the weakness we saw in recent days, traders should still stay away from the coin.

Should Ethereum dip sustainably below $130, the whole segment could be in trouble, as the broader market has been closely correlated with ETH’s performance for several months now. Below the $130 level, further support is found near $112 and between $95 and $100, while resistance is ahead at $160 and $180.

Ripple Hits Two-Week Low Amid Sell-Off

BTC/USD, 4-Hour Chart Analysis

Bitcoin managed to climb above the $4000 level before today’s broad-based dip, and the coin tested the upper boundary of the key long-term $4000-$4050 resistance zone before turning lower. As the coin failed to break-out above the primary zone, our trend model is still on sell signals on both time-frames.

Despite today’s sell-off, BTC is still showing relative strength, and that still gives bulls hope that the segment will recover and the counter-trend move that started in February will resume. The coin is still well clear of the $3850 support level, and further strong levels are also found near $3600, $3450, and $3250, while above the primary zone, another strong resistance zone is found near $4450.

XRP/USDT, 4-Hour Chart Analysis

Ripple had its most volatile day in a long while today, and it broke below the $0.31 level, getting close to the key long-term $0.30 level, hitting a new two-week low in the process. The coin still hasn’t broken down despite drifting out of its long-standing triangle consolidation pattern, but given the clearly bearish long-term setup, a sustained bullish move would be surprising here.

Below the initial $0.30 zone, further support levels are found near $0.28, and $0.26, while above the primary $0.32 level, further key resistance levels are ahead near $0.3550, and $0.3750, and our trend model remains on sell signals on both time-frames.

Featured image from Shutterstock

Disclaimer:  The analyst owns cryptocurrencies. He holds investment positions in the coins, but doesn’t engage in short-term or day-trading, nor does he hold short positions on any of the coins.

Author:
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.