Crypto Update: Bearish Drift Continues in Crypto-Land

Trading activity remained low in the cryptocurrency segment following the mixed weekend, and although the top coins continue to be stuck in bearish technical setups, bulls avoided a move below the key short-term support levels. That said, none of the majors managed to show bullish momentum or technical progress in the quiet environment, and we haven’t seen major resistance levels fall, which would indicate buying pressure.

Until a move out of the narrow short-term ranges, trading volumes will likely remain very low, especially in light of the Chinese holidays, but despite the low volatility, traders should be aware of the risks that are still clearly skewed to the downside. Even the relatively stronger coins will likely get dragged lower by the broader market in the case of break-down, and without a stable bullish leadership, the odds of a sustained rally are low in the segment.

LTC/USD, 4-Hour Chart Analysis

Litecoin continues to show relative strength in the quiet market, but for now, the coin failed to recapture the key $34.50 level, so the technical setup in the coin remains unchanged, with our trend model still being on sell signals on both time-frames. A sustained move above the primary level would signal a short-term trend change, but given the segment-wide trends and the negative long-term setup, odds still favor a negative outcome even for LTC.

The key support zone found between $30 and $30.50 is in no immediate danger, but in case of a bearish move in the segment, a quick dip towards the $26 level is possible, and from a broader perspective a test of the bear market low near $23 is still likely, with further strong resistance still being found near $38.

BTC/USD, 4-Hour Chart Analysis

Bitcoin has been drifting sideways since the failed rally attempt during the weekend, and although it remains well above last week’s swing low, it remains stuck below its prior trading range and our trend model is still on sell signals on both time-frames. The primary resistance zone just above $3450 remains in focus, but even in the case of a spike above that, a move north of $3850 would be needed to confirm a short-term trend change.

Given the strong long-term downtrend the $3250 support, the bear market low near $3130, and the key long-term zone near $3000 are all likely to be tested in the coming weeks, even though a broader bottoming process could already be underway after the damaging bear market.

Ripple and Ethereum Remain Under Pressure

XRP/USDT, 4-Hour Chart Analysis

Since Ripple’s recent failed rally attempt the coin hasn’t made any progress, and even though it’s holding on slightly above the key $0.30 level, sellers are still clearly in control of the coin’s market. We continue to expect a move below the $0.28 level in the coming weeks, and traders shouldn’t enter positions here. The coin remains on sell signals on both time-frames in our trend model, with strong resistance still ahead near $0.32, $0.3550, and $0.3750

ETH/USD, 4-Hour Chart Analysis

While Ethereum is also holding up above its swing low from last week, the coin remains very weak from a technical perspective, with no sign o bullish momentum despite the rally attempts of the recent week. A move towards the key $95-$100 zone is still very likely, and a dip below that would open up the way towards the $80 level and the prior bear market low.

With its relative weakness in mind, traders and investors should stay away from ETH until we see at least early signs of technical strength. Primary short-term resistance is found near $112, with further levels above that near $120 and $130, and our trend model remains on sell signals on both time-frames.

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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.

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.