Crypto Update: Bitcoin Goes Stop Hunting As Volatility Skyrockets

The major cryptocurrencies had a wild session, which started out in a decisively bearish fashion but ended on a positive note for the top two coins. While initially the Fed’s ‘hawkish rate cut’ hurt the segment, the uncertainty of the post-Fed-decision supported the ETH-led rebound in the top coins. Bitcoin plunged briefly below $10,000 in early trading after trading in a very narrow range above the key price level for days, but it managed to recover as sentiment turned bullish again.

While BTC and ETH concluded a bullish session, the rest of the market failed to completely recover from the early plunge, and the likes of LTC and XRP are well below their recent highs, even as ETH hit a new rally high in late trading. While BTC couldn’t break out above its prior range to complete a failed breakdown pattern, it held on to its short-term buy signal in our trend model, and that could give a boost to the whole segment, despite the still bearish long-term setups among the top altcoins.

BTC/USD, 4-Hour Chart Analysis

While BTC’s technical setup is still unchanged, the coin is back above the $10,000 price level, and the broad triangle consolidation pattern is still intact, as bulls avoided a key breakdown today, despite triggering a slew of stop-loss orders. That said, a bullish continuation is far from being certain, and until we see further evidence of a segment-wide bottom, traders should remain cautious.

In line with that, our trend model is still on a long-term sell signal, and below the initial $10,000 level, support is still found near $9.200, $8,400, and $8,200, while resistance zones are ahead near $11,300, and $13,000.

ETH/USD, 4-Hour Chart Analysis

After getting close to the $200 level during the overnight dip, ETH rose by more than 10% to top out near $225. The coin hit its highest level since early August, but since the smaller altcoins are lagging behind, we still only consider the current move as a counter-trend rally.

The short-term buy signal in our trend model is intact, but the coin is still on a long-term sell signal, and the next target zone is just above its current price level. Support below the initial $200 level is still found between $180 and $185 zone, while resistance is ahead near $230 and $260.

Ripple Crashes Back to $0.28 as LTC Remains Weak

XRP/USD, 4-Hour Chart Analysis

After yesterday spike above $0.32, XRP quickly gave up its relative strength, as it plunged back to $0.28 in very active trading. The coin recovered above $0.30 later on, together with the broader market, but it remains well below yesterday’s swing high. In light of the bearish long-term setup, traders should still focus on the relatively stronger coins despite the still intact short-term uptrend.

Our trend model remains on a long-term sell-signal, with strong resistance zones ahead near $0.32 and just above $0.330, and with support zones now found near $0.28 and $0.26.

LTC/USD, 4-Hour Chart Analysis

Litecoin followed the market-wide trends today, falling as low as $72.50, before bouncing back above $75, but it remains relatively weak from a technical perspective. The coin managed to hold on to its short-term buy signal in our trend, but should it violate today’s low, the broader downtrend could quickly resume.

The coin is still on a long-term sell signal, with resistance zones ahead between $85 and $90 and near $100, while support zones below $75 are found near $64 and $56.

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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.