Crypto Update: Bitcoin Still a Drag as Ethereum Eyes Breakout
The divergence between the largest coins continued in earnest towards the end of the weekend, and in early trading today, as Bitcoin’s weakness continues to weigh on the market, despite the relative strength of Ethereum and the leading altcoins.
The total value of the market is stuck below $400 billion, and most of the top coins are in the red today, but the underlying bullish trend is still intact, even as no short-term buy signals have been triggered. Besides Ethereum, Ripple, Litecoin, Stellar, Tron, and NEM are showing encouraging strength, while the previously leading EOS and IOTA are still stuck in correction patterns.
BTC/USD, 4-Hour Chart Analysis
Bitcoin is hovering around the key $8400-$8700 support after a failed weekend rally attempt, with the coin still being on a neutral short-term trend signal. BTC has been clearly underperforming since the start of the altcoin led rally in April, and it remains in a corrective pattern.
The coin is oversold from a short-term perspective, while the long-term picture is now neutral again. We expect the recovery to continue after the correction with the $9000-$9200 zone ahead as primary resistance, and further targets found at $10,000, $10,500, and $11,300.
ETH/USD, 4-Hour Chart Analysis
Ethereum is close to providing a short-term buy signal as it’s trading near the upper boundary of the corrective short-term pattern, just below the $735 resistance level. While the long-term momentum indicators are still overbought, the relative strength of the coin is encouraging for the whole segment. In case of a move above $735, resistance is ahead at $780, with targets at $845, $900, and $1000, while strong support is found between $625 and $645.
Correction Still Dominant among Altcoins but Support Levels Hold
LTC/USD, 4-Hour Chart Analysis
Despite the back and forth price action of the recent days, the technical setup didn’t change in the majors, and most of the smaller coins are following the broader corrective trend. That said, as none of the top coins hit new correction lows, the underlying trend could resume soon, and short-term traders should be looking for entry points in the coming days. Litecoin is among the top candidates for a buy signal as a move above $150 would suggest at least a test of the previous high at $180, with the corrective pattern already being broken by the coin.
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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.