Crypto Update: Breakdown Averted But Selling Pressure Remains Strong

The major cryptocurrencies settled down following a decisively bearish Monday after giving back most of their weekend gains. BTC saw the most action, dipping briefly below its initial support level, but the relatively weak coin, together with its most important peers managed to avoid another major technical blow. Despite the intraday recovery, the top coins all remain under pressure, and the outlook remains bearish.

The long-term setups are still clearly negative in the segment, and while the rally attempt that started in late-October could still resume, bulls need to prove their strength in the coming days to avoid a breakdown. The recently strong LTC failed to lead the way higher today, and as there is still no strong leadership present in the market, the odds of a broad turnaround are low, and downside risks remain high.

BTC/USD, 4-Hour Chart Analysis

BTC hit another three-week low today before bouncing back together with the broader market, but the coin failed to get close to the key $9,200 price level, remaining in a relatively tight range throughout the day. BTC is still a tad above its prior trading range, but given the segment-wide trends and its relative weakness, we still expect it to re-enter that range in the coming days.

The coin is still on sell singles on both time-frames in our trend model, with support zones found near $8,650, $8,400, and $8,200, and with resistance ahead near $9,200 and $10,000.

ETH/USD, 4-Hour Chart Analysis

ETH continued to show stability compared to its peers today, and even though it dipped below $185, it held up above the $180 level staying within the key zone for the better part of the session. ETH is stuck in a volatility-compression pattern, but compared to BTC it’s showing short-term strength, and that keeps bulls’ hopes regarding a broader altcoin rally alive.

That said, our trend model is still on sell signals on both time-frames, with further support zones now found near $160, $145, and $130, and with resistance zones ahead near $200 and $230.

XRP And LTC Lose Ground As LTC’s Strength Fades

XRP/USD, 4-Hour Chart Analysis

Following a bearish weekend and a negative Monday, XRP remained among the relatively weaker majors today, hitting another three-week low together with BTC. The coin is still well below the $0.28 resistance level, and even though it continues to hold up above $0.26 it remains under clear selling pressure, in line with its persistent relative weakness.

XRP is still on sell signals on both time-frames in our trend model, with support zones now found near $0.26, and $0.2475, and with resistance zones ahead near $0.28, $0.30, and $0.32.

LTC/USD, 4-Hour Chart Analysis

Despite showing relative strength for a week, today, LTC failed to register a meaningful bounce, remaining well below the key $64 level. While the coin could still regain its strength and continue the counter-trend rally, its long-term weakness continues to warrant caution. A move below $56 could lead to a volatile sell-off in the coming days, even though the prior swing low is still in a safe distance.

LTC remains on sell signals on both time-frames in our trend model, with further resistance zones found near $56, $51, and $44 and with the next major resistance zone ahead near $75.

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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.