Crypto Update: Coins at Major Decision Point

The cryptocurrency segment is at a very important juncture before the weekend, as Bitcoin and the other leaders of this week’s rally are trading near the support levels that should hold to keep the short-term hopes for bulls alive.

With the broad declining trend in most of the majors still being intact, there is still considerable technical selling pressure on the digital currencies, especially as the relatively weak Ethereum and Ripple dragging the market lower too.

Trading volumes are low as the news flow has been rather neutral in recent days, with technical factors dominating price action, and with the heavy selling in traditional asset classes spilling over somewhat into the segment. The low volume environment supports the bullish case, although the correlation between the coins is still elevated, and given the major laggards, the overall picture is mixed.


BTC/USD, 4-Hour Chart Analysis

Bitcoin is trading just above the key short-term support level near $8400, with the MACD indicator still showing an ongoing correction. A durable move below that level would be a bearish short-term sign, but for now, the coin remains on a short-term buy signal, while the long-term setup is also favorable for investors. The crucial $9000-$9200 zone is the primary resistance, with the $10,000 level and the declining trendline also ahead, while strong support is found near the $7650 level.

ETH/USD, 4-Hour Chart Analysis

Ethereum is still not showing signs of strength, being stuck in a steeply declining short-term trend, even as the long-term picture is clearly oversold. The coin got close to the primary support near the $500 level in early trading after turning lower of the declining short-term trend and the resistance zone near the $575 two days ago. Below $500 support is at $450 and $400, with further resistance ahead at $625, and in the $740-$780 zone.

Altcoins Undecided Too

DASH/USD, 4-Hour Chart Analysis

As we noted, correlations are still high, with no clear outperformers amid the broad pullback, besides EOS, but with the early leaders only sporting manageable losses, the buy signals are still intact although short-term traders should use relatively tight stop-loss orders here.

LTC, IOTA, NEO, Cardano, Stellar and ETC are performing in-line with the segment average, while Dash is showing a hint of relative strength and Monero is lagging the other majors a bit, but the differences are not significant, and we still expect the coming days to be crucial for the coins.

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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.