Crypto Update: Coins Bottom Out As Short-Term Trend Remains Upbeat

The major cryptocurrencies are having a strong day following two bearish sessions after bottoming out overnight above their crucial support levels. The possible swing low left the short-term uptrends intact in the segment, so a more sustained counter-trend move remains a possibility here, despite the volatile pullback. Even the relatively stronger coins failed to establish a new swing high, so the trend is not yet solidified but, nevertheless, today’s price action is promising for bulls.

That said, the long-term outlook remains bearish, and while our trend model continues to confirm the advancing short-term trends, traders should continue to apply strict risk management rules as odds favor further downside following the current rally. BTC is still in the best technical position among the top coins, and should a few altcoins show sustained strength, the possibility of a long-term trend change would increase significantly.

BTC/USD, 4-Hour Chart Analysis

BTC continues to trade below its declining long-term trendline, even in the wake of today’s bounce, and although the short-term uptrend is clearly intact, the coming days could still see a volatile shift. The coin held up above $7,600 support level and its post-crash range, and since the overbought short-term momentum readings have been cleared, bulls can still hope for a long-term trend change.

BTC is on a short-term buy signal in our trend model, while still being on a long-term sell signal, with support zones found near $7,800, $7,600, $7,400, and $7,000, and with resistance ahead near $8,200, $8,400, and $8,650.

ETH/USD, 4-Hour Chart Analysis

ETH bounced off the upper boundary of its prior short-term trading range, and thanks to the broad rally in the segment, it remains bullish from a short-term perspective. The key long-term $145 resistance is still towering ahead of the coin, but with the other major altcoins joining the rally attempt, a test of the $160 level seems possible.

Our trend model is on a short-term buy signal while still being on a long-term sell signal, with major support zones found near $135, $130, $120, and $100, and with resistance zones ahead near $145, and $160.

XRP Shows Weakness As LTC Leads Bounce

XRP/USD, 4-Hour Chart Analysis

XRP bounced higher together with its closest peers today, but it remains well below its recent swing high, even as it recaptured its November low. The bearish long-term trends remain dominant but following months of steep losses, a more sustained counter-trend move could still be ahead.

XRP is on a short-term buy signal while still being on a long-term sell signal in our trend model, with support zones now found near $0.20, $0.1930, and $0.1750, and with resistance zones ahead near $0.21, $0.23, and $0.2475.

LTC/USD, 4-Hour Chart Analysis

LTC already got close to its recent swing high after testing the $44 level yet again overnight. The coin regained its relative strength today, but given the hostile long-term technicals, the current move should still be treated as a prone-to-fail counter-trend rally. A sustained higher high could solidify the short-term uptrend and traders can still enter new positions here, but strict risk management rules should be applied.

LTC is now on a short-term buy signal while still being on a long-term sell signal in our trend model, with support zones now found near $44 and $38, and with resistance zones ahead near $51 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.

Author:
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.