Crypto Update: Coins Drift Lower as BTC Dips Below $10,000

The major coins continue to be under pressure this week, as despite the weekend rally attempt and BTC’s renewed short-term buy signal the major altcoins failed to recover. The top digital currencies are all well in the red today, and with the freshly formed short-term downtrends being intact in the segment, the outlook for the coming weeks still looks bleak, even as the momentum of this week’s decline is weak.

That said, last week’s swing lows are still not in immediate danger, and with BTC still showing relative strength, a broader recovery rally is in the cards, even if odds clearly favor the continuation of the recent plunge. BTC triggered a downgrade in our trend model, as expected in the overwhelmingly bearish market conditions, and now, our model is back on sell signals regarding all of the top coins on both time-frames.

As the bounce cleared the oversold short-term momentum readings, now even the immediate outlook is bearish, and another high-momentum sell-off could be ahead, so traders should remain defensive here even in the case of another rally attempt. While some of the majors, such as LTC, are still not far from a renewed buy signal, the segment-wide trends seem too strong, and we would need signs of broad technical strength to switch to a more constructive stance regarding the segment.

BTC/USD, 4-Hour Chart Analysis

After failing to tackle the key $11,300 resistance despite its relative strength, Bitcoin dipped briefly below $10,000 today, losing some of its technical edge compared to the major altcoins. BTC is still well clear of last week’s low and although it’s now back on a short-term sell signal in our trend model, it could still avoid a crucial technical breakdown below the line-in-the-sand $9200 level.

The direction of the next major swing could determine the trend of the coming weeks or even months, and with the segment-wide trends in mind, traders should remain cautious with new positions even if another buy signal is triggered. Below the Initial support level, with further zones are found at $9,400, $9200 and near $8,400, while resistance above $11,300 is ahead near $13,000.

 ETH/USD, 4-Hour Chart Analysis

Ethereum fell below $210 today in early trading, but so far, it remained in safe distance of the $200 support level and last week’s panicky swing low. The short-term momentum indicators are back in neutral territory after the correction, but the momentum of the current sell-off is weak, and the consolidation could still continue.

That said, the $230 level is still ahead as strong initial resistance, and the freshly formed declining trend is in no danger even in the case of a larger-scale bounce. Our trend model is on clear sell signals on both time-frames, and odds still favor a move below $200 soon. Below that, a key long-term zone is found near $180, with the next support level being at $160, while above $230, further zones are ahead near $260 and $275.

Litecoin Tests Key Zone Again as Ripple Drifts Towards $0.30

XRP/USD, 4-Hour Chart Analysis

Despite a brief period of strength after dipping below $0.30, XRP is once again threatening to violate that key level, with the long-term selling pressure still being apparent in the coin’s market. Ripple drifted below the support/resistance zones near $0.32 and $0.33, and it remains in the weakest technical position out of the top coins, with all of the recent rally attempts quickly fading.

Our trend model is firmly on sell signals on both time-frames, and although a broad rally attempt might once again save XRP from a crucial breakdown, the bear market is very likely to resume in the coming weeks, especially given the new short-term downtrend. Above $0.33, resistance is still ahead near $0.3550, and at $0.3750, while further support zones are found near $0.28 and $0.26.

LTC/USD, 4-Hour Chart Analysis

Although Litecoin showed relative strength this weekend, joining BTC’s rally attempt, it failed to recover above $100 in a sustained fashion and today, it has been testing the $85-$90 support/resistance zone yet again. While last week’s low is not in danger right now, a dip below $85 could open the bearish floodgates again, with downside risks still being high in light of the long-term picture and the market-wide pressures.

Our trend model remains on sell signals on both time-frames, and LTC is now further away from a renewed buy signal in our trend model due to today’s dip. Below $85 the next strong level of support is found near $75, with another major zone at $64,  while above the $100, resistance zones are still ahead between $110 and $112 and near $125.

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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.