Crypto Update: Coins Drift Lower But Majors Hold Gains

The cryptocurrency segment settled down following a tumultuous Monday session that saw new multi-month lows in the majors before a violent snapback rally took hold of the market. The short squeeze ran out of steam before changing the technical setups in the segment, but it also trapped bears who speculated on a major downswing despite the oversold short-term momentum readings, so a more sustained consolidation period could now be underway.

Despite the bounce, the top coins have all been under pressure today in early trading, and with the October lows proving too strong to overcome, the key technical breakdown is clearly intact. Sellers remain in control on all time-frames, and downside risks remain very high from a broader perspective. Our trend model remains overwhelmingly bearish too, and even in the case of a more sustained rally attempt, traders should remain defensive.

BTC/USD, 4-Hour Chart Analysis

BTC is stuck in a choppy trading range between $7,000 price level and the previous low near $7,400, and the oversold momentum readings are being cleared thanks to the correction. The coin remains in a very weak technical position, and within a broader downtrend, and new lows remain very likely in the coming weeks.

The coin is still on sell signals on both time-frames in our trend model, with support zones now found near $7,000, $6,750, and $6500, and with resistance ahead near $7,400, $7,600, $7,800, and $8,200.

ETH/USD, 4-Hour Chart Analysis

While ETH topped the $150 level during yesterday’s bounce, it has been showing technical weakness today in early trading, and it is threatening with a move below the key long-term $145 level yet again. The $130 support is still in no danger, and the bounce could still continue, but with the crucial $160 level seeming unreachable, for now, the coin could be in for more losses as soon as the correction clears the oversold momentum readings.

Our trend model remains on sell signals on both time-frames, with support zones found near $145 and $130, and with resistance zones ahead near $160, between $180 and $185, and near $200.

XRP Still Leads The Decline As LTC Shows Stability

XRP/USD, 4-Hour Chart Analysis

XRP remains very weak from a short-term technical perspective, trading below its weekend low and well off the $0.23 support/resistance level. That said, XRP is still holding above the $0.21 level and the September panic low. The bear market is very likely to continue in XRP’s market, and the coin is likely to lead the way lower due to its long-term weakness.

XRP is still on sell signals on both time-frames in our trend model, with support zones found near $0.21 and $0.20, and with resistance zones ahead near $0.23, $0.2475, $0.26, and $0.28.

LTC/USD, 4-Hour Chart Analysis

LTC has been relatively stable, so far, today holding up well above the $44 level and yesterday’s intraday swing low as well. Despite its stability, LTC is also stuck below its October low, and its weekend bounce-high, leaving the technical breakdown and the short-term downtrend intact. Should the coin build up relative strength, the whole segment could get a short-term boost, but bulls need more evidence to consider even a very short-term trade in LTC.

LTC remains on sell signals on both time-frames in our trend model, with support zones now found near $44 and $38, and with resistance zones ahead near $51, $56, and $64.

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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.