Crypto Update: Coins Hold Lows but Selling Pressure Still Dominant

The major coins stabilized on Thursday after the heavy late-Wednesday selling, although they failed to build up meaningful bullish momentum so far, and stayed below the previous swing lows.

The short-term trend remains bearish in the segment, with still elevated levels of correlation between the coins, and clear downtrends in case of most of the majors, but long-term investors could add to their holdings during the sell-off.

Despite the recent strong downswing, the negative momentum didn’t reach last week’s levels so far, as Bitcoin found support near the next key level at $7650, and the initial break-down in altcoins also ran out of steam.

That said, the market remains vulnerable, without a strong oversold rally, and odds still favor the continuation of the short-term downtrend, even given some positive divergences in the strongest coins.

BTC/USD, 4-Hour Chart Analysis

Bitcoin is showing a positive short-term momentum divergence, but so far, the bounce has been capped by the prior swing low near $8400, and without a durable move about that level, the coin remains bearish, with the downtrend clearly being intact.

Above $8400 the key $9000-9200 is ahead as resistance, while below $7650 further support is found at $7000 and $6750. The recovery from the February lows remains intact, and we still expect it to resume after the current downswing.

Altcoins Still Weak as Ethereum Nears February Low

ETH/USD, 4-Hour Chart Analysis

Ethereum found support just above the February low near $575, and the second largest coin is still trading very close to the low, hovering around the $600 level following the broad bounce.

As the currency continues to be relatively weak, short-term traders should stay away from entering positions here, with the short-term downtrend clearly being intact. Below the prior low, further support is found at $500, while resistance is ahead near $650 and between $740 and $780.

LTC/USD, 4-Hour Chart Analysis

While most of the altcoins are still lagging Bitcoin, trading near the February lows, Litecoin continues to be the strongest major from a technical perspective, while the other initial leaders of the recovery, ETC and Monero are also holding up well above the key levels.

XRP/USDT, 4-Hour Chart Analysis

Ripple is also a bit stronger than Ethereum currently, and traders should watch the relatively strong coins for bullish signs, as they will likely lead the market out of the current downswing.

Stay tuned for our detailed technical analysis coming out later today.

Featured image from Shutterstock

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.