Crypto Update: Coins Hold Their Ground as Bulls Take a Breather
The major cryptocurrencies settled down following yesterday’s Litecoin-led pullback, and as the coins respected the key trendlines and support levels, odds favor the continuation of the short-term uptrend. The leaders of the rally remained strong amid the shallow correction, and although the long-term setup remains clearly bearish, the traders could enter smaller speculative positions, still using strict risk management rules.
While the top coins haven confirmed the short-term swing lows yet, the coming days could see new highs, with all eyes on the $4000-$4050 zone in Bitcoin and the $160 price level in Ethereum. The majors still have to form a pattern of higher highs and higher lows on the long-term charts to change the long-term outlook, so our trend model remains on sell signals on that time-frame. That said, the overbought short-term momentum readings are quickly being cleared, so the short-term outlook remains positive.
BTC/USD, 4-Hour Chart Analysis
Bitcoin has formed a bullish consolidation pattern in the past day, and the $3850 level has been clearly supporting the coin, leaving the relatively weak short-term uptrend firmly intact. The MACD indicator is still pointing to an ongoing correction, but our trend model remained on a buy signal on the short-term time frame, and the uptrend could soon resume.
Despite the positive immediate outlook, the $4000-$4050 resistance zone is still very strong, and further consolidation is also possible before a successful break-out. A move above that zone could open up the way towards the $4450 level, but even that wouldn’t change the bearish long-term setup in the most valuable coin’s market.
XRP/USDT, 4-Hour Chart Analysis
Ripple has been trading near the $0.32 support level in the past 24 hours, still being relatively weak compared to its major peers. The coin remains stuck below the dominant declining short-term trendline that it tested during the recent upswing, and our trend model continues to be on a short-term sell signal.
Below the primary support zone, further levels are found near $0.30, $0.28, and $0.26, while short-term targets for a possible break-out are still ahead near $0.3550, and $0.3750, but traders should still stay away from XRP
Litecoin, Ethereum, and EOS Look Ready to Lead Again
LTC/USD, 4-Hour Chart Analysis
While Litecoin entered a correction after touching the $51 resistance level yesterday, the pullback has been contained so far and even the steep short-term uptrend line remained intact. Given the extent of the recent move higher, even a test of the $44 level would leave the break-out intact.
A move above the primary resistance zone could lead to a rally towards the $56 level, and as Litecoin has been leading the market during the current counter-trend advance, its performance should be monitored closely. Below $44 further strong support is found near $38, and $34.50, and our trend model is back on a short-term buy signal while being bearish from a long-term standpoint.
ETH/USD, 4-Hour Chart Analysis
Ethereum is still trading in a bullish short-term correction pattern near $145, working its way through the overbought short-term momentum readings. The short-term uptrend is clearly intact, and although a deeper pullback is still possible traders could already enter new positions here.
With the long-term downtrend in mind, strict risk management rules are still essential here, even as Ethereum is one of the strongest majors from a short-term technical point of view. Support levels below $145 are still found near $130 and $112, while above $160, the next major resistance zone is ahead near $180.
EOS/USD, 4-Hour Chart Analysis
EOS is still the strongest major from a short-term technical standpoint, and although it continues to be overbought according to the key momentum indicators, aggressive traders could enter positions here. Buying pressure is apparent in the coin, but a deeper pullback towards the $3.50 level is still in the cards. Support is also found near $3.80 and $3, while resistance is ahead near $4 and $4.50.
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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.