Crypto Update: Coins Rebound as Bitcoin Breaks $8400
The major coins took another beating overnight, as a wave of selling pushed Bitcoin below the key $8400 support. The break of support triggered stop-loss orders which caused a spike lower, but as selling dried up, the segment quickly recovered.
While the rebound is promising, the short-term correction is still intact, and the coins remain on a neutral short-term trend signal. That said, aggressive traders could enter positions here, with stop losses below the overnight lows, as we expect the recovery continues following the correction.
BTC/USD, 4-Hour Chart Analysis
Bitcoin hit a bottom near $8200 before bouncing back into the $8400-$8700 zone, as the short-term momentum indicators reached oversold territory thanks to the selloff. While the news-driven decline could still continue, a quick recovery above $8700 would be a bullish sign for the still relatively weak coin’s market. Above $8700 resistance is in the long-term support/resistance zone between $9000 and $9200, with further targets at $10,000, $10,500, and $11,300.
ETH/USD, 4-Hour Chart Analysis
Ethereum continues to outperform Bitcoin from a technical perspective, and the coin found support in the range between $625 and $645. ETH is also oversold short-term, while still being overbought on the daily time-frame. With that in mind, traders should be cautious with short-term positions, while investors shouldn’t add to their holdings yet. Primary resistance is ahead between $735 and $780, with a short-term level at $700, while further support is in the $555-$575 zone.
Altcoins Also Higher as Correlations Still Elevated
IOT/USD, 4-Hour Chart Analysis
The correction dragged all of the majors lower, with small-cap coins following the largest digital currencies as well. Correlations remained high during today’s bounce, as the generally bearish conditions rare still dominant short-term.
The leaders of rally are also still in correction mode, with EOS and IOTA both testing important support levels today. IOTA spiked as low as the $1.7 level before the rebound, as the overbough long-term momentum readings led to a deeper correction.
Despite the correction, we remain bullish on the coin, and the segment, and we expect the rally to resume in the coming weeks.
We will cover the long-term technical outlook for the segment later on rhis weekend.
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.