Crypto Update: Coins Retreat Again As Bounce Hits A Wall

The cryptocurrency segment continues to be dominated by the post-crash consolidation that started following Thursday’s failed breakdown. The majors now cleared the oversold short-term momentum readings thanks to the rather choppy weekend and yesterday’s XRP-led rally attempt, meaning that the odds of another move lower are increasing. The broader declining trend and last week’s technical breakdowns remain intact, and strong resistance levels are still towering ahead of the majors.

With no indication of even a short-term trend change, we continue to advise traders to stay away from entering new positions here, especially as even the relatively stronger coins couldn’t sustain their bullish momentum. XRP and ETH both retreated after getting close to the crucial $0.26 and $185 levels respectively, and since the other top digital currencies are also under clear selling pressure, bears remain in control of the market.

BTC/USD, 4-Hour Chart Analysis

While BTC briefly recaptured the $8,400 level, it remains relatively weak from a short-term technical perspective and it’s also well below last week’s breakdown level. With that, the outlook for the coin is still clearly bearish, and although the consolidation could still continue, we expect new lows in the coming weeks.

The coin is still on clear sell signals on both time-frames in our trend model, with support zones found near $8,200, $7,600 and $7,800, and with resistance zones now ahead near $8,400, $9,200, and $10,000.

ETH/USD, 4-Hour Chart Analysis

ETH’s rally topped out right at the upper boundary of the resistance zone between $180 and $185, and today it plunged back below that zone, testing the lower trendline of the dominant bearish short-term pattern. While the coin is holding up above that line, the consolidation period could soon end, and another leg lower is still likely.

Our trend model is on sell signals on both time-frames, with support zones now found near $160, and $145, and with resistance zones ahead between $180 and $185 and near $200 and $230.

Ripple ‘s Rally Fades As Litecoin Drifts Sideways

XRP/USD, 4-Hour Chart Analysis

XRP once again failed to show bullish follow-through after yesterday’s spike to the $0.26 level, and while the coin is hovering in the vicinity of the $0.2475 support, we remain skeptical even regarding the odds of a more sustained correction in the relatively weak coin’s market.

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

LTC/USD, 4-Hour Chart Analysis

LTC couldn’t maintain its breakout attempt above the key $56 level, and while the coin remains stable as the leaders of the bounce pulled back, it remains the prime candidate to lead the way lower following the current consolidation phase.

With that in mind, traders should stay away from entering new positions, and the coin is still on sell signals on both time-frames in our trend model, with further resistance zones above $56 ahead near $64 and $75, and with major support zones now found near $51 and $44.

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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.