Crypto Update: Market Retreats as Coins Run Into Resistance

The broad rally of the past few days halted today, as several of the majors reversed course after reaching key resistance levels and trendlines. The total value of the market is still around $225 billion as smaller coins outperformed their larger peers, and the broader bearish patterns are mostly still intact in the segment.

Almost all of the top coins joined the short-term rally, but none of them changed the long-term trend signal, with still only Bitcoin being on a neutral signal according to our trend model. With that in mind this week’s move still only qualifies as a counter-trend move, and other than short-term positions, traders and investors should remain defensive regarding the segment.

BTC/USD, 4-Hour Chart Analysis

Bitcoin entered a shallow correction before reaching the next major resistance zone between $7200 and $7300, and now the coin is back near the $7000 level, trying to establish a short-term swing low. BTC remains on a short-term buy signal, as the weak rising trend is intact, but the long-term signal is still only neutral. Key support is found near $6750, with further levels at $6500 and $6275, while long-term resistance is ahead between $7650 and $7800.

ETH/USD, 4-Hour Chart Analysis

Ethereum continues to be the weakest link among the top coins as it turned lower today with the broader market after lagging the segment’s average during the preceding rally as well. As the coin failed to rise above the key $300 level, it remains on a short-term sell signal while also being negative from a long-term perspective. Primary support is found between $275 and $280, with the previous swing low at $260, while further resistance is ahead at $335 and near $360.

Altcoins Tackle Dominant Trendlines

IOTA/USDT, 4-Hour Chart Analysis

The leaders of the short-term rally reached up to key trendlines in the last 24 hours, and the likes of IOTA, DASH all turned lower, while the early leader Ripple also failed to extend its rally. IOTA is trading near the $0.75 level after the strong oversold rally, but even though it briefly spiked above the dominant trendline, it remains within the broader bearish pattern. That said, the short-term trend signal is still bullish, but a re-test of the lows is still likely from a longer-term perspective.

XRP/USDT, 4-Hour Chart Analysis

Ripple is still struggling to get back above the $0.35 level, as the rally of the past few days failed to lift the third largest coin. XRP is still well shy of the $0.42 level which marked the structural breakdown in the market, and apart from short-term positions, the outlook remains negative. A break below $0.32 would warn of a test of the lows near $0.26, further support levels are found near $0.3125 and $0.30, while the recent spike high is ahead as resistance near $0.3750.

generally defensive given the bearish long-term setups, but the short-term outlook clearly improved.

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.