Crypto Update: Rally Runs Out Of Steam But Coins Remain Stable

While yesterday’s encouraging rally ended without a broad breakout in the cryptocurrency segment, the major coins continue to trade in advancing short-term trends. The top coins haven’t violated key support levels, remaining stable after yesterday’s late-day pullback. As volatility remains low and the short-term momentum indicators aren’t showing overbought readings, a test of this week’s swing highs could be ahead, even as the long-term outlook remains bearish.

While still, only LTC managed to hit a new swing high, the majors are not far off their recent highs, and even XRP, which has been showing weakness in recent days gathering some strength in the quiet weekend environment. Despite the positive short-term developments and BTC’s possible long-term trend change, bulls would need further technical evidence to turn more constructive towards the segment.

BTC/USD, 4-Hour Chart Analysis

While BTC is still trapped below the $8,200 level, and it also failed to reach its recent swing high this weekend, it continues to trade above its crucial long-term trendline. The coin could still shift the long-term trend in the coming weeks, even given its current slight relative weakness, but a failed breakout is also in the cards, so caution is still warranted here.

BTC is on a short-term buy signal in our trend model, while still being on a long-term sell signal, with support zones found near $7,800, $7,600, $7,400, and $7,000, and with resistance ahead near $8,200, $8,400, and $8,650.

ETH/USD, 4-Hour Chart Analysis

ETH is trading just a hair below the $145 level following a choppy weekend, and the coin is in safe distance of its post-crash trading range, which makes a more sustained counter-trend move possible.  ETH remains weak from a long-term technical perspective, though, and even in the case of a durable short-covering rally, the outlook for the coming months remains bearish.

Our trend model is on a short-term buy signal while still being on a long-term sell signal, with major support zones found near $135, $130, $120, and $100, and with resistance zones ahead near $145, and $160.

XRP Eyes New Swing High As LTC Holds $50

XRP/USD, 4-Hour Chart Analysis

XRP got closer to its prior swing high thanks to an overnight spike, and as it stabilized above the $0.21 level, another breakout remains a possibility in the coming days. That said, the coin remains very weak from a broader perspective, and while a more sustained counter-trend rally is possible, the bear market is still likely to resume.

XRP is on a short-term buy signal while still being on a long-term sell signal in our trend model, with support zones now found near $0.21, $0.20, and $0.1930 and with resistance zones ahead near $0.23, and $0.2475.

LTC/USD, 4-Hour Chart Analysis

LTC is still very strong from a short-term technical perspective, holding up above $50 in choppy trading today, despite the overbought short-term momentum readings. The coin remains clearly above its November low and its prior trading range, but given the steep losses of the second half of 2019, the long-term downtrend is still in no danger.

LTC is now on a short-term buy signal while still being on a long-term sell signal in our trend model, with support zones now found near $44 and $38, and with resistance zones ahead near $51 and $56.

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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.