Crypto Update: Sell-Off Continues as Coins Threaten Key Support Levels

The cryptocurrency segment had another bearish session as yesterday’s Ripple-led sell-off dragged Bitcoin lower, and all of the major altcoins hit new lows as well. Eth fell below $275, BTC plunged below $11,300, Litecoin violated $100, while the still strikingly weak Ripple briefly dipped below $0.32. The picture is not pretty among the smaller coins either, with all of the major coins sporting losses of at least 5%, and most of them being down by close to 10%.

The early leaders of the larger-scale rally are still showing weakness, and although some of the majors are encouragingly stable, the broader top that we have been anticipating is close to being confirmed. Bitcoin’s relative strength is still the most bullish sign, but Liteocin is also holding up near $100, and Monero and ETH avoided major technical damages as well.

Despite the ‘green shoots’, the overall picture is bearish, and our trend remains on sell signals on both time-frames in our trend model, even though we still can’t rule out a Bitcoin-led recovery. Apart from BTC, no major is trading in a short-term uptrend in the wake of the steep sell-off, and barring a quick recovery in the likes of ETH and LTC, the bearish segment-wide forces will likely dominate trading in the coming weeks.

BTC/USD, 4-Hour Chart Analysis

Bitcoin continues to hold up relatively well, trading way above its recent swing low and bouncing back above the $11,300 despite today’s broad sell-off. With the segment-wide trends and the long-term setup in mind, a broader topping pattern is still likely to be confirmed soon, but above, the recent the swing low, bulls can still hope for another rally attempt.

For now, the coin remains on sell signals on both time-frames in our trend model, and without the other majors showing technical strength, traders shouldn’t consider reentering the coin’s market, even in the case of a bounce. Below $11,300 further strong support zones are found near $10,000, $9400, $9200, and $8400, with resistance levels ahead near $13,000 ahead near the prior swing high just below $14,000.

XRP/USD, 4-Hour Chart Analysis

Ripple remains the weakest major on all-time frames, and with today’s plunge the coin is now threatening the $0.30 support level as expected. XRP sliced through the $0.3550, $0.33, and briefly the $0.32 level today, confirming the new downtrend yet again, and putting pressure on the whole segment. We still expect the bear market to resume soon, and should the $0.30 level fall, the test of the $0.28 level would likely follow.

That said, a stronger bounce is now in the cards, due to the oversold momentum short-term readings, but traders should stay away from entering the coin’s market, as any bounce is prone to fail here, even though a broader-based rally attempt could trigger a meaningful pop higher. Below $0.28, further support is found near $0.26, while above $0.350 the next major resistance zone is ahead near $0.3750.

Ethereum and Litecoin Try to Stage Bounce off Key Levels

ETH/USD, 4-Hour Chart Analysis

Ethereum confirmed a new declining short-term trend after finally leaving the vicinity of the previously dominant rising trendline, and although a quick recovery above $275 could save the rally, in light of the larger-scale pressure, downside risks remain very high here. The $260 support provided support for ETH today, but with the smaller altcoins being hammered across the board, even the immediate outlook is bearish, despite the oversold short-term momentum readings.

All eyes are now on the key $230 support, which could be the next bearish target for the move, and a sustained dip below $260 would be a warning signal for the whole segment. Below $230, further support levels are found near $200 and $180, while above the initial resistance zone near $275, further levels are ahead near $300 and $330.

LTC/USD, 4-Hour Chart Analysis

From a broader perspective, Litecoin is still among the strongest majors technically, but with the crucial $85-$90 zone now in sight, a strong downswing could be ahead for the previously leading coin. LTC violated several resistance zones today, and although above $85, bulls can still hope for a recovery, downside risks remain dominant, and traders shouldn’t enter new positions here.

Our trend model is on clear sell signals on both time-frames, and the key $110-$112 zone is now ahead as strong initial resistance. The $100 price level has been supporting the coin today, but a test of the mentioned $85-$90 zone is now very likely, with further zones found near $75 and $64, while resistance above $112 is ahead near $125 and $140.

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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.

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.