Cryptocurrency Update: Bloody Monday?
The major coins turned sharply lower today after a mixed start in Asian trading as Ethereum’s rally to new all-time highs was met by heavy selling in the European session. The reversal in overbought territory triggered a short-term sell signal in our trend model, and now the recently leading coin is likely to enter a deeper correction. The price of ETH could find support near the $850 level, with further key areas to monitor around 740, $625, $575, and $500.
ETH/USD, 4-Hour Chart analysis
As South Korean authorities are allegedly heating up the regulation of the crypto market, sentiment turned bleaker, given the huge share of the country in the segment. That said, the correction that started in Bitcoin in the last weeks of 2017 is more a technical phenomenon, with the stellar run-up of the previous months likely being the real reason behind the move, pushing the market to an extremely overbought state from a long-term perspective.
With that in mind, we still expect the correction to continue with a likely dip below $10,000 in the coming weeks.
Above that, the $13,000 and $11,300 levels could provide support for BTC.
BTC/USD, 4-Hour Chart analysis
Altcoins Also Under Pressure
The total value of the market is down to $725 billion as of now with Ripple losing the most in Dollar terms following its exponential rise and the short-term sell signal on Friday.
XRP/USDT, 4-Hour Chart analysis
Correlation between the majors spiked higher during today’s move, but although most of the coins are moving in a synchronized fashion, the technical position of some of the altcoins is different. This means that buying opportunities could emerge earlier in the likes of IOTA, Ethereum Classic, and Litecoin, but in such market conditions, a few days could mean a lot in percentages in a volatile segment like the cryptocurrency market.
Stay tuned for our detailed technical analysis coming up later on today.
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.