The crazy crypto weekend continued Saturday night as Etherum broke below its recent low, triggering another huge wave of selling and forced liquidations as margin calls got initiated after the deep correction. The cryptocurrency dragged the whole market lower amid, with all the majors falling strongly, but lots of small cap coins held up above their previous lows. The price of the ETH token spiked as low, as $135 marking a 66% decline from the $400 high, before bouncing back above $150.
ETH/USD, 4-Hour Chart Analysis
The crypto markets total value fell below $60 billion during the plunge, nearing a 50% decline from the historic highs of $110 billion only a month ago. The mainstream narrative is still focused on the possible Bitcoin fork and the Judgement Day of the coin. As BTC is “only” 30% off its highs currently, the weight of the most valuable cryptocurrency surged back towards the half of the total market. The extent of the correction (that started out in a highly overbought situation) is comparable to the preceding rally, but the coins still only got back to levels that they first reached in the middle of May. Let’s see how the majors performed during the Ethereum crash.
Broad Sell-Off Followed by Strong Bounce
BTC/USD 4-Hour Chart Analysis
Bitcoin also spiked below important support in the thin-volume environment (that turned into one of the highest volume days of the segment), but it quickly bounced back in the base pattern that we have been monitoring in recent weeks, as a possible low for the long-term correction. While short-term traders should still be cautious as the downtrend is intact, the long-term charts are now showing oversold readings and a long-term bottom could be very close in time.
Litecoin/USD 4-Hour Chart Analysis
The other majors also tested or fell below primary support levels, with Ripple being pushed back near its recent low, Litecoin holding up well near $40 after a spike lower, while Dash testing its rising long-term trend before a strong bounce higher. Ethereum Classic also showed relative strength, holding above last week’s low.Short-term traders should still look confirmation of a trend change (at least a rally above the prior low near $170 in ETH and $2000 in BTC now) before entering significant new positions in the majors, as the trend remains negative, despite the oversold long-term picture.
Ethereum Classic, 4-Hour Chart Analysis
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