Technical Analysis: Bitcoin Falls Below $9000 as Positive Divergences Emerge

The correction that started on Monday accelerated in the last couple of days, and a bottom could already be in after today’s overnight rout, given the panicky market action, although a re-test or another leg lower is still in the cards, as the short-term downtrends are intact in the majors.

BTC/USD, 4-Hour Chart Analysis

Bitcoin has been leading the way lower, with the Mt. Gox Whale reports driving the most valuable coin’s price lower. BTC violated the line-in-the-sand support zone between $9000 and $9200 during the latest round of the sell-off, and it remains stuck below that despite the bounce in European trading.

The short-term MACD is now clearly oversold, almost reaching crash-territory, and long-term investors can once again add to their holdings here, while traders should wait for the short-term trend to turn before entering new positions. Below today’s lows, strong support is found near $7650, while further resistance is ahead at $10,000 and $10,500.

Correlations, which remained elevated throughout the fall, with all of the majors hitting new lows in a concerted fashion, are now breaking down slightly and some coins are showing early signs of relative strength. That said, the declining short-term trends are still intact, and traders should remain defensive in case of most of the top coins.

ETH/USD, 4-Hour Chart Analysis

Ethereum is also still in a clear short-term downtrend following the failure to break-out from the broader bearish trend. Despite the current move, we expect the coin to resume the recovery, and tackle the longer-term downtrend again. Short-term support is now found near $650, with a stronger level at $625, while resistance is ahead near $740 and $780.


LTC/USD, Daily Chart Analysis

Litecoin spiked below the $170 support overnight, but it remained relatively strong amid the broad decline, and the coin has also been leading the way higher today. The coin is already on the verge of a short-term buy signal, and as LTC was one of the early leaders of the recovery that bodes well for the rest of the segment too. Resistance is still ahead at $200, between $225 and $235, and at $250, while key support below $170 is at $150.


DASH/USD, 4-Hour Chart Analysis

Dash continues to trade relatively weak compared to the other majors, as it is trading just above the intraday low, after back in the prior declining trend today. While short-term traders should still stay away from entering new positions, long-term investors could add to their holdings at the current levels. Resistance is now found near $500, $600, and $650, while support is near $435, $400, and $375.


XRP/USD, 4-Hour Chart Analysis

Ripple held up relatively well despite dipping below $0.85 again, and the coin is not far off the crucial level despite the continued selling pressure in the segment. A recovery above resistance would be a bullish short-term signal, but for now, traders should remain defensive here, but investors could still add to their holdings. Resistance is still found at $1, $1.25, and $1.5, while primary support is at $0.68.

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

ETC is showing early signs of strength near the $20 level, but for now, bears are firmly in control, and short-term traders shouldn’t open new positions here. The declining short-term trend is clearly dominant, and a test of the $18 level is still possible in the coming days, with further support at $16 and $14.50. A rally above $23 would open up the way to $25 and $27 and long-term investors could once again add to their holdings after the deep correction.


XMR/USD, 4-Hour Chart Analysis

Monero plunged as low as the $240 support overnight, and the short-term momentum is now in oversold territory, pointing to a possible durable bottom. That said, traders should remain defensive until a confirmed trend change, while investors should also wait with adding to their holdings after the strong recent rally. Key resistance is ahead near $280 and $300, while further support is at $215 and $200.


NEO/USDT, 4-Hour Chart Analysis

NEO hit $80 during the recent leg of the sell-off, and the coin is now oversold from a short-term perspective, with a likely short-term bottom being close. Long-term investors could still add to their holdings here, as we expect the recovery to resume. Support below $80 is at $64, while resistance is ahead at $100, between $120 and $130, just above $150, and at $190.


IOTA/USD, 4-Hour Chart Analysis

IOTA is stuck below the vital $1.5 level, and the coin was the only one hitting a new low below the February minimum, confirming its relative weakness. Short-term traders should still stay away from opening new positions, despite the clearly oversold momentum, with support levels found at $1.2 and $1.1.

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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.