Technical Analysis: Bitcoin Tests $9000 as Altcoins Pull Back after Strong Rally

The cryptocurrency segment is in a short-term correction after a great week that saw several key resistance levels fall, as the major coins kept up the bullish momentum and hit new rally highs after a shallow correction. Ethereum and the smaller altcoins continued to outperform Bitcoin on the way higher in the last couple of days, but today, Bitcoin is holding up relatively well amid the pullback, indicating a slight change of behavior.

BTC/USD, 4-Hour Chart Analysis

Bitcoin broke out of its lengthy declining trend, rallying quickly up to the key $9000-$9200 zone as expected, even though the momentum of the move has been relatively weak, and the coin failed to enter the zone, with the lower resistance line halting the advance, for now. The currency should remain above the declining trendline, but another short-term consolidation phase could be ahead as altcoins are likely entering a correction. Further resistance is ahead at $10,000 and $10,500 while support is found near $8400 and $7800.

ETH/USD, 4-Hour Chart Analysis

Ethereum hit the $625 level as we expected and it also broke out of its declining trend, after confirming a new short-term advance earlier on this week. Traders shouldn’t enter new positions here, as the coin is stretched from a short-term perspective, while investors could still add to their holdings on the pullbacks. Support is now found between $555 and $575, and below that zone at $500, while strong resistance is ahead between $625 and $645 and near $740.

Litecoin

LTC/USD, Daily Chart Analysis

Litecoin has been relatively weak throughout the rally, but it still managed to top $150 before entering a pullback. The coin should hold above the declining trendline during the correction, which could set up a test of the key $170-$180 zone. LTC faces further resistance at 4200 while support below $140 is at $125.

Dash

DASH/USD, 4-Hour Chart Analysis

Dash built up relative strength during the second phase of the rally this week, and the coin is in a clear short-term uptrend following the move, although a correction likely started today. The next main target is at $500 for the advance, with support found at $435, near $400, $375, and $360. Short-term traders should wait with entering new positions, while investors could still add to their holdings during the short-term pullbacks.

Ripple

XRP/USDT, 4-Hour Chart Analysis

Ripple also entered a short-term correction, pulling back to the vicinity of the key $0.84 level. The coin is clearly overbought form a short-term perspective, but the long-term picture is still favorable so investors could add to their holdings when the overbought reading gets cleared. Key support is found at $0.73, and $0.68, while resistance is head at $1.

Ethereum Classic

ETC/USD, 4-Hour Chart Analysis

Ethereum Classic caught up with the broader market in the latest leg higher, touching the $20 level, before the pullback after leaving behind the declining trendline and confirming a short-term uptrend. While the crucial $23 level is still ahead as strong, we expect the really to continue after the current correction, with support levels found at $18, $16 and near $14.50.

Monero

XMR/USD, 4-Hour Chart Analysis

Monero capitalized on its very strong long-term technical position and rocketed higher after establishing a new short-term uptrend this week. The coin almost reached $280 before pulling back, rallying past the key $240 level. Short-term traders should expect a corrective phase after the rally, but long-term investors should still be looking for entry points, as the setup is still favorable. Above the $280 level, the next target is at $300, while crucial support is found at $200.

NEO

NEO/USDT, 4-Hour Chart Analysis

NEO’s advance stopped right at the $80 resistance level with the dominant declining trendline also holding back the coin right in that area. The coin will likely correct together with the broader market, so short-term traders should wait before entering new positions. Primary support is at $0.64 while the next target is ahead at $100.

IOTA

IOTA/USD, 4-Hour Chart Analysis

IOTA touched the $2 level surpassing our target at $1.9, as it remained relatively strong throughout the upswing. The coin is clearly overbought form a short-term perspective, and even a test of the $1.5 level is possible after the surge. That said, investors should hold on to their positions, while traders should wait until the overbought readings are cleared. Support below $1.5 is at $1.2, while the next major resistance zone is near the $2.2 level.

EOS

EOS/USD, 4-Hour Chart Analysis

EOS broke out to new rally highs a bit later than the rest of the market, and topped out just below the $12 level. The coin could be ready for a longer consolidation phase, with the long-term setup now getting slightly stretched. Long-term investors should only hold on to their positions, while traders should wait with entering new trades, with support found in the area around $9 and just below $8.

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.

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.
Comments
  • The article states that for NEO — Primary support is at $0.64. That’s a heck of a long drop to support. If NEO drops down to 64 cents, I’m buying several thousand units given that the target at the upper end is $100. I’m guessing that’s a typo and the author meant $64, but to be honest, I’ve seen several similar errors like this as of late.

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