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.
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/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.
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.
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.
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/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/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/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.
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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.