The cryptocurrency segment is having a relatively quiet session after two bearish and nervous days, with the major coins all being slightly higher in U.S. trading. The coins entered a short-term consolidation pattern after successfully avoiding another technical breakdown yesterday, but despite the current quit spell, no near technical progress has been made, and the short-term downtrends remain intact. The top coins are well below their recent breakdown levels, and only BTC is showing encouraging stability.
The smaller coins are in similar short-term patterns ahead of the weekend, and there is still no sign of a bullish leadership that could change the tide in the segment that is still dominated by sellers. The fact that BTC is still holding up above its crucial long-term support zone remains the only really positive sign here, and even though XRP spiked briefly higher yesterday, it failed to show bullish follow-through, and the other top coins are also under clear selling pressure.
Our trend model is on sell signal son both time-frames concerning all of the top coins, and traders should still not enter positions here even as in the markets of the oversold altcoins, a more substantial correction could be ahead.
BTC/USD, 4-Hour Chart Analysis
BTC showing signs of stability during yesterday’s failed breakdown, the most valuable coin climbed slightly higher today, recapturing the $9,500 level and promising with a possible retest of the $10,000 level that has been in focus for weeks. The weak bounce hasn’t changed the bearish outlook for the coin and the segment, in general, but should the top altcoins hold up above their lows over the weekend, BTC could lead the way higher in a more sustained bounce.
For now, another downswing is still more likely, and a move below $9,200 would be a negative sign for the whole market. Our trend model is still on sell signals on both time-frames, and below the initial zone near $9.200, further support zones are found near $8,400 and $8,200, while resistance zones are still ahead near $10,000, $11,300, and $13,000.
ETH/USD, 4-Hour Chart Analysis
ETH is trading in a narrow consolidation pattern just above yesterday’s low, but the coin is still well below the $180 level and the level of the recent breakdown. Although the coin is not currently threatening with a test of the key long-term $160 support level, it remains dangerously close to it, and it is still showing relative weakness compared to BTC, so downside risks remain high.
While ETH is oversold from a short-term momentum perspective, it remains very weak technically, and there is still no sign of a developing failed breakdown pattern that could be the bases of a sustained bounce. The coin is on sell signals on both time-frames in our trend model, and below the initial support zone near $160, the next major level is found at $145, while above the key long-term $180-$185 zone, resistance levels are ahead near $200 and $230.
Ripple Fails to Build Up Momentum as LTC Struggles Near $64
XRP/USD, 4-Hour Chart Analysis
Despite yesterday’s brief spike, Ripple continues to be under selling pressure, and it fell back below $0.26 yet again. The coin failed to join today’s weak rally attempt, and it’s while its well above its recent panic low, it’s not far off its recent breakdown level, especially in comparison to the other top altcoins. That said, form a long-term standpoint it’s still the weakest major, and the bear market will likely continue even if XRP enters into a more sustained consolidation.
XRP is still on sell signals on both time-frames in our trend model, and even in the case of a larger-scale bounce traders should stay away from it and focus on the relatively stronger coins. Initial support is still found near $0.23, while above the $0.26 level, strong resistance zones are ahead near $0.28, $0.30, and $0.32.
LTC/USD, 4-Hour Chart Analysis
While Litecoin is trading slightly higher today after bleeding lower yesterday and leading the way lower during the current downswing, it remains very far off the recent breakdown level. LTC is struggling to get back above the key support zone near $64, and due to its relative weakness, it’s still likely to continue the ongoing downtrend, even as a broader bounce in the segment is possible in the coming period.
Odds continue to favor another leg lower in the short-term downtrend, even considering the oversold momentum readings, and our trend model is still firmly on sell signals on both time frames. Below $64, the next major support zone is found near $56, while resistance zones are ahead near $75, between $85 and $90, and near $100.
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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.