Many crypto bulls have struggled to breathe as the bears continue to come in great numbers and weigh heavily on the markets.
The crypto market on Thursday extended its losses as many major cryptocurrencies have struggled to reverse the downward momentum.
As Bitcoin struggles to barely stay afloat over the $19,000 level, the bulls did show a display of strength from the overnight challenge after inking in an intraday low of US$18,600.00.
Meanwhile, its counterpart Ethereum experienced a big drop, falling nearly -8% to US$997.00 before rebounding.
Meanwhile, based solely on technical analysis, Bitcoin (and other coins) could soon ‘bottom out’ as the broader assessment, mainly from the daily and weekly charts, point to a possible trend reversal.
The catalyst could be the markings from the US$19,000.00 challenge if viewed as a rejection, while Ethereum’s major support level views from US$936.00.
As a general principle, multiple timeframes lining up typically provide longer-lasting trend reversals, and we could be on the verge of seeing them all come together.
So, let’s take a look.
Based on the daily technical timeframe for Bitcoin, the Relative Strength Index (RSI) 3-period pattern has rebounded sharply out of the oversold region and eyes the (RSI) 50-midway point.
Meanwhile, the Moving Average Convergence Divergence (MACD) oscillator supports a weak positive bias, while the ADX (trend) indicator supports a weak bear trend.
We have to wait for the weekly close before assessing the pattern for the weekly assessment.
If the rejection from the key support area at US$19,000.00 is assessed as a potential bottom, we could then see the makings of a short-term recovery.
Viewing the topside, although there are many hurdles to clear to support any bullish call, a US$23,500.00 break would reveal the region of US$28.600.00. Reassess from there.
Conversely, ending in another ‘dead cat bounce’ could see the return to the challenge of US$19,000.00, which a New York close beneath this level would be devastating for the bulls as it may trigger a ‘Domino Effect’ for other crypto markets.
Based on the downward trajectory, it envisages a measured move to US$12,300.00. Reassess from there.
Daily Chart of Bitcoin
After a volatile session on Thursday, Ethereum continues to remain in “Uncertain Waters”.
That being said, one takeaway from the world’s second-largest cryptocurrency is that the key support level of US$936.00 remains intact.
Based on the technical assessment, the Relative Strength Index (RSI) 3-weekly ‘lookback’ indicator holds a bearish bias.
Meanwhile, the Moving Average Convergence Divergence (MACD) oscillator supports a negative signal while the ADX (trend) indicator now supports a ranging market (no trend).
Without a daily close beneath the US$936.00, the support level could save the bulls from a devastating fall to a measured downward trajectory of US$620.00. Reassess from there.
Conversely, a break of US$1,150 could potentially put the trend back into positive territory and support the call to the US$1,250. Reassess from there to the broader call.
Daily Chart of Ethereum
Binance, the cryptocurrency issued by the Binance exchange, also dodged the ‘bearish bullet’ after the downward challenge rejected the near the US$196.00 bearish trigger and ended posting a weak bullish Japanese hammer (mildly bullish).
Based on the technical pattern, the Relative Strength Index (RSI) 3-daily ‘lookback’ indicator, the pattern holds negative, while the Moving Average Convergence Divergence (MACD) oscillator is also, with the ADX (trend) indicator supporting a ranging market.
Viewing the topside, the resistance is assessed from US$226.00, with the US$232-33 trendline seen above. Reassess from there.
Conversely, while the market sustains above the US$US$196.00 to US$200.00, a key level, it should eventually see an improvement towards the bullish case.
Daily Chart of Binance
Although Cardano (ADA/USD) remains on vulnerable ground, one concept to takeaway is that the major challenge upon the support at US$0.42 was rejected.
Based on the Relative Strength Index (RSI) 3-daily ‘lookback’ indicator, at present, is negative, while at the same time, the Moving Average Convergence Divergence (MACD) supports a weak positive bias, and the ADX (trend) indicator supports a ranging market.
While the US$0.42 support is intact, overall, it keeps the market bulls in play for the challenge of the hurdle at US$0.62/US$0.63, which, if cleared, opens the path further towards the region of US$0.72 to US$0.77.
However, a decisive break of US$0.42 would be devastating for the bulls, as this could open the decline further into uncharted waters and give a measured move from a US$0.42 break to US$0.30-US0.33.
Daily Chart of Cardano