The Recovery Brings the Compression Back

News • 2021/06/30 • by

Bitcoin / US Dollar

After hitting a local bottom twice during the last weeks at $31,500, Bitcoin’s price jumped again, reaching $36,000, which was the short-term goal for securing the first step for a successful recovery. Today, the price dropped at $34,800, posing a small trace-back from the compression line but this might be a corrective move that could last some hours or a day.

The most important part is that the price has managed to climb back in the compression point around $36,000, which means that the market has recovered from the fearing bearish trends and could focus on overcoming the difficulties of another compression trend.

The most common scenario, in this case, is that the market will bring another compression loop around $36,000 until there is another case or event that will bring the market to a higher level. The negative news from Elon Musk and China weren’t enough to bring Bitcoin at lower prices, showing that the market has developed enough depth to absorb negative vibes from the market.

The next goal for joining a bullish trend will be the $40,000 point, which was settled as the maximum point in the previous compression trend and practically was the entrance on this trend around mid-May. We expect that the $40,000 jump will become after pushing from specific events in the crypto market or an influencing person that want to take action in the field.

The trading volumes have been sustained at normal levels while the moving averages have still placed at bearish positions, bringing less positivity in the price formation.

In the short-term diagram, we can observe that the ups and downs during the last compression trend can range from $32,000 to $40,000, two points that need to be highlighted as breaking one or another will lead to a decisive push in the bullish or the bearish side.

Indicators

MACD index moved back again on the positive side, showing that there is positive momentum in the market, that could be capitalized on in the next few days. The RSI index has moved around value = 45, which means that the price will remain on the same spot for the next period.

Ethereum / US Dollar

A Bitcoin-like scenario was drafted in the Ethereum market as the price moved down to $1,850, creating a support level near the $1,750 point. The $1,750 point was the main compression point in the trend between February and April 2021 and this time acted as the major support level.

The price recovered above the $2,000 line, landing at $2,150 but there is more road to cover if the market wants to establish a bullish path again. Of course, the first goal would be to tackle the $2,500 point, which was the previous compression point. Once, this point is achieved, we should wait for building more depth and bullish perspective for achieving higher price levels around $2,800.

Above the $2,800 level, there is a price exploration phase where the price will bring more resistance and support levels. We expect a slow adaptation towards the $2,500 line, following Bitcoin’s example in the following days.
The trading volumes have returned in previous levels and the moving averages are positioned in bearish slots, waiting for the change in the trend.

Indicators

MACD index returned in the positive space, bringing more ambitions in the investing community about its short-term future. The RSI index moved to value = 45, showing that the market will remain stable in the next few days, with a small probability of going down.

Ripple / US Dollar

Ripple has experienced probably the worse correction in the recent period from all the altcoins, losing around 70 % of its value during the last 2 months. The price hit a bottom at $0.53 a week ago and now, it has climbed up to $0.67. The main goal for the current recovery period is to reach $1.00, which remained the major point for the previous trend.

As we can see from the diagram below, the $1.00 point was the entrance and the exit point for the bullish trend, showing that such a move will shake the market again with a positive outlook for the next stages. We expect that the climb towards the $1.00 point will be more difficult than expected as the investors know the market better than before, creating more skeptical positions about their investments.

The trading volumes have no difference with the past while the moving averages have been positioned in bearish seats, indicating that the market would take a turn in the next stage but it’s unclear when this would happen.

Indicators

MACD index returned in the positive field, like many other cryptocurrencies, indicating that the market is ready to take another boost and reach higher price levels. The RSI index moved around value = 40, indicating that the price could slip further at lower levels.

Litecoin / US Dollar

The major support level at $125 was held firmly in the Litecoin market and the market started to rise again, reaching $140, following the general trend in the market. Like the rest of the market, the compression trend was established around a certain price level. In Litecoin’s case, this level was established around $175 and this would be the next goal for the market as it grows.

The $175 point will become the next trend-setting point that will enable the market to reach the next goal at $200, which will become the new entry point for another bullish trend. We expect that the market will be in full correlation with Bitcoin’s moves, without any decline from the dynamics.

The trading volumes have made a return in the normal levels and the moving averages have been placed in the bearish position, showing that the market will continue on the same space for the next few days.

Indicators

MACD index returned in the positive lines, creating better vibes in the market regarding the short-term future while the RSI index moved between values 40 and 45, depicting a stable short-term future with potential negative outcomes.

Bitcoin Cash / US Dollar

The market stopped its fall at $450, creating a new bottom in the price formation. The price started to rise back to $510. The major support level at $550 didn’t manage to hold the bearish trend and the market collapsed at lower levels. The market recovery will pass from several points like the $550 point (the major support level) and $700 (the exit point from the bullish period).

Those two points will be our indicators if the market will enter the bullish phase again or it will remain at lower stages. As the market seems to follow Bitcoin’s dynamics, we believe that any move in the Bitcoin market will shape the future for Bitcoin Cash and the minor altcoins in the market. The expectations will follow also a slow adaptation towards the abovementioned points in the price diagram.

The trading volumes made small hiccups during the last days, indicating sudden interest from some investors while the moving averages have come closer to each other in the chart, but in bearish positioning.

Indicators

MACD index came back in the positive field, proving its correlation with the rest of the market. The RSI index moved between values 40 and 45, indicating that the price will move on the same space but with a negative outlook.

Correlations

Bitcoin / Ethereum = 0.96 (+ 0.40), Bitcoin / Ripple = 0.92 (+ 0.32), Bitcoin / Litecoin = 0.95 (+ 0.19), Bitcoin / Bitcoin Cash = 0.95 (+ 0.29)
The correlations skyrocketed since last week, proving that Bitcoin’s dominance in the market has been established again. As Bitcoin managed to climb back to the compression point around $36,000, its dynamic brought positive feed in the rest of the market, delivering positive results to other altcoins.

At this moment, every major altcoin (Ethereum, Ripple, Litecoin, and Bitcoin Cash) has established a strong correlation with Bitcoin. This means that the market will probably move in the same direction if there is another bullish wave in the short-term future. We expect that the compression will lead to a further increase in the correlation field in the next few days.