Bitcoin / US Dollar
Bitcoin's price made a strong correction yesterday, confirming our prediction in the previous articles for a decisive move that will shape the new era for the market. The decisive move became a reality and the price dropped to $31,000, creating a new trend in the market. The drop stopped above the $30,000 level, making a small rebound on the positive side, showing that the $30,000 level will hold firmly.
This trend is approved from two major facts that are shaping the current price formation. The first fact is an all-time high level is often followed by a steep correction, that could reach a 40 % drop in the next period. The 40 %, in this case, will be around $24,000 level, showing that the worst-case scenario will take place at a higher price level than the previous all-time high level at $20,000. The $24,000 price level is the first major support level in the Bitcoin market, which will bring more stability to the market if the price reaches these levels in the future.
The second fact in the market is that institutional investors have entered the market above the $30,000 level, indicating that the market has developed a larger market depth above this level. The large market depth shows that a corrective move will be absorbed from the market as investors won't be willing to liquidate their positions and will retain them, hoping for long-term profits after 5 or 10 years. The institutional investors have usually a longer investment horizon and they will not liquidate their positions in the first dump, creating a thick wall for any corrective moves.
The correction will be established in the next few days and we will observe how the support levels will work in this way. There is a small possibility for the market to grow back and rebound at the previous high levels, but this will establish a contrarian scenario in the market that we have to examine as a separate case.
The trading volumes have made a spike during the sell-off but returned to the same levels while the moving averages formed a reverse "Golden Cross", showing the reversal of the market trend to the bearish side. This signal is also a point for the bears that state that the market has changed.
In the short-term diagram, we can observe that the last 3 weeks have entered the symmetric triangle, a price compression period that ends up in the current price formation. The short period for the price compression would be a useful tool for our future analysis.
Indicators
MACD index continues to drop for 10 consecutive days, indicating that no momentum in the market could be used for a rebound at this moment. The RSI index dropped at value = 45, making the price stay in the same levels but with a negative outlook this time.
Ethereum / US Dollar
Ethereum reached its all-time high level of $1,400 and immediately corrected to $1,100, before surging to $1,200. This correction is not so steep as Bitcoin's correction but it shows that the market is still affected by external powers. The psychological barrier of $1,000 will be the most important role in the price formation as a new bearish trend as its break will make Ethereum follow the leading bearish trend while sustaining price levels above the $1,000 point will show that Ethereum can bring itself as an independent asset, that will function as an alternative investment option in the crypto market.
Ethereum will try to settle an independent trend from Bitcoin, to attract investors that want to diversify their portfolios and create contrarian positions, that will work on a rainy day. If the market depth is strong at price levels above $1,000, this scenario will become the best-case scenario and Ethereum investors will be awarded.
The trading volumes have surged during the last few days, indicating that Ethereum is gaining traction through its reaction in the crypto market. The moving averages have moved closer to each other, raising concerns among investors.
Indicators
MACD index passed again in the negative zone, indicating that the price will find difficulties in sustaining positive momentum in the market. The RSI index continues to stay in the positive zone, laying between values 55 and 60, making another point in the contrarian scenario.
Ripple / US Dollar
Ripple has tried to move its price in the last few days but the lack of liquidity in the market doesn't make this easy. The price is dropping during the last few days, landing at $0.27. The price range is extended from $0.20 to $0.30 and this will be the daily life for the next period, moving independently from the rest of the crypto market.
As long as the SEC charges are still underway, the price range will be a boring chart that will follow certain steps in its development. The next phase of Ripple will be determined from the fundamental elements that will be shaped by the SEC's decisions. If the decisions are positive, the price will take a surge for sure, allowing holders to gain more. The opposite scenario will bring more collapse in the price formation and bring more negativity in the market.
The trading volumes have been sustained at low levels while the moving averages will meet at a bearish formation, bringing more negativity in the market.
Indicators
MACD index has remained in the positive zone, making investors hope for another uptrend while the RSI index remained between values 40 and 45, indicating a negative turn in the market.
Litecoin / US Dollar
Litecoin made also a correction at $130 and it rebounded today in the $140 point. The negative trend has continued to establish its position in the market and the next steps will be held on that page. As we can see from the technical chart, a major support level in the market holds around $130, which worked this time while the next support levels lay around $100 - $110.
If those support levels break down, we will see a full bearish market that will make Litecoin's price decrease with easiness. The correlation with Bitcoin will determine how quickly this trend will be established and how quick the recovery will be.
The trading volumes have been sustained at normal levels while the moving averages have been constantly at bearish positioning, increasing the concerns for more correction this time.
Indicators
MACD index has remained on the negative field, indicating that the price will remain on the same trend for now. The RSI index remained around value = 50, indicating that the price will remain in the same position.
Bitcoin Cash / US Dollar
Bitcoin Cash made another correction in the market, following the market trend and its "sibling", Litecoin. The market was compressed around $500, which broke down and the price landed at $420 while it rebounded at $430 today.
The $400 point is a minor support level that could not hold forever while the majority of the market stays around $360 and $250. This space will give the market a gap to breathe if there is a more steep correction in the crypto market.
The trading volumes have been stabilized at a certain level, depicting a stable interest from investors while the moving averages will meet in the next days, creating another bearish signal.
Indicators
MACD index moved deeper in the negative zone, bringing more negativity in the market. The RSI index moved below value = 50, indicating that the market has passed in the negative zone.
Correlations
Bitcoin / Ethereum = 0.51 (- 0.25), Bitcoin / Ripple = 0.74 (- 0.09), Bitcoin / Litecoin = 0.65 (- 0.03), Bitcoin / Bitcoin Cash = 0.62 (- 0.09)
The correlations seem to decrease over the last few days, making the market less predictable and less integrated. This was evident during the previous days as every coin had a different behavior in the bearish correction that started from the Bitcoin market. Every single cryptocurrency in the market has been landed in the medium correlation zone, showing that the market has been reacting mildly at every move from the market leader, indicating that a bearish move in the next days will bring new standards in the market and the prices will form new price levels.
Key Notes For Today
Bitcoin dropped to $31,000 and rebounded to $31,700
Ethereum didn't correct so heavily, landing at $1,200
Ripple made a tiny correction at $0.27
Litecoin made a further correction to $130 before rebounding to $140
Bitcoin Cash corrected to $420 before rebounding to $430
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Remitano. Every investment and trading move involves risk, you should conduct your own research when making a decision.
