Bitcoin/ US Dollar
The BTC/USD pair has continued its downward journey below its 50-day average and has now moved below $50,000. The bulls couldn’t hold a position above $50,000 where they have been since March, and consequently the pair’s dominance dropped by 50%. The pair is also dragging along a good number of altcoins with it including Ethereum and Binance Coin which were initially super resilient are looking like they are slowly developing a downtrend.
Despite the fact that this bearish will only instigate a majority of traders to sell, there are also a few bearish news that may be fueling the trend including the proposed increment of capital gains taxes in the United States by 19.6%, making the tax rate 39.6% for anyone earning over $1 million per annum. Such news could have easily scared a good number of traders into selling fast, this in turn congested the network, brought prices down and drove transaction fees up close to ATH back in 2017.
The news was strong enough to also have a bearing on the equity market which sold off on April 22, but this didn’t last for long as the market bounced back the next day. The question pressing on the minds of crypto traders at the moment would be how long this dip will last. Does the correction still have a longer way to go or is this the best time to resume buying the dip? Most analysts are calling it a momentary correction similar to what happened in 2013 and 2017.
If that is the case, then this fall is only stabilizing the growth and potentially transferring money from sellers in a panic sell frenzy and giving it to long-term holders. The only downside of this selling spree is how it jams up traffic on the network and pushes transaction fees up. As at Tuesday, an average transaction cost about $58, which is not far from where it was at $62 in December 2017.
BTC/USDT daily chart. Source: TradingView
The BTC/USD pair is currently trading well below its 50 day average (?) after failing to contain the bearish tendencies and turn resistance from 19th to 22nd April into support. The moving averages have completed bearish crossover and the RSI reading has gone below 30.
This is the first time it has sold below 40 since September 2020, and this could very well initiate a shift in the sentiment if the bears are able to sustain the price at this point and possibly bring it further down to around $43,000 which is the next critical level. At this point, buyers will step in with full force to try and contain the losses then create a rebound, but if the rebound isn’t strong enough, then the correction may not have ended just yet.
Whereas if the next phase of bullish is strong enough, there is still every indication of moving very close to the newly attained ATH.
Indicators
RSI has gone below 30, indicating that the pair is being “Over-sold” by a majority of traders in the meantime, but such positions are usually followed by a pump due to aggressive buying of the bulls. MACD is going deeper in the negative zone, even more than it did back in September 2020 when RSI went below 40. This is all indications that bears are momentarily holding the reins. However, no market moves in a straight line going up or down.
Ethereum/ US Dollar
The ETH/USD pair pumped back up through its new ATH within a few days of reaching it but has not been able to hold on longer than expected. The bulls on this pair are busy trying to build a resistance around $2,400 after falling below its 20 day moving average ($2,256.45) for a few hours yesterday.
ETH/USDT daily chart. Source: TradingView
For now, the bulls look to be in control, but sentiment might favour the bears especially when the pair starts approaching ATH. All indications show that bulls are buying on the dip and a majority might as well start selling at new highs. The test point will be between ATH and $2,500. If the bulls fail to hold this level once more then they might try resisting around $2,500 to $2,050 for the next few days after.
If the pair breaks out above this level, then they may just create enough momentum to resume the upward journey and possibly get to $3,000 to create new highs. This will only be possible provided the bulls keep buying and the bears don’t drag them below $2,000.
Indicators
RSI has pointed back upward over the past two days, going from 52 to 61 indicating a healthy amount of buyers still on the trend and trying to keep above the 20-day moving average ($2,256.45). MACD is in the negative area but not yet moving down strongly. This indicates a fluctuating power tussle between the bulls and the bears.
Ripple/ US Dollar
The Bulls on the XRP/USD pair have failed to bounce-off from the 20 day Moving average and have instead moved resistance a little bit deeper to $1.15, just above the 50 day moving average ($0.97). Inability to stay above $1.20 is indication that more traders are taking profit than those trying to buy the dip. The pair tested below $1 early today, and quickly sprung back up.
The market is active and most likely having a higher percentage of sellers. If the market maintains the current ratio of buyers to sellers the pair may be heading deeper.
XRP/USDT daily chart. Source: TradingView
The bulls have been doing a good job so far with buying the dip and staying within range, but the momentum will have to continue strong since the bulls are putting on a good show across markets. The climb back to the $1.20 range will be met with strong resistance but a good push from the bulls will take prices back around the $1.45 area and if they can keep it at that level, the bulls can take back charge. However, if it gets turned down from the 20 day average then the bears could plunge further down, below 50 day average and possibly settle around $0.56.
There is also a bearish trend forming with resistance along $1.15 on the pair’s 4-hour chart. This trend is forming close to the 50% Fibonacci retracement level of the decline from $1.42 to $0.90. An upward break from resistance should initiate an increase and probably get it to the next resistance around $1.30. Breaking from this next level, the pair could rally on towards $1.50 and above, whereas heading in an opposite direction may knock it below $0.85.
Indicators
RSI is at 50.93 and increasing, after gaining back its upward movement a day ago. Key support levels are around $1.05, $1.00 and $0.88 while Key resistance levels are $1.15 and $1.30. MACD chart is still in the negative area but not having a progressive decline. The bears seem to be greater, but the bulls are not backing down either.
Litecoin/ US Dollar
The LTC/USD pair slipped below its 20 day moving average ($246) on 23rd April, and dipped below its 50 day average on the 25th of April but quickly rebounded. The pair is still struggling to climb back up and the bulls are doing a pretty good job so far trying to reach and stay above the 38.2% Fibonacci retracement level at $270.12.
LTC/USDT daily chart. Source: TradingView
Today has been really bullish for the pair up to the time of writing, but not enough to cancel out the week's bearish decline. If the bulls could keep the momentum up to the 50% Fibonacci level ($283) then there is a good chance of reaching the 61.8% Fib level ($295).
Looking at the RSI readings and the candlesticks, the bulls may just have the upper hand momentarily but they will definitely want to take this further. If however the prices drop below $270, this positive projection will be cut short and this means sentiment is favouring the bears and another drop below the 50 day moving average may last longer below those levels.
Indicators
RSI has resumed an upward movement after dropping for 4 days and staying flat for the past 2 days. This indicates that the bulls are doing a good job with buying the dips and could very well keep the momentum. MACD is at -6.81 but declining from a stronger negative area. This is possibly a good sign for the bulls but for now they need to win at the resistance levels.
Bitcoin Cash/ US Dollar
Currently trading at $828 at the time of writing, the BCH/USD pair has been following a similar pattern with XRP and LTC over the past few days, including the drop and rebound at early hours of today. If they can successfully keep the price above this (50% Fib retracement) level for long enough, they could possibly rally above $1,050 before meeting further resistance.
Resistance will be stiff, but if the bulls push harder we could witness the pair going past the 52-week high ($1,216) that it set on 17th April.
BCH/USDT daily chart. Source: TradingView
Although the pair is having a bullish day, its current position around the 20-day moving average is a tricky one that is experiencing very high resistance. The pair already dropped for a brief moment to $716 but was immediately corrected in a few hours. This is an indication that the bulls are buying the dips and they will most likely want to continue.
If the trend is reversed however, the decline may be eyeing levels below its 20 day average and possibly deeper if it falls through the 61.8% Fibonacci level ($737.31) where it should create a support range. RSI readings remain in support of an upward trend as the least resistant direction.
Indicators
RSI is at 54 and seems to be keeping at north-east direction meaning that the bulls are gaining speed on the dip. MACD is still in the reds, but looks to be retracting over the past couple of hours meaning that the bulls are really putting up a struggle.
Correlations
- BTC/ETH: 0.84 (-0.06)
- BTC/XRP: 0.84 (+0.03)
- BTC/LTC: 0.87 (+0.04)
- BTC/BCH: 0.92 (+0.09) *Bracketed is a 7-day difference
The Crypto market has experienced a big shift from its jolly ride in the past few months. It got to an all new high after Coinbase went public on Nasdaq listing and slumped to $47,750, just below its 55-day lows, a few days after the frenzy. This “flash crash”, as it is called, was correctly called by many analysts and included in Remitano crypto forum posts released around that time. However, what nobody was able to foresee is if the bulls will be able to reverse these corrections while buying the dip. The BTC/USD and BCH/USD pairs will be looking to earn their first green candlesticks in 5(five) straight days, LTC/USD will be looking to earn its first in 9 (nine). All indications tell that a lot of buying is going on, if this can surpass the amount of selling, then the bull run will most likely resume soon especially with BTC/USD getting much closer to its 50 day average and the 20 day average taking a falter position.
Key Notes
- Bitcoin took a leap downward but bounced back above $50,000 aiming past its 50 day average.
- Ethereum is having another green day above its 20 day average and possibly a new ATH.
- Litecoin started an upward trend turning its 50 day average to support and currently trading at $243
- Ripple has fallen below $1 and risen to $1.25 in roughly 16 hours. Giving it a 24-hour R.O.I of +16% and a 7-day loss of -11.6%.
