Bitcoin / US Dollar
After hitting a new all-time high level during Sunday, reaching $58,000, Bitcoin’s price started to correct today. The minor correction lands around $53,800 to $54,000, indicating that the current correction stands below 10 %, which is always a normal reaction when the asset is on a “price discovery” phase. This period can be marked in the market after surpassing the $40,000 point when Tesla announced that it will buy $1.5 billion on Bitcoin.
After the $40,000 point, the situation was critical as the market needed another boost to establish the bullish market. The Tesla event brought the market to the new all-time high levels, breaking the $50,000 line and reaching the current all-time high level. At this moment, the price might correct even more as more and more investors will try to capitalize on their profits from the previous period.
The first and psychological support level will be the $50,000 point, which will be tested probably in the next few days if the correction continues to exist. The next support level lays around the $45,000 level, which was the first step of the price development after Tesla announced its decision for buying Bitcoin.
If those support levels work out and deliver what they are supposed to, we will return in the bullish paths much faster than we expect.
If the support levels break down in the future, we will observe a bearish trend that will probably stop around $30,000. The reason for this point is that many institutional investors have entered the market around those levels, creating sufficient market depth that will absorb any correction or bearish trend.
The $30,000 point is also a 45 % trace-back, which is an average return when the market is hitting a new all-time high level. The next days will reveal if the trend has changed in the market or this is something normal to happen.
The trading volumes have remained at low levels during the last period while the moving averages have remained on the same positioning, without been affected by the recent correction.
In the short-term diagram, we can observe that the corrective trend has not broken the bullish trending line, indicating that there is a need for a more bearish move to change the momentum in the market status.
Indicators
MACD index remained on the positive side, showing that the bearish trend has not been established while the RSI index returned on the “safe” zone, predicting a stable position for the next days.
Ethereum / US Dollar
After hitting a new all-time high level around $2,000, Ethereum started to correct also during today, landing just below $1,800. The current price levels are crucial for the market as it was the previous step for the price development before hitting the $2,000 point.
The first support level lays at $1,800, indicating that the next price support zone will be more strong at lower levels, around $1,100 and $1,400. Those levels will be strong enough to maintain relevant stability if the price continues to collapse over the next period. As we will see from the correlation table, Ethereum is heavily affected by Bitcoin’s market dynamics, preventing an independent movement in the current situation.
Those support levels were the entry point for institutional investors that wanted to diversify their crypto portfolios. The institutional moves established a larger market depth, preventing a steep decrease in the market development.
The trading volumes have been sustained at stable levels for now while the moving averages have moved close to each other, predicting a bearish cross if the downtrend is continuous.
Indicators
MACD index passed again in the negative zone, showing that the momentum is dropping in the market and many investors will be prevented from entering the market. The RSI index dropped to value = 55, indicating that there is still a possibility for returning in the bullish path.
Ripple / US Dollar
Ripple was the only asset today that didn’t drop but it surges from $0.50 to $0.57. The current price levels are familiar for the Ripple market as they were evident back in late December 2020. These price levels were the last stand before the price started to tremble down after SEC poses charges against Ripple’s founders for “illicit financing and financial fraud”.
If these levels are sustained at this moment, we expect a positive outcome. If the market dynamics went bearish in the next period, we believe that Ripple will follow them with a mild approach in the price formation. We believe that the last events made the price structure more fragile than in the past, bringing Ripple in the unfortunate position of losing the market cap in a few days.
The next days will harmonize Ripple with the rest of the market. Otherwise, we already have the week’s winner. The trading volumes have remained on the same level while the moving averages have come closer to each other, predicting a bearish cross if the market changes its way.
Indicators
MACD index followed its path on the negative side, confirming that there is not enough fuel in the market to drive the price higher. The RSI index moved at value = 60, a positive signal for future price development.
Litecoin / US Dollar
After flirting with its all-time high levels, Litecoin made a small correction today, landing at $210. The price has been sustained at high levels, indicating that the first support level in the market lays around $200.
If this level breaks down, the next minor support level lays at $180, where there was a previous local high level while there is a major support zone around $140, when the market will probably stop any bearish thoughts for the short-term future. We believe that Litecoin will follow any major trend in the crypto market, without any support from its fundamentals, making the market more unstable for the future.
The trading volumes have been sustained at higher levels than usual, showing that investors have flooded in the market and they are still interested in that as the moving averages have enough gap between them to form a change in the trend
Indicators
MACD index has fallen near the zero-line, showing that the momentum will slightly disappear from the market. On the other hand, the RSI index moved below value = 60, predicting stability in the market.
Bitcoin Cash / US Dollar
Bitcoin Cash made a break in the compression that was evident in the market during the last week, dropping around $650. This fall is minor, comparing to the price development that was evident during the last period but we are always thinking about the next steps in a potential bearish move.
The local high level around $600 could be the first minor support point while the support zone between $500 to $400 might be more strong in the price formation process. We expect that the price will adapt the Bitcoin’s trend characteristics to form the next period in its market.
The trading volumes have made some spikes during the last days while the moving averages have remained at positions far from each other.
Indicators
MACD index has fallen near the zero-line, showing that the momentum will slightly disappear from the market. . On the other hand, the RSI index moved below value = 60, predicting stability in the market.
Correlations
Bitcoin / Ethereum = 0.91 (- 0.01), Bitcoin / Ripple = 0.67 (- 0.09), Bitcoin / Litecoin = 0.91 (- 0.04), Bitcoin / Bitcoin Cash = 0.85 (- 0.04)
The correlations went down after the weekend all-time high levels for Bitcoin and today’s minor correction. Ethereum remained on the same spot as the previous period, indicating that the coin will probably follow Bitcoin’s trend in the next period.
Litecoin and Bitcoin Cash experienced a small trace-back in the correlation chart, indicating that their corrective moves were stronger than Bitcoin’s ones. All of the above-mentioned coins have sustained a strong correlation with the market leader. On the other hand, Ripple moved at lower positions, passing on the medium correlation sector.
This happened because Ripple is the only coin that is rising today. We will see for how long this contra move will work out in the market structure.
Key Notes For Today
- Bitcoin, after hitting a new all-time high level at $58,000, corrects at $54,000 today
- Ethereum, after hitting a new all-time high level at $2,000, corrects at $1,800 today
- Ripple was the exception and surges at $0.57
- Litecoin corrected at $210
- Bitcoin Cash corrected at $650
