Most of the cryptocurrencies were weakening throughout the whole trading week after promising bullish run last weekend. Several crucial technical resistance levels held the price action from further achievements on the upside, pointing to bear market continuation in the nearest future. The crypto bears stepped in with heavy-volume sell pressure last Monday, pushing coins back to the ranges seen in late December 2018. Etherium and Bitcoin Cash were leading the losses with -23.86% and -23.44% 7-days change respectively. Litecoin also failed to hold the previous gains slightly below the important round-figure price of $40, dropping 20.23% to the weekly lowest price around $30. EOS was also among the losers this past week. Bitcoin, Ripple and Stellar suffered moderate slide around 11%, while to cryptocurrencies showed signs of some optimism - TRON (+3.42%) and Tether (-0.11%). Ripple managed to jump into the second place in the market cap ($13.34B), tight after traditional leader - Bitcoin ($62.66B). Etherium remained on the third place with the market cap $12.39B. Tether surprised crypto traders with latest 24-hours volume, booking the second place with the $3.65B result (23.80%). Bitcoin ($4.85B, 31.64%) and Etherium ($2.38B, 15.51%) were in demand as well. Recent volatility underlines the market uncertainty with downside risks still on the table. Moreover, some of the cryptocurrency might accelerate the bearish slide, losing the ground and here is why.
The most popular cryptocurrency charted the bullish retracement (January 6) on the daily chart below, testing multiple resistance levels slightly above $4200.0. The weekly-high range of $4197.0/4218.0 represents a strong bearish defensive line, with attractive prices to renew speculative short positions. The exponential moving average with 50-days period is coming right there, working as crucial resistance. The latest market sell-off also started after the bulls failed to lift prices above SMA50 on November 14, so this week’s price action might signal another wave of Bitcoin’s plunge. Additional technical tools such as MACD indicator and Relative Strength (RSI) oscillator point are in the negative territory as well. First, MACD lines worked out the bullish divergence but did not go far above the zero level and even crossed each other, a bearish continuation scenario. The MACD histogram turned negative. RSI oscillator with a modified period of 13 days fell below 50% level, indicating the weakness of BTC/USD in the upcoming several days. In addition, the sequence of lower highs points to the downtrend to persist. The bears would try to test the market bottom around $3215.2 charted on December 15. If breached, an acceleration of the decline would take place, as the last time this price was noticed in September 2017. The sell-highs trading strategy is preferable.
Etherium retraced to 78.6% Fibonacci level of the downtrend which started on July 2018. The price range of $167.00/168.50 works as the resistance since it’s been breached on November 19. It’s also been working as the support during the bullish correction after Etherium found a local bottom on September 12. Sunday’s bearish acceleration helped bears to push the price to the lowest rates since December 22, breaking through the horizontal static support at $118.57 and closing the day slightly below that level at $117.94. ETH/USD is vulnerable to further decline as the bullish retracement was deep enough to continue the downtrend and consecutive lower lows are already charted. The nearest target is the market bottom noticed on December 14 - $83.67. Given the speed of two daily sell-offs on Thursday and Saturday, the bears would get Etherium there sooner rather than later.
The importance of $38/40 price range cannot be underestimated for Litecoin as several technical tools point to multiple resistance here: 89-days simple moving average (green curve on the daily chart below), Ichimoku Cloud’s upper line of the range and psychological round figure of $40.00. The bullish momentum exhausted on January 5-8 and sellers took the market under control. LTC/USD faild to consolidate losses near Ichimoku conversion line, falling to the lower range of the span. Despite the bullish cross on the Ichimoku Cloud trend indicator, the price remains in the uncertain territory inside the span with downside risk still in play. Once Litecoin daily close price appeared below the span ($30.18.95 currently), the door will be open for further bearish achievements at $28.68 (December 27 close) and $23.47 (local bottom) in extension. An upside spike is possible though, which has to be considered for fresh short positions. An attractive price range for such an aggressive trading approach is placed in the range of $35.22/36.20 where both Ichimoku resistance lines are coming. Conservative traders should wait for a more clear signal, monitoring the direction on which LTC/USD will get out of the span. Nevertheless, further selling pressure is more likely.
Ripple is vulnerable to more losses in the upcoming week and here is why. The bulls failed to hold the gains above $0.4000 round figure, leaving just a long shadow on the daily candlestick on January 10. Parabolic SAR is well above the current price, signalling a bearish trend in play. Awesome Oscillator is below the zero level with its bars having the red colour, pointing to a continuous bearish momentum. The overall graphical pattern represents a decscending triangle with a horizontal base at $0.2633 (lowest daily close on September 11). The nearest support is represented by a long-term descending median line which connects high levels from May 2018 and September 21. That line worked as the support on November 14 and December 27, however, it still attracting daily average prices, so a possible test of $0.3000 is very likely in the nearest days.
TRON remained in the same long-term sideways range, however, it was the only gaining cryptocurrency among majors. The long upside whipsaw on the daily candlestick represents strong resistance around $0.035 level, and TRX/USD dropped after the failed test. However, the latest bullish bounce might point to further upside pressure. Williams %R oscillator (13 days period) bounced off the oversold level rapidly, while Bollinger Bands %B indicator (34 days) did not even reach 50% level, confirming the heavy-volume demand for TRON slightly above $0.020. TRON bulls need to chart a sustainable break above $0.030 level in order to complete the bullish breakthrough pattern and start a long-term uptrend. Until then, the coin will remain under the selling pressure. Williams %R has to be monitored in its overbought range in order to assess the bullish strength.