An overnight spike in Bitcoin made headlines in the cryptocurrency segment today, as the largest coin unexpectedly surged past the $6750 level. The coin is now back to pre-spike levels and BTC’s rally wasn’t enough to trigger a broad move in the other top coins, and that once again confirmed the strong selling pressure on altcoins. With most of the coins stuck in downtrends, bulls still face a huge mountain to climb before a trend change, and traders should still remain on the sidelines.
With still no signs of a developing bullish leadership, a test of last week’s lows seems likely in the case of most of the majors, while Bitcoin still looks ready to test the long-term support zone near $5850, even as it remains in a much better shape from a long-term technical perspective. On another negative note, the relatively weak coins that led the selloff in recent months are still underperforming again after the weekend bounce, raising the risk of another leg lower in the trend.
BTC/USD, 4-Hour Chart Analysis
Bitcoin exited its narrow trading range briefly thanks to the overnight spike, but now the coin is back in the $6275-$6500 interval that has been in play for several days now. The fact, that BTC couldn’t hold on to the gains is a bearish sign, and although our trend model is still neutral short-term, odds favor a move towards $6000 in the coming days. Further resistance is ahead at $6750, while support is found at $6000 and $5850.
ETH/USD, 4-Hour Chart Analysis
Ethereum is back on a short-term sell signal after showing weakness today yet again and falling back below the $280 level and challenging the $275 support. We expect a test of the lows near $260 as soon as the coming days, and with the downtrend clearly being intact traders should still not open new positions in the coin. Further support is found at $235, while strong resistance is ahead at $300 and $335.
Altcoins in Bearish Setups Across the Board
XMR/USD, 4-Hour Chart Analysis
While Monero was among the coins that led the oversold bounce after being weak for several months, it is now looking bearish again, with the dominant declining trendline capping the rally attempts. The coin is expected to test the $80 level in the coming weeks, and a successful test would be a positive sign for the whole segment. Litecoin, NEO, IOTA, and especially Dash are also showing weakness today, and that reinforces our defensive stance towards the majors.
XRP/USDT, 4-Hour Chart Analysis
Ripple is still the only major on a short-term buy signal, and the coin is holding up above the $0.30-$0.32 zone despite the hostile environment. The third largest coin is still bearish from a longer-term perspective, and despite the short-term signal, a test of the lows is likely, even as a more durable bottom could already be in after the steep decline of the recent months.
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Disclaimer: The analyst owns cryptocurrencies. He holds investment positions in the coins, but doesn’t engage in short-term or day-trading, nor does he hold short positions on any of the coins.