The cryptocurrency segment continues to be relatively quiet, with the counter-trend rally still being intact in the market of the top coins. While Ethereum attempted a move to new correction highs in the past 24 hours, the relatively strong coin failed to break out substantially and retreated in the second half of the day.
Despite the failed move, ETH and the other, relatively weaker majors are all stable, and the key support levels are in no danger. Volatility and correlations remain low, and odds still favor the continuation of the counter-trend move, even as the long-term picture remains overwhelmingly bearish in the segment, and a test of the bear market lows is still likely in the coming months.
On a negative note, we haven’t seen signs of bullish rotation in the market, meaning that the relatively weaker top coins, such as Ripple and Bitcoin continue to lag the leaders, and even the leaders are far from breaking the longer-term trends. With that in mind, traders should still only consider short-term positions with strict risk management rules.
BTC/USD, 4-Hour Chart Analysis
The technical setup in Bitcoin’s market is unchanged, with the coin still being stuck below the $4000-$4050 resistance zone, while being clearly above the $3600 support. While the short-term buy signal is still in place in our trend model, barring a move above the short-term range, traders should focus on the leaders of the move, as BTC is still weak from a short-term perspective. Further resistance is ahead between $5000 and $5050, while support below $3600 is found near $3250 and $3000.
ETH/USD, 4-Hour Chart Analysis
Ethereum established a short-term swing low near $145 following another failed rally attempt, and although the coin faces strong resistance near $160, the coin’s short-term relative strength is still encouraging for bulls here. The short-term uptrend is clearly intact, and our trend model remains on a short-term buy signal, even as the steep long-term downtrend is still dominant.
A move above $160 could open up the way for a test of the $180 level, with another level found above that near $200, but given the extent of the counter-trend rally, above $180, even short-term positions would become risky. Below the initial short-term level, support zones are still found near $130, $120, and between $95 and $100.
Declining Volatility Across the Board
XRP/USDT, 4-Hour Chart Analysis
Ripple dipped below the $0.3550 support level, triggering a downgrade to neutral in our trend model from a short-term perspective, and the coin remains among the weakest majors. While a broad rally would likely lift the coin too, traders should remain cautious with opening new positions here, with the long-term setup being clearly bearish. Key long-term resistance is still ahead in the $0.42-$0.46 zone, with further levels at $0.3750 and $0.40, while support is now found near $0.32 and $0.30.
LTC/USD, 4-Hour Chart Analysis
While Litecoin continues to be weaker than earlier on during the counter-trend rally, it remained stable in the past few days, and it’s trading well above the $30-$30.50 support zone, with progressively declining volatility in the coin’s market.
We still expect the rally to continue in LTC, although given the bearish long-term trend, a move below primary support would trigger a sell signal in our trend model. Further support is found near $26, while key resistance zones are ahead near the $34.50 and $38 price levels.
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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.
