Crypto Update: Bitcoin Price Hits $8400 before Pullback, Key Trendlines on Watch


The broad rally that started with Bitcoin’s surge on Thursday continued on Sunday after a brief consolidation period. Most of the majors hit new multi-week highs, before pulling back again today in early trading. Bitcoin touched the next major level of interest at $8400 before turning lower. Altcoins also posted marginal new highs, while reaching overbought short-term momentum readings thanks to the strong rally.

Most of the currencies are now in correction mode, and the coming week will be crucial, as a higher swing low followed by another leg higher would establish a new short-term uptrend. For now, the majority of the coins is still trading in broad declining trend channels, and despite the encouraging rally and the constructive long-term setup, buyers are still not yet in control of the market.

BTC/USD, 4-Hour Chart Analysis

BTC failed to tackle the strong resistance zone ahead, with the $8400 horizontal level being joined by the broad declining trendline currently near $8500. The MACD indicator is showing a short-term correction, with the support zone just above $7650 being in focus below $8000. In the case of a breakout, the $9000-$9200 zone is the next target, while further support is at $7300.

ETH/USD, 4-Hour Chart Analysis

Ethereum is also trading in a short-term correction, and today’s low volatility is a bullish sign, with the coin holding up above the $500 level for now. Even a test of the $450 support would be in line with a developing new trend, but a shallower correction is also in the cards, given the strong momentum of the initial move. Above the swing high at $535, further resistance zones are between $555 and $575 and near $625, while the declining trendline is at $600.

Leaders Pull Back but Breakout Not in Danger

While correlations are still relatively high between the majors, there are signs that a healthy leadership is developing, and the early leaders of the current rally are holding on to most of their gains. Also, several smaller coins are sporting gains amid the broad dip, with most notably Cardano being up by double digits.

IOT/USD, 4-Hour Chart Analysis

IOTA, NEO, Ripple, and EOS which were the percentage leaders of the rally among the majors are all trading in orderly corrective patterns, with EOS still being ahead of the rest of the market in the cycle. Besides ETH, these coins should be watched closely during the current dip, as they could be from a swing low ahead of the rest of the market.

Stay tuned for our detailed technical analysis later on today.

Featured image from Shutterstock

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.

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