The cryptocurrency market is back in the reading range that dominated last week’s price action, with the exception of a few coins, following yet another failed rally attempt that has been aborted by a sudden spike lower today. One of the positive outperformers is Ethereum, which is finally showing signs of relative strength after a grueling period of weakness, near a long-term make-or-break level.
While some analysts connect the selling to the harshest US sanctions targeted at Russia to date that has caused turmoil in related markets, technicals remain the dominant factor in the segment, with the downtrend still being intact, despite the bounce. That said, with the long-term picture suggesting a major bottom in the coming period, the current trading range could turn out to be part of a bottoming process, so short-term traders could look for a break above the key resistance levels for entry points. Until then, no new trading positions should be opened, while investors could still add to their holdings.
The most valuable coin failed to take out the declining trendline during the bounce, as it lost some of its relative strength lately. The coin is still on short-term sell signal in our trend model, with the $7000 and the $6750 levels being in focus, while the recent low near $6450 could be important in the coming days. Resistance levels above $7000 are still found near $7300 and $7650, with further support between $6150 and $6250, and near $5850.
Ethereum climbed back above $400 during the recent rally attempt, and now it’s trading near that crucial level, still in the vicinity of the break-out zone from December break-out. The coin is still in a clear downtrend, with only the steepest trendline being broken, but the short-term trend signal is now neutral, reflecting the relative strength of the coin. Support below $400 is found near $380, $360, and $325, while resistance ahead is around $450, $500, and $625.
Altcoins in the Red as NEO Outperforms
NEO joined Ethereum as the leader of the weekend bounce, even outperforming its closest peer percentage-wise. Neo also got hit by today’s selloff, as correlations are still high in the segment, but the coin remains above the recent lows, on a neutral short-term signal.
A clear leadership that could boost a broad rally is still missing, although a few small-cap coins, such as verge and Ontology remained stable today. As most of the majors are under clear selling pressure, with last week’s standout performers losing their relative strength, the short-term picture continues to be negative.
Stay tuned for our detailed technical analysis later on today.
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