Yesterday’s steep decline halted before a test of last week’s lows, but the largest digital currencies failed to bounce substantially, with most of them being stuck in narrow ranges today. Choppy trading conditions dominate the market of Bitcoin as well as the largest altcoins’, but with the downtrends in the segment still clearly being intact, a test of the lows is likely in the coming days.
The global regulatory crackdown on cryptocurrencies continues, this time with a strict purchase ban in India, and the coins showed signs of resilience today, but bulls would need much more to get excited about the short-term prospects and traders are still advised to be defensive, even as the long-term picture suggests a durable bottom soon.
BTC/USD, 4-Hour Chart Analysis
Bitcoin is trading near the lower boundary of the key is back in the key long-term support zone between $6750 and $7000, as it failed to get back above the $7000 level, despite recovering from the spikes below support. Last week’s low is found near $6425, and given the bearish cross by the short-term MACD, a test of that level is likely. Resistance levels above $7000 are ahead near $7300 and $7650.
ETH/USD, 4-Hour Chart Analysis
Ethereum is trading in a very similar pattern to BTC today, as correlations between the majors remain high. The coin is stuck in a steep downtrend, still on a short-term sell signal, and it is trapped below the key $400 level too. On a slightly positive note, ETH is not leading the way lower anymore, but is still no sign of the buyers taking control of the market. Support is found near the current price level, with further resistance ahead around $450, $500, and $625.
Altcoins Still Lack Leadership
The leaders of the recent bounce continue to be under pressure similarly to the broader market, meaning that there is still no clear leadership present in the segment. XRP is stuck below $0.50, while Litecoin and Monero, which are in better long-term shape, also gave back their gains.
Today, the only to 10 coin showing a meaningful plus is EOS that has been in a relatively quiet consolidation pattern amid the recent selloff. That said, this relative strength is not a reason to buy for short-term gains just yet, but when the trend finally changes, EOS could be among the leaders of the upswing, and long-term investors could add to their holdings here.
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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.