As traditional financial markets opened in Asian trading this morning, cryptocurrencies headed south yet again, as they did on most of recent Mondays. While this could very well be a coincidence, given the continuously growing futures BTC short positions, this could also be the result of banks and other financial institutions building up large bets against cryptos.
Whatever is the case, the ongoing BTC correction in the segment continues to dominate trading in the majors, and despite the weekend relative strength of some of the coins like Ethereum, Ethereum Classic, and NEO, a defensive approach is still warranted for traders, as volatility could spike higher.
Bitcoin Back Below $11,300
Although most of the coins are down by 5-10% from yesterday highs, Bitcoin and the rest of the largest coins are still trading well above the crash lows form two weeks ago. That said, the largest digital currency plunged below the key $11,300 support/resistance level today in early trading, which has been in the crosshairs of traders throughout last week.
BTC is in a clear short-term downtrend, and as the 4-Hour MACD is neutral and the coin is close to the weak line trendline that defined the post-crash bounce, a break-down is in the cards in the coming days. The currency might now be ready for a re-test of the lows near $9200, and a possible dip below that before the end of the current cycle, with strong support zones at $8200 and $7650.
BTC/USD, 4-Hour Chart Analysis
Ripple/USDT, 4-Hour Chart Analysis
Ethereum, ETC, and NEO led the weekend rally attempt, while Ripple also joined the party in late trading yesterday, but XRP gave back most of its gains this morning, falling back to the crucial $1.25 level amid the broad sell-off.
Ethereum is still pulling its weight, edging ever closer to BTC in market capitalization, as it remains the safe haven of choice, with Bitcoin still struggling to rally. The ETH token cleared the $1150 resistance during the weekend, and it is still trading right at that level despite today’s weakness, well clear of last weeks key $1000 level.
ETH/USD, 4-Hour Chart Analysis
For now, the decline didn’t change the technical picture for the majors, but a break below the key supports could quickly trigger another sell-off towards the crash lows, and even the relatively strong coins are risky here. Stay tuned for our detailed technical analysis later on today.