- Bitcoin price is testing the neckline of an inverse head-and-shoulders pattern for the third time since March 16.
- Ethereum price is defending a significant support level on the 4-hour chart.
- Ripple price is forming a pennant on an intra-day basis.
Bitcoin and Ethereum dropped overnight as the Federal Reserve Chairman Powell offered a subdued take on cryptocurrencies at a conference yesterday. Adding to the weakness was a strong dollar and a drop in the 10-year treasury yield.
Bitcoin price bending, but not breaking
During March 22’s trading session, Bitcoin crashed below the lower trendline that dates back to March 16 and tested the head-and-shoulders bottom’s extended neckline at $54,620. It is the third test of this support level in the past week while registering the most oversold condition in over a month.
If the developing intra-day bounce gets traction, it will find resistance at the 100 SMA currently at $56,350, followed by the broken trendline, which coincides with the February high at $58,367. The 50 SMA has flipped lower, adding downward pressure on any rebound.
BTC/USD 4-hour chart
A close below March 23’s low at $53,000 on the 4-hour chart will prompt traders to wait for support at the 0.50 retracement level at $51,550. The next support materializes at the 0.618 Fibonacci retracement at $49,395.
Etherum price at a critical technical juncture
Like Bitcoin, Ethereum experienced a sharp decline on March 22 on a significant spike in volume compared to average volume. In fact, it was the highest volume on a 4-hour candlestick since February 25, generating the highest oversold reading since the February 23 crash low.
Ethereum found support at the intersection of the recent head-and-shoulders pattern and the 0.382 Fibonacci retracement level at $1,663. Despite the extreme oversold condition, the ongoing rebound has been corrective, not impulsive, indicating that traders are still not better buyers at these levels.
Considerable short-term resistance is at the 100 SMA at $1,793.32, followed by the right shoulder high at $1,869. A close above the right shoulder would confirm that the topping pattern has been voided.
ETH/USD 4-hour chart
A continuation of the sell-off should find support between the 0.50 retracement level at $1,585.28 and the 0.618 Fibonacci retracement level at $1,510.78. The price levels match an area of price congestion associated with the right shoulder of the head-and-shoulders bottom in late February and early March.
Ripple price preparing for another impulsive candlestick
Since mid-March, XRP has incrementally nudged higher, with a few notable positive candlesticks dispersed throughout the advance. Ripple still has the overhang of the ongoing SEC investigation, and it should caution traders from diving into heavy long positions.
Still, XRP price is anticipating an eventual positive resolution. Remember, price is generally looking out 6-8 months.
From a technical perspective, Ripple continues to look higher in the short-term as it is currently shaping a pennant pattern on the 4-hour chart. It is finding support on the lower trendline, and volume has substantially contracted as the pattern has developed, indicating another big candlestick is around the corner.
The first upside target is marked by the February 22 high at $0.650 and the December 17, 2020 high at $0.656, representing a 13% gain from the pennant breakout. An additional upside target is the February 1 high at $0.757.
XRP/USD 4-hour chart
Downside targets begin with the March 20 reversal high at $0.549, followed by the reversal high on March 16 at $0.521. The last essential support is the rising trendline from the March 15 low at $0.507 before heavy selling would commence.
Note: All information on this page is subject to change. The use of this website constitutes acceptance of our user agreement. Please read our privacy policy and legal disclaimer. Opinions expressed at FXstreet.com are those of the individual authors and do not necessarily represent the opinion of FXstreet.com or its management. Risk Disclosure: Trading foreign exchange on margin carries a high level of risk, and may not be suitable for all investors. The high degree of leverage can work against you as well as for you. Before deciding to invest in foreign exchange you should carefully consider your investment objectives, level of experience, and risk appetite. The possibility exists that you could sustain a loss of some or all of your initial investment and therefore you should not invest money that you cannot afford to lose. You should be aware of all the risks associated with foreign exchange trading, and seek advice from an independent financial advisor if you have any doubts.
Recommended Content
Editors’ Picks
Is Altcoin Season here as Bitcoin reaches a new all-time high?
Bitcoin reaches a new all-time high of $98,384 on Thursday, with altcoins following the suit. Reports highlight that the recent surge in altcoins was fueled by the victory of crypto-friendly candidate Donal Trump in the US presidential election.
Shanghai court confirms legal recognition of crypto ownership
A Shanghai court has confirmed that owning digital assets, including Bitcoin, is legal under Chinese law. Judge Sun Jie of the Shanghai Songjiang People’s Court shared this opinion through the WeChat account of the Shanghai High People’s Court.
BTC hits an all-time high above $97,850, inches away from the $100K mark
Bitcoin hit a new all-time high of $97,852 on Thursday, and the technical outlook suggests a possible continuation of the rally to $100,000. BTC futures have surged past the $100,000 price mark on Deribit, and Lookonchain data shows whales are accumulating.
Shiba Inu holders withdraw 1.67 trillion SHIB tokens from exchange
Shiba Inu trades slightly higher, around $0.000024, on Thursday after declining more than 5% the previous week. SHIB’s on-chain metrics project a bullish outlook as holders accumulate recent dips, and dormant wallets are on the move, all pointing to a recovery in the cards.
Bitcoin: New high of $100K or correction to $78K?
Bitcoin surged to a new all-time high of $93,265 in the first half of the week, followed by a slight decline in the latter half. Reports highlight that Bitcoin’s current level is still not overvalued and could target levels above $100,000 in the coming weeks.
Best Forex Brokers with Low Spreads
VERIFIED Low spreads are crucial for reducing trading costs. Explore top Forex brokers offering competitive spreads and high leverage. Compare options for EUR/USD, GBP/USD, USD/JPY, and Gold.