Following Tuesday, August 11th, downward price action that saw Bitcoin hit an intraday low of $11,127, it appeared that the selling pressure was going to spill over the next day. Indeed, the flagship cryptocurrency opened Wednesday, August 12th, at $11,392.64 and immediately began trending down. For the next six hours after the daily open, BTC took a 22% nosedive to reach $11,140.

When considering the swing low of the previous day, it seemed like Bitcoin was forming a double bottom pattern, based on its hourly chart. Traders who saw this technical reversal formation seem to have rushed to long the BTC/USD trading pair. The spike in demand around this support level was significant enough to push prices back up, confirming the “W” pattern.

As a result, the pioneer cryptocurrency shot up by 4.4% to hit an intraday high of $11,630 by 15:00. Such resistance level was met with a considerable number of sell orders from those who were trying to realize profits from the upswing. The mounting downward pressure caused prices to pull back before the uptrend resumed.

By 17:00 UTC, Bitcoin had retraced 1.35% and was hovering around the $11,470 support level. Given the strength of this price hurdle, BTC turned around and recovered some of the losses incurred. Prices were able to close the day at $11,568.37, with the bellwether cryptocurrency providing investors a daily return of 1.54%.

 

Ethereum Rebounds Sharply From Crucial Support Level

Like Bitcoin, the smart contracts giant also kicked off Wednesday’s session on a negative posture. Ethereum opened August 12th at a high of $379.34, and quickly prices started to drop. By 6:00 UTC, Ether had reached a low of $366.05, representing a 3.50% downswing from the daily open.

Regardless, the bulls seemed to have stepped in around this price level as ETH bounced back sharply. The second-largest cryptocurrency by market cap entered one of the most significant uptrends seen since the beginning of the week. Its price surged by 6.47% to an intraday high of $389.75.

By 20:00 UTC, it was clear that some investors were going to take profits after such an impressive rally eventually. As sell orders began to pile up in substantial amounts, Ethereum took a 1.78% nosedive a few hours before the end of the day. ETH then hit a low of $383.81 while sidelined investors were trying to get back into the market.

The spike in demand seen around this price level pushed prices back. Ethereum entered a new uptrend just two hours before the daily close that saw it rise by 1.23%. ETH was able to close the day at $387.51, providing investors a daily return of 2.15%.

 

Key Technical Index Flashes Sell Signals

Despite the upward price action seen on Wednesday, August 12th, things are not looking good from a macro-perspective. On Bitcoin and Ethereum's 3-day chart, for instance, the Tom Demark (TD) Sequential indicator presented a sell signal in the form of a green line candlestick. Following the bull rally that began in early July, combined with the recent rejection from the overhead resistance, it is very likely that the bearish formation will be validated.

If so, BTC and ETH may be poised to retrace for one to four three-day candlesticks before their respective uptrends resume. On their way down, the flagship cryptocurrency could find support around the $10,000 support level while the smart contracts giant would likely pull back towards $300. Sidelined investors might take advantage of an eventual correction to get back into the market.

It is worth mentioning that there is one way in which such a pessimistic scenario can be taken out of the question. If the two largest cryptocurrencies by market cap can turn their overhead resistance into support, the bearish outlook will likely be jeopardized. Bitcoin would have to move above $12,000 to aim for $14,000, while Ethereum would have to slice through the $400 hurdle in order to rise towards $500 or higher.

The above content is for informational purposes only. You should not construe any such information or other material as legal, tax, investment, financial, or other advice. The trading of commodities, cryptocurrencies and currencies involves significant risk. Prices can fluctuate on any given day. Because of such price fluctuations, you may gain or lose the value of your assets at any given moment. A cryptocurrency/currency may be subject to large swings in value and may even become absolutely worthless. There is always an inherent risk that losses will occur as a result of buying, selling or trading anything on the market. Cryptocurrency trading has specific risks, which are not shared with other official currencies, goods or commodities in a market. Every user has to carefully assess whether his/her financial situation and tolerance for risk is suitable for buying/selling/trading cryptocurrency.

Cryptos feed

Latest Crypto News


Latest Crypto News & Analysis

Editors’ Picks

Top 3 Coins Price Prediction: BTC upside capped at $11,600

Twitter and Square CEO Jack Dorsey has yet again reinstated his support for Bitcoin. Bitcoin options open interest is hovering at around 134,000 contracts. Crypto Bitlord accused Ripple of not doing anything to improve ...

More Bitcoin News

Neo Market Update: NEO charts yearly highs, as it readies for DeFi

The new Neo update increases the overall block size limit and improves overall network health. The 4-hour NEO chart has formed the head and shoulders pattern. The Neo Global Development (NGD) has ...

More NEO News

VeChain Price Analysis: VET looking to re-test $0.017 in the short-term

VET is currently trading at $0.0147 after a notable bounce from its low in September at $0.01. VET price is facing some resistance in the form of the 12-EMA at $0.0148. VeChain had a steep correction after its peak on August 7, and it’s ...

More VeChain news

Palm Beach Confidential releases new report highlighting Maker, Enjin Coin, and Numeraire

The newest confidential release from Palm Beach includes several coins like Maker, Enjin, and Numeraire. The company has been giving picks to investors for years now.

More Cryptocurrencies News

BEST CRYPTO BROKERS/EXCHANGES

Bitcoin Weekly Forecast: BTC crystal ball gives bulls a faint flicker of hope

Bitcoin staged a healthy recovery this week. The pioneer digital currency price took off from the support area of $10,000 and touched the next psychological line of $11,000.

Read the weekly forecast

BTC

ETH

XRP