Cryptocurrency market update: Bitcoin extends consolidation near $9,500
- Trading action in crypto market turns subdued following Saturday's selloff.
- Major cryptos struggle to make a meaningful recovery on Sunday.
- Bitcoin remains on track to end week below critical $10,000 mark.
The cryptocurrency market got hit by a strong selling wave on Saturday, forcing Bitcoin to erase more than $500 in a few minutes and pierce below the critical $10,000 mark. Following that selloff, major cryptocurrencies struggled to stage a recovery on Sunday amid thin trading volume and a lack of fresh drivers and are now moving sideways. Although some experts see news of the US Reports of the Internal Revenue Services sending letters to more than 10,000 crypto investors to urge them to report their crypto-related income properly as the driver behind Saturday's slump, there is market speculation about crypto whales trying to manipulate prices with an aim to reap large profits through trading on spot exchanges using leverage.
Top-3 coins price overview
Following yesterday's sharp fall, Bitcoin (BTC/USD) has gone into a consolidation phase and has been fluctuating in a very tight band near $9,500. As of writing, the BTC/USD pair was down only 0.2% on the day at $9,460. The pair could face the next strong support at $9000 (psychological level/Jul. 17 low/Fibonacci 78.6% retracement of June rally) and extend its slide if it makes a daily close below that level. On the other hand, a decisive recovery and the return of the bull market is likely to be seen if the pair reconquers $10,000 psychological mark.
After closing the previous day with a loss of 5.6%, Ethereum (ETH/USD) is struggling to determine its next short-term direction. At the moment, the ETH/USD pair is up 0.7% on the day at $208.65. $200 (psychological level) could be seen as the first technical support for the pair ahead of $190 (Jul. 16 low). Resistances are located at $225 (Saturday high) and $233 (20-DMA).
Ripple (XRP/USD), the third largest cryptocurrency with regards to total market capitalization, is down 0.5% on the day at $0.3080 and erasing nearly 7% since starting the week at $0.3305. The next support for the XRP/USD pair aligns at $0.3000 before $0.2825 (Jul. 16 low). The fact that the Relative Strength Index (RSI) on the daily chart is pushing lower below the 40 mark suggests that the pair could have a difficult time staging a rebound in the near-term. On the upside, $0.3240 aligns as the first technical resistance ahead of $0.3400 (Jul. 20 high).
Author
Eren Sengezer
FXStreet
As an economist at heart, Eren Sengezer specializes in the assessment of the short-term and long-term impacts of macroeconomic data, central bank policies and political developments on financial assets.
