- The increase in volatility can be positive in the medium term.
- Despite the strong falls, the bullish scenarios hold firm.
- Bounces are possible, but would only be confirmed with new highs.
This weekend has been rich in emotions for those who have crypto assets in their investment portfolio. On Saturday, BTC/USD managed to break the $4,000 barrier, and then on Sunday plummetted to $3,720 in just 15 minutes.
This kind of unexpected movements is common in markets that operate 24/7. The volume drops a lot over the weekend, and it is relatively easy to move the market in a specific direction.
Today, less experienced traders may feel frustration, worry or guilt. Please reject all those emotions! It is part of the game that these things can happen, and not even Warren Buffet himself can avoid these situations. Today, Omaha's Oracle will wake up (if he hasn't already done so) with more than $2 billion lost in his accounts after Kraft Heinz's price drop of more than 30%.
Among the three leaders by crypto board capitalization, the technical situation has not changed too much. The prices have gone to the bottom of the current scenario, but at the time of writing this article, they remain within it.
I consider any increase in price volatility to be positive. There is an infinite amount of resistance between the current price and Fibonacci's 50% setbacks from historical highs and an increase in volatility can make the trip much more accessible.
BTC/USD 240 Minute Chart
The BTC/USD pair is currently trading at the $3,770 price level. On Saturday it reached the $4,200 price congestion resistance level and turned dramatically lower. The minimum price of the sudden drop remains at the SMA100 level of $3,718. Even a bearish extension to the SMA200 level of $3,600 would be reasonable and within expectations.
Below the current price, the first support level for the BTC/USD pair is at $3,728 (SMA100), then at $3,689 (price congestion support) and as the main support at $3,600 (price congestion support, SMA200, and bear channel ceiling).
Above the current price, the first resistance level is at $3,851 (EMA50), while the second resistance level is at $3,900 (price congestion resistance) and the third at $4,040 (price congestion resistance).
The MACD on the 4-hour chart crosses a robust bearish trend although the slow moving average of the indicator holds positive and makes an immediate recovery possible.
The DMI on the 4-hour chart shows the bears strongly increasing activity as the bulls retreat while keeping the level above the 20 levels. There may be a bullish reaction.
ETH/USD 240 Minute Chart
The ETH/USD pair is currently trading at the $139.65 price level. Saturday was close to the $170 price level (price congestion resistance) and turned down to look for the SMA100 at the $133.19 price level.
Below the current price, the first support level for the ETH/USD pair is at $133.4 (SMA100). The second level of support is at $130.7 (price congestion support) and the third in the $120 range (SMA200 and price congestion support).
Above the current price, the first resistance level is at the price level of $142 (price congestion resistance), the second is at $150.5 (price congestion resistance), and the third is at $161.4 (price congestion resistance).
The MACD on the 4-hour chart shows an identical profile to that seen on the BTC/USD. The cross is bearish but with the possibility of a violent bullish turn.
The DMI on the 4-hour chart shows us how the bears came in strong on Saturday, but today they are not as convinced and are reducing positions. The bulls, on the other hand, lowered their activity sharply although they remain above the 20 levels. There is a potential for a possible bullish rebound.
XRP/USD 240 Minute Chart
The XRP/USD is currently trading at the $0.304 price level. It reached the $0.35 price level last week and was rejected downwards. On Saturday it tried again but failed, staying at $0.345, and strong sales sent it to the support level for the price congestion at $0.30.
Below the current price, the technical situation of the XRP is quite complicated. The first support level is $0.30 (price congestion support). The second support level is $0.293 (price congestion support), and the third support level is $0.288 (price congestion support).
Above the current price, the first resistance level is $0.308 (SMA200 and price congestion resistance). The second resistance level is set by the SMA100 at the price level of $0.31, while the third resistance level is at $0.317 (price congestion resistance).
The MACD on the 4-hour chart shows how in the case of the XRP, the bearish turn has moved both averages to harmful levels. It complicates a possible bullish turn and weakens development in the short term.
The DMI on the 4-hour chart shows how the bears take control on Saturday with considerable authority. The sellers put themselves above the ADX, something negative for the price, while the bulls withdraw although they remain above level 20, giving a little hope to the bullish side of the market.
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