Ethereum Blockchain Finds Another Use Case in Government Bonds


Sellers are back in full force in the cryptocurrency segment as Ripple retraced a large chunk of last week’s surge Monday in late trading. The coin dragged the whole market lower, with Bitcoin, Ethereum, and all of the major altcoins registering significant losses. The 5-10% decline and the almost 20% plunge of XRP hurt the total market cap of the coins badly, which fell by more than $15 billion off the weekend levels to around $210 billion.

The fact that most of the coins failed to extend the gains from last week, leaving the bearish long-term technical setups intact, is a negative for the coming weeks, with especially Bitcoin’s relative weakness being worrying for bulls. While there is still hope that a leadership might develop, with the likes of Monero Dash, Stellar, and Ripple being in short-term uptrends, given the long-term segment-wide downtrend, traders should still be cautious with new positions even in the technically stronger coins.

XRP/USDT, 4-Hour Chart Analysis

Ripple has already been testing the $0.42-$0.46 zone as we expected following the quiet weekend period, and volatility is expected to remain elevated, with the steep short-term uptrend line also being found near the current price level. The coin has to hold up above the key zone to confirm a longer-term trend change, but for now, the weakness in the rest of the market makes the move suspicious.

With that in mind, traders should still not enter full positions in the coin, even as the short-term overbought momentum readings are almost cleared. Further support below $0.42 is found near $0.3750 and $0.35, while resistance is ahead near $0.51, $0.54, and $0.57.

BTC/USD, 4-Hour Chart Analysis

Bitcoin fell back below $6500 amid the broad selloff, and the most valuable coin is close to the weak rising short-term trendline yet again. While a short-term sell signal hasn’t been triggered, a sustained move below $6275 would be a bearish sign and would make another test of the key long-term zone near $5850 likely again. Further resistance zones are now ahead near $6750 and $7000 while weaker support is also found near the $6000 price level.

Altcoins Still Mixed but Bulls Need to Show Strength Soon

ETH/USD, 4-Hour Chart Analysis

Ethereum failed to hold above the key $235 support/resistance level after reaching up to the zone near $260 during last week’s rally and the coin is close to triggering another short-term sell signal in our trend model. ETH is trading right at the short-term uptrend line, and with all the major declining trendlines being left intact by the rally, a move towards $200 is likely with a possible test of the bear market low near $170 as well.

LTC/USD, 4-Hour Chart Analysis

Litecoin remained relative weak during the rally, never triggering a buy signal, and the coin is now testing the $0.56 level and the weak short-term uptrend line as well. A clear move below those would mean a sell signal for LTC and with the long-term trend clearly being bearish, a dip below $50 would be likely afterwards. Further support is found near $51, while resistance is ahead near $59 and $64.

While some of the stronger coins are still showing stability as we mentioned above, the relatively weaker currencies haven’t been able to gather strength, and IOTA, NEO, Ethereum Classic, and EOS are still looking negative from a technical perspective.

IOT/USD, 4-Hour Chart Analysis

Although IOTA managed to avoid a test of the August lows, last week’s failed move makes a break below $0.50 likely in the coming weeks, as the steep long-term downtrend remains intact. A quick move above last week’s highs would be a bullish sign, but for now, sellers are still clearly in control of the market.

Featured image from Shutterstock

Disclaimer:  The analyst owns cryptocurrencies. He holds investment positions in the coins, but doesn’t engage in short-term or day-trading, nor does he hold short positions on any of the coins.

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