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Looking at the Ethereum (ETH) chart, you can start to see the negative news flow take a toll. In the two-day chart, Ethereum (ETH) is falling below the 21-period moving average (Figure 1). This configuration seems similar to the action just before the declines in July and November. In particular, small moves above the moving average, followed by a slow decline below it, eventually led to heavy sales.
Also the stochastic picture of Ethereum (ETH) and Ethereum (ETH) vs. BTC (ETHBTC) is negative.
In ETHBTC, the key level to look at is .0329 (Figure 2). This is the position of the 21-period moving average on the two-day chart. If ETHBTC falls below this level, Ethereum (ETH) could lose half its value compared to Bitcoin.
Both Litecoin (LTC) and Ethereum (ETH) are slipping below their 21-day moving averages in their two-day charts. That level is 32 (Figure 3). Stochastics are also decidedly negative. From now on, the technical configuration is similar to the one before the September decline. In the case of September, Litecoin (LTC) spent a bit of time above the average of 21 periods and then suffered a sharp decline once it fell back below it.
We also see evidence that the recent alts pump could be endangered. According to research from the crypt Twitterverse, the upcycle in the crypt begins with an increase in large coins (late December, early January). The pump then moves to high quality values, for example Tron (TRX). The final stage of the cycle is when the big moves take place in low quality alts. Perhaps Steem (STEEM) is an example of this type of alt.
Steem (STEEM) seems technically out of gas. Steem (STEEM) has moved to an area where there is a three-toothed resistance (Figure 4). Steem (STEEM) hit the 100-day moving average and the horizontal resistance that occurs in the retracement of 38% of its recent downward movement.
Bottom line: As the rally alt comes to an end, the downside risk in cryptography may be increasing. Any fundamental negative development in Ethereum has the potential to start a bigger decline. Said differently, the next big move in Ethereum (ETH) may require all cryptography.
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