Bitcoin and its buddies chalked up even more losses in the previous week but are approaching inflection points that could spur a bounce.
Check out this ranking of bitcoin and its buddies for the past seven days:
Yikes! Altcoins sank much deeper into bearish territory, with litecoin chalking up the most losses and XRP able to trim it down to just a little over 3%.
Bitcoin could be in for a pullback from its ongoing slide as price is finding support at the bottom of its channel. Applying the Fibonacci retracement tool reveals that price appears to be finding resistance at the 38.2% level that lines up with the mid-channel area of interest.
A larger correction could take bitcoin up to the very top of the channel that lines up with the 61.8% Fib and $9,000 major psychological mark. This also coincides with the 100 SMA dynamic resistance, which is below the faster-moving 200 SMA to confirm that the downtrend is likely to carry on.
Ethereum is already bouncing off the bottom of its falling channel on the daily time frame and testing the 38.2% Fibonacci retracement level.
Stochastic is just making its way out of the overbought zone, though, so there’s room for a bigger pullback. The 61.8% level is closer to the channel top at $175-180, which is near the 100 SMA dynamic inflection point.
Litecoin continues to trend lower as it attempts to break below the mid-channel area of interest visible on its daily time frame. Price is down to the 61.8% Fibonacci extension and is setting its sights down to the full extension near the channel bottom.
The 100 SMA is below the 200 SMA to confirm that the path of least resistance is to the downside or that support is more likely to break than to hold. However, stochastic is starting to pull up from the overbought region to signal a return in bullish pressure.
Last but certainly not least is XRP, which looks ready for another wave lower as it forms a head and shoulders pattern on its short-term chart. A break below the neckline around .2200 could take price down by the same height as the reversal pattern.
Stochastic is already starting to turn lower, so price could follow as sellers take over. At the same time, the 100 SMA is about to make a bearish crossover to confirm the presence of selling pressure.
Just be warned, there is a considerable amount of risk in trading cryptocurrencies due to their inherent volatility and sensitivity to headlines. Be careful out there!