Bitcoin and its peers have been in selloff mode lately, but it looks like near-term support areas are holding. Could they still rally before the end of the year?
Bitcoin has formed lower highs and slightly lower lows to consolidate inside a falling wedge pattern visible on the daily time frame. Price tumbled recently but support continues to hold, and stochastic seems to be suggesting that a bounce back to the resistance around $8,000 might follow.
However, the 100 SMA remains below the slower-moving 200 SMA to indicate that support is more likely to break than to hold. In that case, bitcoin might be in for a steeper slide that’s roughly the same height as the wedge formation.
Ethereum continues to cruise lower inside its falling channel on the daily time frame, but it looks like bulls are defending the support level. Stochastic is indicating exhaustion among buyers and turning higher could spur a pullback.
The handy-dandy Fibonacci retracement tool shows that the 38.2% level lines up with the mid-channel area of interest while the 61.8% Fib is closer to the channel top at $164. This also coincides with the 100 SMA dynamic inflection point, which is below the 200 SMA to confirm that the downtrend is likely to carry on.
Litecoin is also trending lower on its daily time frame and is right smack in the middle of its descending channel, still deciding whether to pull back up to the top or continue its slide to the bottom.
Stochastic has been indicating oversold conditions for quite some time and is starting to pull up, possibly showing that buyers might return and spur a correction. Still, the 100 SMA remains below the 200 SMA to signal that the selloff is more likely to resume than to reverse.
XRP is in correction mode as it bounced off the lows at 0.1760 while stochastic is pulling up to signal a return in bullish pressure. Price could retreat to the descending trend line that coincides with the 61.8% Fibonacci retracement level.
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!