Bitcoin & Ethereum: cracks in the rally
The upward pressure in Bitcoin and Ethereum has eased somewhat; so far the recent retreat appears to be a consolidation within the broader uptrend and what are the key levels to watch?
The fall in Bitcoin and Ethereum below the last month’s low suggests that cracks have emerged in the multi-week rally.
So far, cryptocurrencies have been holding above key support levels, but unless upward momentum to picks up the downside risks are unlikely to dissipate.
BTC/USD monthly chart
Bitcoin: Consolidation within the uptrend
The broader trend in BTC/USD remains bullish, notwithstanding the recent consolidation, as the colour-coded candlestick charts based on trending/momentum indicators show.
BTC/USD daily chart*
Importantly, Bitcoin has been holding above a crucial cushion around 25300-26000 (including the 89-day moving average and the February 2023 high).
BTC/USD daily chart
To be fair, the hold above the support recently is not a guarantee that the retreat is over. Unless the psychological 30000 is crossed decisively, the retest of the 25300-26000 area can’t be ruled out.
ETH/USD daily chart*
Ethereum: early-May high is tough bar to cross
Like Bitcoin, ETH/USD’s broader outlook has been bullish. However, ETH/USD’s close last week below horizontal trendline support at about 1780 is a sign that the upward pressure is fading. Still, it is holding above the February highs of 1710-1740 (including the 89-day moving average).
Any break below 1710-1740 could expose downside risks toward the 200-day moving average (now at about 1560). On the upside, for the upward pressure to fade, ETH/USD needs to break above the May 6 high of 2019.
ETH/USD daily chart
*Note: In the above colour-coded candlestick charts, blue candles represent a Bullish phase. Red candles represent a Bearish phase. Grey candles serve as Consolidation phases (within a Bullish or a Bearish phase), but sometimes they tend to form at the end of a trend. Note: Candle colors are not predictive – they merely state what the current trend is. Indeed, the candle color can change in the next bar. False patterns can occur around the 200-period moving average, or around a support/resistance and/or in sideways/choppy market. The author does not guarantee the accuracy of the information. Past performance is not indicative of future performance. Users of the information do so at their own risk.
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