As the reader will likely be no doubt aware, the broad cryptocurrency complex has been up and down the hill and valley characterizing a potential bottom or a potential bear market bounce of dubious meaning over the past month.
Now, we have come to a critical moment of judgment.
Today, we will take a close look at the charts for Bitcoin (BTC) and Ethereum (ETH), gauging their relative position in the course of this adventure from the standpoint of an objective technical analyst. Our goal, as always, is to provide an unbiased and empirical analytic edge to augment your perspective.
Bitcoin (BTC)
Price Analysis
- High: $7143.6
- Low: $6938.9
- 24-Hour Volume: $3.71B
- 7-day Percent Change: -12.5%
Bitcoin (BTC) has no doubt been the leader for the large market cap coins during the past month of significantly more promising action for those with exposure to that space.
However, over the weekend, we saw a clear dive to shake out the weak hands involved in the bounce, and trigger some very important tests of support. Chief among these tests, we currently see a very live and very current battle for the crucial 50-day simple moving average.
At this point, while support has been holding – and support that includes the $7000 level – we’re hardly out of the woods yet.
First off, the hourly MACD is already rising above the bullish inflection threshold with a histogram reading in “full bull mode”. However, this is a divergence, as Bitcoin (BTC) has barely bounced at all. Generally speaking, this is a bit of a warning sign, though not a conclusive one. In fact, we would prefer to see a bounce like this still registering somewhat oversold levels on oscillators.
In other words, the oscillators can function as something like a turbo boost for the bounce. However, with the bounce just in its infancy, we already have that turbo boost engaged. It would be better if that boost were still in the chart’s “pocket”, as it were.
The first important test on the upside will be at the $7250 level, which could come up on us pretty quickly.
Ethereum (ETH)
Price Analysis
- High: $413.4
- Low: $406.09
- 24-Hour Volume: $1.38B
- 7-day Percent Change: -10.89%
As we noted in our recent analysis, Ethereum (ETH) has been sharply underperforming many of the other large market cap coins in recent action, at least relative to its positioning on the charts in late June.
In fact, Ethereum (ETH) is already undercutting the June lows, despite Bitcoin (BTC) remaining well above those same relative levels on the charts.
Classically, for the space as a whole, we would far prefer to see the leading edge technology solution – and frankly we see that as Ethereum (ETH) rather than Bitcoin (BTC) – leading the way over the course of the bounce that longs certainly hope represents a more important bullish inflection in the overall cyclical ebb and flow on the charts.
At this point, Ethereum (ETH) is finding strong support at the $400 level, and it could be interesting from an oscillator standpoint. First off, if we were to move higher from here, we would have in place a clear and almost striking bullish divergence where the 14-day RSI measure is concerned.
In addition, as the bounce is progressing, we are seeing not only an affirmation of support levels but a strong bullish signal from the hourly MACD indicator as well. This one will bear close watching.
Happy Trading~
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Disclaimer: This article should not be taken as, and is not intended to provide, investment advice. Global Coin Report and/or its affiliates, employees, writers, and subcontractors are cryptocurrency investors and from time to time may or may not have holdings in some of the coins or tokens they cover. Please conduct your own thorough research before investing in any cryptocurrency and read our full disclaimer.
Image courtesy of Pexels
Charts courtesy of tradingview.com
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