Bitcoin (BTC/USD), Ethereum (ETH/USD) Forecasts: Pause or Pullback?
- Bitcoin and Ethereum are both recovering from the early-summer slumps that enveloped the crypto market.
- Despite continued crackdowns, both Bitcoin and Ether hit fresh two-month-highs recently.
- The analysis contained in article relies on price action and chart formations. To learn more about price action or chart patterns, check out our DailyFX Education section.
Crypto markets continue to come back with both Bitcoin and Ethereum having recently punched up to fresh two-month-highs. Each is working with a bit of resistance that’s held those advances at bay, at least for now, but it does beg the question as to whether we’re at the forefront of another strong topside run.
Starting with Bitcoin: The cryptocurrency caught a very strong bid on the back of the Elon Musk-Jack Dorsey discussion on the topic. The most essential takeaway, at least in my opinion, is how both seemed to take on a bullish tone while alluding to the fact that they’re not planning on selling any of their holdings. Dorsey has already said that Bitcoin is the most important thing that he thinks he will ever work on, and that’s a big statement for a person that’s currently the CEO at two publicly traded companies.
That’s helped Bitcoin to continue its recovery after testing below the 30k handle just two weeks ago. Prices have continued to rally up to fresh two-month-highs, eventually running into resistance as taken from a bearish trendline produced by swing-highs in April and May of this year.
Bitcoin Daily Price Chart
Bitcoin: The Look for Support
The big question now is whether buyers will step in to offer support, which could keep the door open for bullish scenarios, looking for prices to push up to yet another fresh two-month-high. There’s a prior spot of resistance-turned-support nearby, plotted around 36,623; and below that is another prior swing that could offer support potential at 34,635, which lines up very near the 35k psychological level. A bit lower brings 32,101 into view, and this could be looked at as an ‘s3’ area of support for longer-term, bigger picture outlooks in Bitcoin.
Bitcoin Four-Hour Price Chart
Ethereum Rally Rolls On
The recovery theme in Ethereum has been perhaps even more impressive than what’s shown in Bitcoin, particularly if we’re considering this recent pullback.
Similarly, Ethereum tested a big support zone multiple times over the past couple of months. In Ether, this space is lodged between two Fibonacci levels. And also like Bitcoin, Ether has went into a strong bullish trend over the past two weeks as prices have driven up to fresh two-month-highs, and the resistance coming in here emanates from the same Fibo retracement that’s helping to set support. It’s the 50% marker of that same move that’s currently defining resistance.
Ethereum Daily Price Chart
On the below four-hour chart, I look at three different areas of possible support for Ethereum, the nearest of which is currently in-play as buyers attempt to hold the lows. The next big spot come from the 61.8% Fibonacci retracement of the same major move that we’ve been discussing, and spans down to a price action swing around 2,192. And as an ‘s3’ level, I’m looking at another price action swing around 2040.
Ethereum Four-Hour Price Chart
--- Written by James Stanley, Senior Strategist for DailyFX.com
Contact and follow James on Twitter: @JStanleyFX
DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.