Bitcoin, Ether, USD Talking Points
- Bitcoin prices plunge as risk sentiment sours, Ethereum and alt-coins follow suite
- USD benefits from safe-haven appeal as Russian troops enter Ukraine
- Technical levels provide support and resistance but geopolitics remain the primary driver of price action
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Russian Troops Invade Ukraine, Digital Assets Plunge
Confirmation of Russian troops entering the Kyiv region of Ukraine has sent risk assets tumbling in today’s trading session as investors flee to safe-haven currencies.
Despite efforts by Western leaders and Japan to prevent the invasion by imposing sanctions on Russia, Putin’s decision to proceed with the attack has cast a shadow of doubt over the crypto sphere.
At the time of writing, Bitcoin prices have plunged by approximately 6% while XRP, Cardano (ADA) and MATIC decline by double digits. Meanwhile, ETH/USD is testing a critical level of support at around $2,293, the 38.2% Fibonacci level of the 2021 move.
Bitcoin (BTC/USD) Technical Analysis
Bitcoin prices have continued to slide as the current geopolitical backdrop weighs on risk sentiment.
After failing to hold above the key psychological level of $40,000, bears were able to regain control of price action, allowing them to drive BTC/USD back towards the January low of $32,932, currently holding as support.
As the 50% Fibonacci level of the 2020 – 2021 turns into resistance, the MACD (moving average convergence/divergence) has fallen below the zero line, a possible indication that the downtrend is likely to continue to hold, at least for now.
Bitcoin Daily Chart
Source: TradingView, Chart by Tammy Da Costa
If selling pressure continues to mount, bearish continuation could result in a retest of the January low ($32,932) which paves the way for the 38.2% retracement of the above-mentioned move at around $28,860 with a move lower bringing the $26,000 handle back into play.
--- Written by Tammy Da Costa, Analyst for DailyFX.com
Contact and follow Tammy on Twitter: @Tams707
