Cryptocurrency Price Analysis: Bitcoin & Litecoin Probing Big Support
- Bitcoin in danger of breaking confluence of support, important slope under pressure
- Litecoin also in danger of support-break, eliminating wedge possibility
- Ethereum trend-line at risk or breaking, if it does then 863 targeted
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Bitcoin in danger of breaking confluence of support, important slope under pressure
This morning we are seeing a sizable drop in cryptocurrency-land, with double-digit percentage declines taking place across the board. Bitcoin is in real danger of breaking critical support by way of a slope extending higher from May and horizontal levels.
The slope dating back to May is viewed as rather significant given its influence on several occasions since, most recently in November. While it has always been a form of resistance, once it was broken it became a source of support.
The May slope along with price levels during December make the ~11700/150 price zone an important one. Hold and Bitcoin lives to fight another day, possibly building the descending wedge we discussed last week. Break, and the trend-line from July in the low 10000s and worse (maybe much worse) come into play.
Chart 1 – BTC/USD: Daily
Litecoin also in danger of support-break, eliminating wedge possibility
Litecoin is probing support, with a slight breach below the 200-level taking place this morning. It would mark a lower-low if it does hold below, and the spike-low at 173.68 would be up next as support.
A break below both levels could lead to a much larger decline. A hold of support through today will still keep life in Litecoin, but it will need to quickly turn higher if it is to maintain a neutral to bullish technical backdrop (keep a descending wedge still in play).
Chart 2 – LTC/USD: Daily
Ethereum trend-line at risk or breaking, if it does then 863 targeted
Ethereum is in danger of breaking the trend-line from December if today’s sell-off remains as is, or deepens. There is minor support at 965.18, but the level of bigger interest is the December 19 high at 863. Below there we will then have to turn to the trend-line from November in the mid-700s.
Chart 3 – ETH/USD: Daily
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---Written by Paul Robinson, Market Analyst
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DailyFX provides forex news and technical analysis on the trends that influence the global currency markets.