Bitcoin bends, the crypto market unscrews: beware of the return of bearish momentum?

Since last Sunday, the crypto market has taken on a very different dynamic from what we have seen in recent weeks. Indeed, after the arrival of the American indices on technical resistances and the bullish resumption of DXY, the market unscrewed downwards by returning to old price levels. The question is whether we will continue this decline or if it is just a stall before going for new price highs. In this crypto point of the weekend, let’s see together what could happen.

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Cryptocurrency Market Clears Recent Efforts

Total Cryptocurrency Market Cap Price (1D)

After breaking out of the red zone where the market was struggling, a top was found on the May 27 low at $1.147 billion. However, the crypto market failed to hold above the technical confluence which is the MA100, the EMA 13/25 as well as the former resistance. Falling sharply, the market returned to the resistance seen in June and July. Simple retest? Or, a small rebound before going to see lower?

It is clear that if the market wishes to resume its bullish momentum, it is preferable to witness a resumption of the confluence of technical levels that we have just mentioned. This would show strong buyers. HAS on the contraryif it is rejected on these levels, this will lead us to a simple observation: the momentum is bearish, it will be necessary to favor short positions.

Altcoins are hit hard

Market capitalization price of cryptocurrencies excluding Bitcoin and Ethereum
Price of cryptocurrency market capitalization excluding Bitcoin and Ethereum (1D)

As we know, altcoins are very sensitive to the movements of Bitcoin and Ethereum, the latter more interestingly given its recent outperformance. Last week, I warned about the importance of the POC in confluence with the red zone. Having managed to get rid of it, the market could continue to rise. However, being dangerously close to it, it lost this level which was in confluence with the MA100. Having failed to recover the EMA13 and 25 which are good tools for the short term trend, this confirmed the bearish bias to have on the market.

Altcoins are back to around 395 billion, an interesting technical area that needs to be picked up. This would make it possible to attempt a bullish push towards the 25 EMA (grey line) then the 200 EMA if possible. However, a rejection of the price to the current levels will likely mean continued bearish momentum for altcoins. In this context, it will probably be necessary to expect a return of the price on the Value Area Low.

Bitcoin tries to regain strength but nothing is decided yet

Bitcoin Dominance Course (1D)
Bitcoin dominance price on a daily scale (1D)

Currently, bitcoin’s dominance is unbelievable. On the contrary, it demonstrates the asset’s lack of vigor for several weeks. Currently pausing in its fall, it sideways between local support and resistance in confluence with the 13 EMA. By retaking this red zone, the fight for a bullish leg will not be over since it will have the 25 EMA to resume which is in confluence with the horizontal level that we have identified for several weeks.

If it manages to resume this set of technical levels on the upside, we can probably envisage a return to the blue pivot zone with a return to the 200 EMA (black dotted line). However, if bitcoin continues to be weak registering new lows and highs lower than the previous one, it will strengthen my hypothesis of a return of bitcoin dominance to the green zone. At 40%, this area is not negligible and will probably act as support.

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