The fear of COVID-19’s proliferation and impact continue to keep more investors out of the market
Last week and this Monday were difficult for the global financial markets. The crashes were caused by the Coronavirus pandemic. Following traditional financial instruments, the crypto market also collapsed and Bitcoin lost 34% in the last 7 days. Ethereum dropped with 43%, Ripple’s XRP crashed with 30% and Bitcoin Cash lost 33%.
This morning, major cryptocurrencies have found some support. But the Ethereum bulls expect the risk appetite to continue to be affected by news around the Coronavirus. Despite the current apparent stability, investors seem to be shying away from the market, preferring to watch only from the sidelines. The downturn last week showed that Bitcoin’s safe-haven status was shattered.
Recovering over $ 6,000 will be required for the BTC bulls to pave the way for more price action towards $ 7,000. But BTC/USD is not ready technically. In order to pave the way for significant price movements north, the pair must overcome the sales pressure at H4 50 SMA ($ 6000). The next critical resistance is at the $ 7000 psychological level. And after that comes the 100 SMA, which is localized at $ 7,339 on a four-hour chart.
Earlier in the week, the total crypto market cap hit a high of $ 164.76 billion before slipping to $ 131.81 bln. Tuesday’s bullish momentum led to a recovery of $ 150.13 billion on Wednesday morning.
Bitcoin dominance returned to levels of 64% on Monday’s sell-off. At the time of writing is around 63.8%. 24-hour trading volumes in the crypto market amount to $ 121.05 billion.
Ethreum in consolidation after last week’s collapse
Like other crypto assets, Ethereum is experiencing a huge panic sell-off and the price has plummeted from $ 206 to $ 86. However, after rising above the $ 100 level, Ethereum began its appreciation against the USD yesterday. But mainly the price is consolidating into a triangle on a daily chart and is now trying to break the downside trend line of the figure. On the hourly chart, Ethereum is currently testing the lower curve of the 20-day Bollinger Bands.
Immediate resistance is seen at $ 115.50, which is 23.6% Fibo corrections on the recent drop from $ 206 to the bottom $ 86.46.
If the bulls manage to break through the important $ 120 resistance zone (also H1 100-day SMA), Ethereum may be ready for a strong upward move in the near future. The next key obstacle for the bulls is near the $ 132 and $ 146 level.
However, if Ethereum fails to break both the triangle and the resistance at $ 120 up, this could trigger another decline. The closest support levels are close to $ 112 and $ 110.
RSI indicator for Ethereum bulls
The RSI indicator sits on the edge of the oversold area. The SMA 200 is about to cross above SMA 20 on a daily chart. If it does, we will have confirmation of the heavily bearish “death cross” model. What does all this tell us? The answer is that while bulls may responsible for short-term movement, overall market sentiment remains bearish. In addition, MACD also slumping down.
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Author: Silviya Velcheva
* The views expressed in this material do not constitute a recommendation or advice for the purchase or sale of cryptocurrencies in the digital assets market or other financial instruments. The predicted forecasts meet the expectations of the author of the material and may not materialize. Trading in currencies, contracts for differences on margin, or cryptocurrencies poses a high risk and may not be suitable for all investors. Past results are not a guarantee of future success.