Since April, Bitcoin (BTC) and Ether (ETH) have begun a correction that shows no signs of stopping. Prices are now at major support levels, which will have to be held to avoid invalidating the rise seen at the start of the year. So what are the different scenarios to watch out for? We take a look in this analysis of Bitcoin and Ether
Bitcoin (BTC) finally back to $25,000
After multiple tests of breaking above $30,000, an area that represents significant psychological resistance, the price of bitcoin (BTC) will finally fail to soar. While the start of the year had got off to a very good start with a strong uptrend, it is now time for a correction and uncertainty in the face of the SEC’s various attacks on the cryptocurrency market.
As we explained in our previous analyses, this return to $25,000 seemed highly likely, given the lack of volume and the importance of the next support level, $25,000. Now we need to bounce back quickly, otherwise BTC could fall back below $20,000 and the Bear Market could drag on even longer.
Figure 1 – Bitcoin Daily price chart
So Bitcoin finally retreated to the lower part of the broadening pattern in yellow, following the break of the small dotted triangle whose target was clearly a return to $25,000. Now that this price has been reached, Bitcoin finds itself under a number of resistances: the $30,000 level, the Ichimoku cloud, the Tenkan (turquoise curve) and the Kijun (purple curve).
There are so many obstacles in the way that it is difficult to see any short-term upside potential. The support cloud around $30,000 will have to be regained if we are to talk of a bullish scenario.
In the meantime, as the price finds itself moving within a large ascending broadening pattern (in yellow), we believe there is a real risk of continuing the current downtrend. This is a pattern whose exit probability is very much in favour of a fall.
Although the $25,000 area remains an important support to hold, the real areas to watch are those characterised by the Weekly Kijun at $23,667 and the Monthly Tenkan at $23,265. These levels should be held as a matter of urgency, as they allow buyers to maintain a bullish bias.
If the price breaks back below these supports, they will become resistance levels and will help BTC to hit the breakout target of the ascending broadening pattern around $20,600. As the Chikou Span is still a long way from the lower trendline of this chartist pattern, there is a good chance that the downside breakout will not be confirmed for several days. This would give prices time to stabilise above $25,000 before a new bearish impulse.
Ether (ETH) on the way to a retest of the $1,500 mark?
As for the price of the Ethereum cryptocurrency, Ether (ETH) is continuing its correction after breaking out of an ascending broadening several weeks ago. After a final pullback to $2,000 failed to break through this important resistance, the price now looks set to head straight for that crucial $1,500 support.
Figure 2 – Ether price chart (Daily)
Ether has broken its support at $1,750, which was once resistance and which should now allow the price to rebound since this is an area that had been worked on for a long time. Unfortunately, with ETH having fallen back below this zone, there is now a risk that it will once again become an obstacle.
As long as it does not break back above $2,000, the analysis will remain bearish, with a target of $1,569. All of the Ichimoku’s curves are likely to stand in the way of the price for a long time to come.
Conclusion of this technical analysis
In the coming days, cryptocurrencies will absolutely have to initiate a rebound on the supports being retested. Otherwise, new bearish targets will be activated with the risk of having a summer in the red.
