Crypto Daily: Moving Averages Anticipate Big Bitcoin Drop
The first month of summer is coming to an end and for cryptocurrency that means one thing: silent. Little to none impact announcements, low trading volumes and historically tight volatility is giving traders a sense of what many know as “the calm before the storm”.
Bitcoin
From a technical perspective, the top cryptocurrency isn’t doing well. In the past two months, the price has failed to penetrate the $10,000 mark, which suggests weak buying pressure. At this level, buyers keep collecting gains and moving out, sending the price backwards.
The EMA20 and EMA50 have begun to unfold and we can expect an intersection in the near future. Such a cross is a bad sign for BTC, and it could anticipate a major decline. A similar thing happened in 2017.
Oscillators (MACD, RSI, Stochastic) also point lower. Bollinger Bands narrowed significantly, portending a sharp jump in the near future.
Immediate targets for buy orders are located within the $7,000 — $8,000 range. The $6,500 support level is the key to predict the future of Bitcoin. Moving below that mark could indicate further losses, while bouncing from there could unleash substantial growth for Satoshi’s currency.
Ethereum
The price of ETH follows Bitcoin’s dynamic. Over the past month, the digital asset tried to surpass the $250 mark but couldn’t do it. As a result, ETH entered in an ascending triangle and confidently entrenched under it.
Oscillators also show lack of buying pressure. And moving averages almost completely repeat the structure of the world’s top cryptocurrency.
As outlined in previous analysis, the future of ETH largely depends on BTC. That said, we can expect a drop to $180. Perhaps for some time the asset will be stopped around $200, but it won’t be the final stop.
Litecoin
Unlike Bitcoin and Ethereum, Litecoin has been in the same range for about 3 months near the $45 level. There were small attempts to break up above $50, but sellers made sure to keep things unchanged.
Extremely weak oscillators suggest a downturn is likely and the range $32–30 is clearly on sight. Based on this, you can either open a short position or sell at current levels and wait for the price to roll back to the above zone.
Altcoins
Nearly all cryptocurrencies in the Top-10 present a similar structure to LTC. Take a time to assess your current trading strategy and prepare for a possible fall of 20% to 30%. While these percentages might sound ‘too big’, it’s a possibility considering the long sideways the market has been moving lately.
