The state of crypto at the moment, in trading terms, is mostly bearish. The Bitcoin (BTC) downtrend in play since July is still in play, although there has been (yesterday) a promising bump in Bitcoin's price off of a key support.
While Bitcoin has continued to head down, there has been some action in the altcoin market in past weeks – the drama with MATIC, and the steady comeback of Tezos are notable here. But with the market still locked in a general decline, even as Bitcoin’s market dominance and price are bouncing, we should not expect altcoins to pick up the slack at this time. It is likely that Bitcoin support must be found before anything positive and long term happens in the market.
We begin with OKEx’s exchange token, OKB (OKB), which has been on the hot new FTX exchange long enough now to form an acceptably populated chart. OKB has faced a sharp decline during November, concurrent with Bitcoin’s continuous descent, and still seems to be plagued by this downtrending attitude.
Starting on the daily USD pairing, we first note that continuous hanging at the EMA cluster, between $2.50 and $2.70, which translated into a loss of that level. But with the Bitcoin bounce, OKB's price also got a kick – and this was enough to push the exchange token back above the present support around $2.30. This is a positive development.
In the long term, the trend here seems to have waned into a sideways consolidation, which is also evident from the falling trade volume. If Bitcoin continues trending down, we are pretty likely to see a $2 OKB at the next support; and if it holds there, we will be watching for a general consolidation around $2.30.
Now that OKB has regained the support area below $2.45, its next task is to hold and eventually chew through the EMA knot here. We've already seen a rejection at resistance just above, and we also know that most of this gain was probably caused by Bitcoin's bounce and not from organic buying. But the reversal candle that came on the 17th was a good start to putting in a new short term uptrend.
At minimum, OKB needs to hold the 8 and 21 EMAs for now.
Moving to the main event, we look at the weekly Bitcoin (BTC) chart. In the long term, the downtrend is still strong, as Bitcoin has entered well into price territory from the big 2018 consolidation around $6k. BTC was continuously rejected at the important 55 EMA, while the histogram on this chart has formed an awkward flat formation, refusing to contract back to the upside.
Lower highs and lows on the RSI reflect the unrelenting downward pressure; but we do see that volume is declining as price falls, which may reflect an ebbing sell pressure. We can well imagine that Bitcoin will need to find support at the last strong support in this local area, just under $6k, if it comes to that.
But on the daily, we must acknowledge the bounce that has come yesterday off of 2018's final consolidation range above $6k. This is a promising first start to what may turn into an uptrend to some degree. Although these are the first inklings of a potential end to the larger downtrend, we should not be excited just yet – Bitcoin has its work cut out for it in this regard.
Ethereum’s (ETH) price did not benefit from the recent Devcon5, as it continues to slide – almost shockingly so – even against Bitcoin, including after yesterday's Bitcoin bounce. This of course translates into augmented losses versus USD.
Starting on the weekly ETH/BTC chart, we note first of all that Ethereum is not even trying, anymore, to even contact the “capitulation level” lost earlier this year. That level marks the previous lowest level since 2017, which was taken out earlier this year.
Ethereum is currently retesting a local support zone, laid during the summer. Volume has been on the decline during the downtrend, and there is thus a decent chance for a double bottom here with a higher low. However, the histogram is at present expanding spookily to the downside. ETH has not even been able to hold out above the 8 EMA, which is also pretty alarming. This would be a good place for bulls to support this leading altcoin – because if 0.018BTC is lost, we are going to see some real fireworks.
During the 2018 bear market, Ethereum famously dropped below $100 for the first time in a long time, and on the daily USD chart we see that we are again very close to this happening again. ETH/USD is threatening to take out one of the very last supports keeping the altcoin above double digits. Even with the Bitcoin bounce, almost no traction has been made in getting back above support.
The RSI here has lost the chance to put in a bull divergence even if it does put in a low here, which won’t be good for buyer confidence should it stabilize. Some volume has come in to try and defend Ethereum here, but more is probably needed. The histogram, having started contracting sharply, is getting chopped up and heading down again. But the candle formation doesn't look bad, almost a bullish engulfing yesterday. But Ethereum is very weak, and what strength it has seems to be flooding into BTC.
More and more, the hi cap cryptos like Bitcoin and Ethereum are looking like they want to do enormous 1.5-year double bottoms. If Bitcoin holds $6k and Ethereum holds $100, we could yet see a bright 2020.
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