Still in a gloomy market context, Bitcoin and Ethereum continue to suffer, but not to the point of drinking the chalice to the dregs. Indeed, if it can console many cryptocurrency investors, they have not broken their lows of the year. But the real question would be whether we would delay the timing of a next wave of correction.
In this sense, the latest technical analyzes of BTC and ETH would not plead to find grounds for hope. At the same time, the new all-time high of the Dollar Index (DXY) since 2002, hardly does their business. Worse still, we are not seeing the onset of weakness in the supreme currency. So much so that the bearish divergences on the RSI and the MACD in weekly units have been demolished, despite surges in buying.
Now let’s see how the first two digital currencies might fare this week.
Bitcoin – Suspense around $20,000
As usual since mid-August, Bitcoin is once again retesting the $20,000 support. Although prices are slightly below this critical threshold (considered the bullrun ATH of 2017), we have a feeling it could break at any time. And in the opposite case, it would be difficult to go higher given the current uncertainties on the financial markets.
Year after year, the bear market in BTC since its last ATH in November 2021 could take root. Especially since Weinstein’s phase 4 and the descending line, would not militate for a return to favor whether we like it or not. Moreover, if prices were to overcome the second, it would be necessary to break the resistance of $26,000 upwards to start talking only about the bearrun’s slack.
In the event that the end of September ends badly, Bitcoin prices would sink below $20,000 towards the $12,000 support. In the meantime, they could potentially rely on the support at $16,000, a visible but precarious intermediate level in daily units.
Ethereum – $1400 support soon doomed?
Following the bearish candle of the week of its transfer to proof of stake (PoS), Ethereum would be about to drop the $1400 support. As we speak, the two weekly candles are trading futilely below this level. Because of this, we cannot yet conclude that ETH prices will head towards its lows of the year.
But it won’t be long if a bearish crossover of the MACD against the signal in weekly units, came to ratify the last hopes of an extension of the technical rebound since mid-June. In which case, Weinstein’s Phase 4 would only escalate in intensity until proven otherwise. With a 30-week moving average (MM30 weekly) that has been trending downward since breaking the $2300 support, the bottom of its last tidy or horizontal channel.
In any case, the downward catch-up of Ethereum vis-à-vis Bitcoin has continued in a bear market logic since November 2021. A move back towards the $1000 support should come as no surprise to the most savvy investors. With, if possible, an intermediate passage which could materialize around the $1200 support, a level visible in daily units.
BTC and ETH – The Dollar Index still in good shape!
As long as the Dollar Index is still celebrating, an immediate jump in all risky asset classes is unlikely to occur. Not only are the Fed’s latest rate hike projections in 2023 above the potential for US economic growth in the short and long term. But even more serious, the market environment would become conducive to a gloomy scenario of credit crunch affiliated with a crisis of confidence.
Surely it could not happen. But on the other hand, investors need to take this into account when managing their assets. Insofar as there is not the shadow of a leading positive catalyst, bear markets for Bitcoin and Ethereum since their ATHs in November 2021, could take another wrong turn.
If the sellers were to call off their lows for the year, expect to see their losses deepen to levels consistent with a cryptocurrency bearrun. In which case, Bitcoin at $12,000 and Ethereum at $700 in a few weeks/months, would mean the materialization of a third wave of correction under the sign of a beginning of capitulation. But plausibly, a Don’t fight the FED that would go on until something broke.
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