Over the past week, the US equity, gold, crude oil, and the crypto market have been revised, showing that traders in most asset classes have made gains. The total market value of cryptocurrencies has been revised from a high of $394 billion to a low of around $313 billion, a correction of around 20%.
Due to the extent of the adjustment, traders should carefully monitor price movements before entering any long position.
Crypto Market: BTC/USD
Bitcoin (BTC) has failed to rebound much from the $10,000 level in the past three days, showing that the bears are selling on every relief rally. This suggests that market sentiment has shifted from buying on dips to selling on rallies.
Unless the bulls push and hold the price above $10,400, the bears will attempt to resume the correction. If the BTC/USD currency pair stays below $10,000, it can drop to the 200-day moving average ($9,078).
This is an important support to look out for because if the price breaks and stays below this level, sales may intensify further. The next level of support down is $8,000 and then $7,000.
However, if the currency pair recovers to current levels and rises above $10,625, it can rise to $11,000. This is an important level to watch because if the bulls can push the price above this level it means the downtrend has ended.
The 4-hour chart shows that the bulls will not allow the price to stay below $10,000, indicating that they are building up at lower levels. If the bears fail to convincingly break the $10,000 support level in the next few days, the likelihood of a strong rally increases as aggressive bulls buy in anticipation of a bottom.
Breaking or falling below the $9,835-10,625 area is likely to trigger the next trend. Until then, trading in this area can remain volatile.
Crypto Market: ETH/USD
Ethereum (ETH) fell and closed below the strong support level of $366 on September 5th, which is a negative sign. The altcoin is currently trying to rebound to $308.392, just above the 100-day moving average of $304.
The bears will try to prevent relief from recovering to $377.053. This is the 38.2% Fibonacci retracement of the most recent decline since the 52-week high.
If the ETH/USD currency pair falls from this level and drops below $308.392, it can drop to $288. Any interruption to this level of support has enormous negative effects.
Conversely, if the bulls can keep the price above $366, or if they can prevent the next drop below $308.392, the likelihood of bottoming increases. This could attract more buyers which could resume the uptrend.
Chainlink (LINK) fell to an intraday low of $9.10 on September 5, slightly above the key support level of $8.90 and the 100-day moving average of $8.69. The strong rebound in support shows that the bulls are already actively buying at lower levels.
Currently, the bulls are trying to push the price above the 50-day moving average ($12.29). Above that level, the shorts can again challenge the shorts at $12.89. If LINK/USD falls from any level, the bears will attempt to bring the price below the USD 8.90 support.
Conversely, if the bulls can push the price above $12.89, it can fall to the downtrend line. Breaking this level would mean the bulls are back in power and could rebound to $17.7777.
Crypto Market: NEO/USD
The bears’ failure to keep the NEO below the breakout level of $16.72441 is a positive sign. This shows that the bulls are not going to sell their positions out of fear. The 50-day moving average ($14.98) and the 100-day moving average ($12.89) are rising, indicating that the medium-term trend remains bullish.
However, the bears are unlikely to give up the fight because they are in the sti. The resistance levels are $18.75334 and $19.53099, respectively. These are the 38.2% Fibonacci retracement levels and 50% of the last correction since the 52-week high.
If the bulls aggressively buy the next level again, which falls to $16.72441, it suggests that the near-term low may be present.
Contrary to this assumption, the correction may extend to the 50-day moving average and then to the 100-day moving average if the bears fall and keep NEO/USD below $16.72441.
NEM (XEM) attempted to rebound to $0.1023475, just slightly below the 50% Fibonacci retracement level of the entire upside that began in late June. This shows that the bulls buy on dips, which indicates positive sentiment.
The rebound could face resistance at $0.1413531, the intraday high on September 5th. However, if the bulls can extend the price past this level, they can retest the recent 52-week high of $0.1690655.
Contrary to this assumption, the pullback to the Fibonacci retracement level of 61.8% from $0.0890120 may extend if the XEM/USD currency pair falls below $0.10. Any interruption to this level of support has enormous negative effects.
The 4-hour chart shows the bulls should not be allowed to keep the price below $0.105, but the rebound is bouncing off the recent decline at 38.2% Fibonacci resistance.
If the currency pair breaks from this resistance level, the bears will try again to bring the price lower and below $0.105. If they are successful, the drop can be extended to $0.0890120.
Conversely, if the bulls actively buy the next decline again, it indicates less strong demand. If they can push the price above the downtrend line, it increases the likelihood of a bottom.
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