The Daily Cryptomenon
25th August 2020
Your daily Cryptocurrency Market Analysis News brought to you by the CryptoAltum Cryptomenon Team.
This analysis was written at 9:00 am GMT +3, on 25.08.2020
Markets still struggle with their movement higher, especially in current conditions where sellers seem to be adamant on not allowing the Bulls to have their way in the cryptocurrency market. Every time the markets move higher, they’re met with overwhelming selling pressure at key points making life for Bulls much harder. However, demand has never been higher for these instruments as they’re slowly becoming an inflation safe asset not unlike Gold, but with an extra dose of volatility. With that said, let’s find out what today holds for the Cryptocurrencies on August 25th, 2020.
Our Cryptocurrency trio - Bitcoin, Ethereum, and Ripple have continued to move sideways, but there’s some positive pressure going on that’s helped them move just a tad higher. Bitcoin has failed to properly break above the $11,800 resistance and fell back towards the $11,690. Ethereum has managed to break above the $400 again but wasn’t able to move above $410 as it currently sits just above the $400 support zone. Ripple also seemed to rally just a bit but found sellers waiting at $0.2920 forcing the Cryptocurrency to fall back to $0.2870.
Bitcoin (check out the chart below you’ll find that Bitcoin is the purple line) continues to record a steady performance of 21.98% on a month-to-month basis*. Ethereum’s (red line) performance over the past month hasn’t been anything to write home about when compared to its performance last month. Currently, Ether is recording a performance of 42.26% on a month-to-month basis. Ripple (orange line) is mirroring the move in Ethereum, in terms of performance, as it too has had a bad performance over the past month. It still managed to record a performance of 38.55% on a month-to-month basis.
*Please note that we mention month/on/month we mean the same day, one month ago. For example, 29th of July till the 29th of August.
What’s the strategy you’re going to use when it comes to these cryptos? Do you believe that the Bears will finally control this market? Or do you believe that the Bulls will manage to move back up after a short while? Whatever you choose to believe, you can react to it all on CryptoAltum.
Bitcoin Fails To Break Higher
Even with all the hype that Bitcoin is receiving for another move higher, the Cryptocurrency king hasn’t been able to clear the first important resistance in front of it at $11,800. Bitcoin has tried to move higher following its bounce from the $11,500 support zone, and it has made some progress higher but on a much flatter curve, rising only bit by bit. It did however manage to reach the mentioned resistance level, but due to the decreased momentum, it hasn’t been able to break above it.
When we analyze the technical events of this move, we notice that the $11,800 has actually helped with the presence of both the 50 and 100 SMAs (Simple Moving Averages), these have created quite the barrier for the instrument and are making it that much more difficult to revisit the highs that the Bitcoin Bulls so desperately want. This has emboldened Bears and established a skirmish between them and the Bulls. So, for the Bulls to continue moving higher the $11,800 must be overtaken.
The RSI (Relative Strength Index) managed to break above the 50-level and reach 55, however, with the presence of the important resistances in the price action, the move lower was inevitable. The move sent the indicator below the 50 indicating that whatever momentum the Bulls had was lost quickly. Now, the Bulls are looking to build enough momentum to try the $11,800 again and $12,000 by extension.
Ethereum Falls Back to $380
Ever since Ethereum fell towards the $380 level, it has been nurturing a recovery, and the Bulls’ efforts yielded on Monday with Ether reclaiming support at $400. However, the bullish price action was cut short before ETH tested the resistance at $410. A reversal is underway at the time of writing but buyers are keen on keeping the price above $400. ETH trading right at the $400 level with bearish momentum building on this instrument. On the upside, price actions are limited by the convergence of the 50 and 100 SMAs in the 4-hour range.
According to other technical levels highlighted by indicators such as the RSI, Ethereum is likely to extend the bearish leg under $400. The RSI is pointing sharply downwards. Technically speaking, a slide below the average and towards the oversold is expected in the short term.
If push comes to shove and Ethereum slides under $400, a free-fall could refresh the support at $380. The support range between $360 and $380 is expected to continue holding Ethereum from the frequent dips under $400. The 200-day SMA at $375 is also inline to prevent declines from wiping off the progress that has been made in the past couple of months.
Ripple Faces Bearish Pressure
Ripple has been moving a tad bit higher ever since it tested the support at $0.2800, since then, the move higher was more of a sideways move with an upward bias, but it was enough to test the resistance level (or at least come close to it) at $0.2950. The move, however, was halted by the presence of the 50 and 100 SMAs. The instrument hit these two lines and the Bears stepped in driving Ripple lower as it currently trades around $0.2865.
This move has translated into a move below the 50-level on the RSI sapping whatever momentum Bulls had. The increasing bearish pressure is only going to get stronger as Bears aim at a retest of the $0.2800, however, Bulls aren’t going to let that happen. That’s a very important support, breaking below would open the flood gates with no meaningful supports until $0.2400.
For the Bulls to regain any semblance of control, the $0.2800 must be protected at all times as well as breaking above both SMAs and the $0.2950 by extension as moving towards the $0.3000 would be a great victory for the Bulls. This could be the jump in momentum that the Bulls need for another move higher. For the time being, the focus has to be on defending the $0.2800 otherwise there’ll be no happy ending for the Bulls.
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