The Daily Cryptomenon
7th December 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 07.12.2020
Consolidation remains the name of the game in the Cryptocurrency market as there wasn’t much movement over the weekend which made markets simply continue to trade within their respective ranges. The market is still quite indecisive on which direction it wants to go next which explains why the cryptos are still trading within the same ranges.
With that said, let’s find how the Cryptocurrencies are doing on December 7th, 2020.
The weekend saw our Cryptocurrency trio - Bitcoin, Ethereum, and Ripple - stay within their respective ranges without much movement. They simply continued to trade in a sideways fashion without moving either higher or lower. Some attempts were made by Bitcoin to move higher, but those were quickly shutdown without a second thought.
Bitcoin attempted to move above the $19,500 in the past couple of hours but the momentum is nowhere near enough to break above such an important resistance. What’s more is that the RSI (Relative Strength Index) is unable to break above the 60 level indicating that the bullish momentum hasn’t been able to gather enough push to move higher. However, with a squeeze happening in the Bollinger Bands, a breakout isn’t far behind.
While Bitcoin at least attempted to move in a certain direction, Ethereum simply remained stuck in a very narrow range between the $610 on the top and $580 on the bottom, effectively limiting any kind of major breakout without a test of either level. The RSI is also painting the same picture as the indicator simply prints above the 50 level but only barely signalling that more consolidation is on the horizon.
Ripple is going nowhere anytime soon because for now it’s confined between the $0.6800 on top and the $0.5700 on the bottom, effectively communicating to leave it alone as it tries to understand which direction is best at the current moment. The Bollinger Bands are showing signs of a squeeze, meaning that there’s going to be a breakout soon, however, it’s unclear which direction said breakout will be in.
Bitcoin’s (check out the chart below; you’ll find that Bitcoin is the purple line) performance is printing at 23.72% on a month-to-month basis*. Ethereum’s (red line) performance is printing at 29.93% on a month-to-month basis. Ripple’s (turquoise line) performance is printing at 132.35% on a month-to-month basis.
*Please note that we mention month/on/month we mean the same day, one month ago. For example, 1st November till the 1st December.
What’s the strategy you’re going to use when it comes to these cryptos? Will the consolidation remain the dominant factor in the market? Or will there be a breakout in the Cryptocurrency market soon?
Whatever you choose to believe, you can react to it all onCryptoAltum.
Bitcoin Struggles Against $19,500
Even though there were a couple of spikes below $19,000, Bitcoin was able to recover from those levels and rise back higher. The price action was even able to break the $19,000 resistance level and remain settled above the 100-SMA (Simple Moving Average) on the 2-hour chart. More importantly, there was a break above a major bearish trend line with resistance at $19,150. The pair surpassed the $19,400 level, but there was a lack of bullish momentum.
Bitcoin struggled to even test the $19,500 resistance level after the trend line break. A high is formed near $19,432 and the price is currently declining. The price is now approaching the $19,150 support and the 100 hourly simple moving average. The broken trend line at $19,150 and the 100-SMA are providing support.
If Bitcoin fails to stay above the $19,150 support and the 100-SMA, the Cryptocurrency could decline sharply. An initial support is near the $19,000 level. A proper close below the $19,000 support might increase pressure on the Bulls and the Bears are likely to gain traction. The next major support sits near the $18,500 level.
Current Market Sentiment:Neutral with Bearish Bias
Ethereum Continues Consolidation
In the past few sessions, Ethereum made a couple of attempts to gain bullish momentum above $600 and $605. However, the selling pressure has made it very difficult for the Cryptocurrency to settle above $600 as it continued to trade in a broad range. The last swing high was formed near $607 before the price corrected lower. There was a break below the $600 and $595 levels.
The price is now consolidating below the $600 resistance and above the 100-SMA on the 2-hour chart. There’s also a major bearish trend line forming with resistance near $602. To start a strong increase, Ether must clear the $600 and $602 resistance levels. The next major resistance is near the $620 level, above which the Bulls are likely to aim a new yearly high above the $636 level.
If Ethereum fails to clear the $600 and $602 resistance levels, there’s a risk of a bearish reaction. The first key support is near the $592 level and the 100-SMA. A downside break below the said moving average could lead the price towards the $585 support. Any more losses might start a steady decline towards the main $565 support zone in the near term.
Current Market Sentiment:Neutral
Ripple Continues to Prepare for $1.0000
Ripple is still trading above $0.6 after a motionless weekend session. The cross-border Cryptocurrency appears to have settled for consolidation just like Bitcoin. Meanwhile, a breakout is expected to come into the picture as consolidation is likely to hit a tipping point in the near term.
At the time of writing, XRP is trading around $0.6170 while trying to establish a firm foothold above the 100-SMA on the 2-hour chart. Ripple will have to settle above the moving average level to first sustain the uptrend before confirming a breakout towards the next hurdle at $0.65. The rest of the journey to $1 will depend on the Bulls’ ability to overcome the supply at $0.7 to $0.75.
On the downside, it’s essential that XRP holds above the middle boundary of the Bollinger Bands, to avert losses that might refresh support at $0.57. It’s worth noting that a breakdown can occur following the Bollinger Bands’ constriction, risking the progress made since the fall to $0.45. The 200 SMA is in line to absorb some of the selling pressure, and perhaps prevent Ripple from plunging sharply.
Current Market Sentiment: Neutral
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