The Daily Cryptomenon
29th October 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 29.10.2020
The more the Cryptocurrency market trades this way, the wider the divergence between BTC and all other altcoins is going to widen. While all Cryptocurrencies suffered a pullback from their respective highs, which was kind of expected after the move higher, Bitcoin seemed to be the least one fazed by the move as other altcoins witnessed a continued downtrend.
With that said, let’s find out what today holds for the Cryptocurrencies on October 29th, 2020.
Cryptocurrency Recap
Our Cryptocurrency trio - Bitcoin, Ethereum, and Ripple - continued to trade at their normal pace with some experiencing more downward pressure than others. When looking at the overall trend of the movement, Bitcoin is the clear out performer as it continues to move higher, however, ETH and XRP are both showing signs of downward movements.
Bitcoin broke below important support after the $13,860 rejected the upward momentum. The movement led towards the $12,800 support but was to climb back higher towards the $13,250 level and consolidated around there.
Ethereum couldn’t handle the downward pressure it experienced from the high levels above $400 and fell back down towards the $380 level where it currently trades marginally above. The movement could attest that there has been a reset of the momentum as more information is needed to decide which way the Cryptocurrency will go.
Ripple formed a double top around the $0.2540 as twice it attempted to break above and twice failed with the second failing resulting in a massive inflow of Bears that simply took charge of the Cryptocurrency and forced back towards the $0.2450 support level.
Bitcoin’s (check out the chart below; you’ll find that Bitcoin is the purple line) performance is printing at 24.05% on a month-to-month basis*. Ethereum’s (red line) performance is printing at 10.86% on a month-to-month basis. Ripple’s (turquoise line) performance is printing at 1.95% 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 September till the 1st October.
What’s the strategy you’re going to use when it comes to these cryptos? How deep will the correction go? Will the correction change into a reversal or will there be a comeback from Bulls?
Whatever you choose to believe, you can react to it all on CryptoAltum.
Bitcoin Faces Downward Correction
Bitcoin continued to move higher and established a monthly high at $13,850, however that was short lived as the sellers stepped in and started a major downside correction. On the way down, BTC broke through the key $13,500 support level to move into a short-term bearish zone. The decline gained pace below the $13,200 level. The carnage didn’t stop there as the price spiked below the $13,000 level and traded as low as $12,890.
However, the price managed to find some support at the 100 SMA on the 2 hour chart which has helped it climb back higher towards the $13,270. Bitcoin is currently consolidating near $13,250 and above the 100 SMA, which has taken up the position as support for the Cryptocurrency.
If Bitcoin manages to stay above the $13,200 support level, it might have a chance at clearing the next level of resistance at $13,500, after which the Cryptocurrency would have a clear shot at the monthly high at $13,860. However, the main hurdle for the bulls is near the $13,500 level, so best keep an eye out for that level.
Ethereum’s Crash Resets Momentum
Ethereum has been able to trade above $400 a couple of times this week. The first time, ETH tested the resistance at $420 but retreated to $380. Earlier this week, Ether resumed the uptrend above $400 alongside Bitcoin’s surge to new yearly highs. However, Ether stalled under $415, giving the Bears a chance to swing into action.
And boy did the Bears swing! The downward move took Ethereum from above the $400 level around the $408 and reached the support level at $380, almost cancelling the entire upward move that Ethereum had worked on. This action took ETH below the 100 SMA on the 2-hour chart and forced the Bulls to recalibrate their battle plan as they currently trade around the $390 level with eyes on the $400.
The current cluster of resistance is found between the $390 and $400 levels, should Ethereum fail to break above that cluster, the likelihood of a retest of the $380 increases. Continued losses will seek refuge at the $375 level, however that’s a minor support with the main level seen at $360, but should Ether reach that level, then the bullish momentum might have been extinguished.
Ripple Shows Double Top Formation
Ripple reached the support level at $0.2450 on October 26th and managed to rally higher from that position towards the $0.2540 resistance level as it attempted to break above that level twice and both times failed. The second failure resulted in a massive move lower towards the $0.2450 support again indicating that a double top formation is in motion and the possibility of a move lower is there.
More often than not, a double top pattern is a bearish pattern and the trend is always expected to cause the asset to devalue after the formation of this pattern. The first top was marked on the 27th of October, while the second top was approached on the 28th of October. The price has been moving down and it has reached the $0.245 support level. The trade is active, though the target price for this trade was marked at the $0.240 level. If Ripple slips down this support level, the price will move towards $0.24 and confirm support there.
Currently, XRP is trading just above the mentioned support level as the RSI (Relative Strength Index) is showing signs of increased bearish pressure as the indicator prints below the 40 level. However, the price action and the Indicator are showing that the 30 level and the support level at $0.2450 are actually the same and this gives some hope to Bulls that they might be able to rally from there. Should that fail, the next target for Bears seems to be at the Critical Level of $0.2400.
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