The Daily Cryptomenon
22nd September 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 22.09.2020
It was only a matter of time before the Bears noticed exactly what was happening in the market and forced their will and way in. The Cryptocurrency market suffered another bout of bearish pressure, enough to send it back down and the prospect of another bullish rally is somewhat shattered. However, with the presence of important supports at the lower bound, it’s tough to say that the bearish pressure will continue. With that said, let’s find out what today holds for the Cryptocurrencies on September 22nd, 2020.
Our Cryptocurrency trio - Bitcoin, Ethereum, and Ripple have all suffered from the increased bearish pressure as we mentioned earlier. The Trio was on the verge of breaking above some important resistances, but the selling pressure at these levels won at the end and forced these Cryptocurrencies back quite a bit. Bitcoin has been attempting to break above $11,000 after failing to establish a credible foothold above it. However, sellers and Bears entered the market with such force that drove BTC towards the $10,200 before managing to bounce higher towards $10,400. Ethereum’s drop managed to break below 2 supports at $360 and $350 before managing to hold at $330 and bounce back towards $340. The damage has touched the Bulls already. Failing to break above $0.2550, and with the continued bearish pressure, Ripple was forced to relinquish control of the $0.2400 level to the Bears as the Cryptocurrency fell all the way to $0.2300. That level had already been acting as a current floor to Ripple.
Bitcoin (check out the chart below you’ll find that Bitcoin is the purple line) failed to capitalize on its move higher allowing the Bears to take control and force it to drop quite significantly affecting its performance which records a -8.85% on a month-to-month basis*. Ethereum (red line) suffered a similar fate to that of Bitcoin; it failed to move higher so it fell lower increasing its negative performance to -10.74% on a month-to-month basis. Ripple (orange line) follows in the footsteps of its older cousins and is forced down by the bearish pressure to reach a performance of -16.57% 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 August till the 1st September.
What’s the strategy you’re going to use when it comes to these cryptos? Will the supports finally crumple leading the cryptos to fall even further? Or are these supports going to be the building blocks that the Bulls rely on to bounce higher? Whatever you choose to believe, you can react to it all on CryptoAltum.
Bitcoin Fears of Reaching $9,600
As things progress, fears of Bitcoin moving towards the crucial CME futures gap at $9,600, formed when the Cryptocurrency surged from the $9,000s in late July and early August, are increasing. Why is this happening? Well, the CME futures market is closed on the weekends, despite Bitcoin spot markets still trading. This forms natural gaps in the CME’s price action, many of which are filled within a week after they were opened.
One of our CryptoAltum Analysts has noticed this and is convinced that since Bitcoin failed to hold the bearish pressure at $10,900, the Cryptocurrency will continue towards the $10,200 which it already did before it managed to bounce back from that level. The damage has been done, though, and the road towards $9,600 has all been paved. A majority of our Analysts are starting to think this way specifically that a move towards that support level is inevitable.
However, not all are convinced. Some believe that due to the increased bullish and buyer presence at the lower levels, the gap might not all be closed and there’ll be a bounce in the near future. That’s concerning the medium term. When it comes to the short term, the RSI (Relative Strength Index) is showing oversoldness. If there’s a move above the 100 SMA on the 4-hour chart, the short term seems to be looking positive.
Ethereum Abandons Higher Levels
The second-largest Cryptocurrency has been on a downward roll after it failed to break above the important resistance at $390 and fell from that level. Not even the supports at $380 and $360 failed to come to the rescue of the Bulls as the Bears extended the push lower to end up below $340. Ether tested the short term support at $330 before recovering slightly.
Looking at the 4-hour chart, we find that the technicals are telling us something; Ethereum isn’t done with the downside. There’s a possibility the lower leg will retest support at $310 and $300 before formidable recovery can be staged. Bulls better be careful and prepared for a battle at the lower levels.
The bearish scenario is validated by the Relative Strength Index (RSI). The indicator is currently stuck in the oversold. Basically, the longer the RSI stays under or around 30, the stronger the bearish grip becomes. Note that the 50 Simple Moving Average aborted the mission to cross above the 100 SMA in the 4-hour range, hence signalling more sell orders. If the gap made by the 50 SMA under the 100 SMA continues to widen, I can expect Ether to hit lower levels at $310 and $300 in the near term.
Ripple Fell with Bearish Pressure
The bearish pressure reached the third-largest Cryptocurrency, Ripple, and forced it lower, breaking below the 100 SMA on the 4-hour chart. For now, it looks like the price has been able to withstand any move below the $0.2300. But how long will it take for the support to continue proving its usefulness isn’t quite clear as the RSI is showing increased bearishness when it comes to Ripple.
One of our CryptoAltum Market Analysts is saying that Ripple still has downside pressure that can be enough to force it below the currency support at $0.2300 and reach the $0.2100. From there, the analyst is sure that XRP will be able to fire back higher. This relatively depends on whether or not the other Cryptocurrencies are able to move higher as well.
The RSI is already showing some move higher after it fell quite low, below the 30-level which indicates extreme oversold pressure. As long as RSI stays within that range, Ripple will continue to fall lower. The 100 SMA on the 4-hour chart is the current level that Ripple is targeting in order for the bullish pressure to be reignited. Now that’s an uphill battle.
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