Crypto Price Analysis 7/4: Bitcoin is now a “bounce or die” level plus ETH, XRP, ADA, XTZ, LINK
The past 24 hours have seen Bitcoin break short-term positive correlations with the S&P 500.
Bitcoin fell to $ 9,070, down 2.44% from the weekly high set in Thursday’s session. Its latest decline is due in part to high profit-taking psychology near local highs. Meanwhile, the downside also takes signals from the stronger US dollar.
According to data from TradingView.com, the US dollar index is in a two-day winning series. It was up 0.56% from the weekly low. Meanwhile, the increase of the index almost coincides with the decline of Bitcoin price.
Bitcoin and the synthetic cryptocurrency market have struggled to gain any obvious momentum recently. This is mainly because BTC has been trading sideways for months since May.
As for the next trend, it seems that all signs are beneficial for the seller.
In addition to failing to pass a critical level that it was rejected yesterday, King Coin has now dipped below $ 9,000 several times without any positive response from buyers.
A similar technical model is seen in June 2019 also causes confusion for what might happen next.
Earlier this week, buyers tried to catalyze some of the momentum leading up to $ 9,300 before it faced harsh rejection. Currently, the Bitcoin price is fluctuating in the low $ 9000 area.
A decline at $ 9,300 coincides with a decline at the 200-day EMA. Analyst ‘Teddy’ noted that now is the “bounce or die” moment for BTC.
“4h was rejected from the resistance of the cloud (200 ema). Now resting on 21ema – bounce or die”.
Source: Teddy / Twitter
It has remained above the 21-day EMA for a while since then but hasn’t posted any bullish reaction to this support.
In the summer of 2019, when Bitcoin announced its dramatic rise to a high of nearly $ 14,000, it has formed a distribution pattern that eventually led to its price entering a year-long downtrend.
This decline eventually brought it to a low of $ 3,800 in March.
An analyst is currently noticing that there is a prominent correlation between the distribution model seen last year and currently being formed.
“90-day distribution at $10k – $13k vs 60-day current range for BTC”.
Source: Cold Blooded Shiller / Twitter
ETH has continued to trade in tandem with Bitcoin – resulting in it witnessing an extremely tight consolidation when its buyers and sellers get stuck.
The next trend will depend largely on its response to an important level located in the region below $ 200.
ETH may be technically weak and witness a decline independent of Bitcoin.
A supporting factor for this concept is the recent appearance of a scary Death Cross that has not been seen since March of last year as pointed out by trader ‘Teddy’.
“Confirmed, death cross here as well – didn’t happen since March.”
Source: Teddy / Twitter
This formation can cause Ethereum to drop to its key high-time support level at $ 210.
Analyst ‘Cactus’ believes that reactions at this level will determine the future of cryptocurrencies.
“ETH intent for $ 350 this year in my opinion … As long as we hold $ 210 this is still valid. Thinking we flip $ 350 and see $ 500 taken out next year.”
Source: Cactus / Twitter
The correlation between XRP and BTC is still higher than ever (0.87) as illustrated in the chart below.
That being said, any sharp decline in Bitcoin will have a ripple effect on XRP. Bitcoin is currently oscillating in a tighter range of $ 9,124 and $ 8,900, which means a major move is getting closer. All analyzes point to Bitcoin’s decline and such a move could cost XRP critical support of $ 0.17.
Besides Bitcoin, Cardano has quickly become one of the most popular cryptocurrencies in recent weeks.
The data shows that ADA has increased by 150% since the beginning of 2020, many times ahead of Bitcoin and other major assets.
According to analyst ‘Nik Patel’, the ADA continues to appear optimistic, seeking support in the [important] region.
Patel wrote in the June 29 “Market Outlook” edition that since the ADA keeps an important uptrend, it is likely to rise higher.
“Looking at the daily, trendline support has remained rock solid since March capitulation, and resistance continues to be turned to support. I am expecting a continuation of the rally to follow, with $0.11 as the next area of trouble.”
Source: Nik Patel
The bullish view is reinforced by the Shelley update. The upgrade will make the network more decentralized and usable and will also deploy Proof of Stake – a feature that some people expect will push ADA higher.
However, not everyone is convinced of Cardano’s bull case.
Trader ‘Cold Blooded Shiller’ shared the image below, showing that the strong performance of the ADA actually hides the signs of a drop. The chart shows a divergence has formed, which is trending higher and the indicator is decreasing.
“The reason I’m building the ADA short here. If we invalidate the divergence I’m happy to step out the way. Until then I’ll continue to slowly build this position until the div confirms, at that point, I can ramp up.”
Source: Cold Blooded Shiller / Twitter
An extremely similar divergence that was discovered before Cardano dropped by ~ 75% against Bitcoin in 2019 brought confidence to the bear case.
Tezos has failed to attract enough traders to maintain its momentum. XTZ / USD fell $ 0.17, or 6.96%, from the second opening level to trade at $ 2.29.
On July 1, Bolt Labs launched a private payment solution zkChannels atop Tezos’s blockchain, indicating the need for its native token, XTZ.
The news comes as XTZ / USD is still trading 70% higher over the annual time frame (YTD).
But its appearance coincided with the confluence of bearish indices – both basic and technical.
At first, XTZ reversed violently from the YTD top near $ 3.22. The downside correction did not see a response from the bulls. Ultimately, XTZ broke below its support of the ascending trend and formed a super-anticipated Death Cross between 20-DMA and 50-DMA.
The decline also occurred when the Tezos Foundation agreed to settle a lawsuit from law firm Block & Leviton for a whopping $ 25 million. Traders may have explained that the Tezos founders will initiate a major sell-off of XTZ to pay the plaintiff, which has increased its downward trend.
XTZ is currently just above the support level of make-or-break 200-DMA (orange waves). If the cryptocurrency breaks below it, then the sell-off may continue towards $ 1.85, a historic price for the altcoin.
LINK is trading 169% higher on its YTD time frame when both its fundamental and technical indicators are bullish. Less than 24 hours ago, Singapore-based Huobi announced that they would run a Chainlink node.
Meanwhile, on June 30, blockchain-enabled game company Polyient Games announced that it would use blockchain Chainlink to distribute rewards to users.
LINK is very strong technically, with the price holding above specific levels of support.
LINK / USD continues the higher trend while maintaining support on its ascending trend line. The pair also kept a stable price on 20-DMA, with its 50-DMA lurking way below to even attempt a Death Cross formation.
- There is a crucial indicator suggests that bearish undercurrent has formed as Bitcoin price has consolidated around $9,000
- A maintained defense of $210 could be enough to allow ETH price to garner some significant upwards momentum