The major cryptocurrencies have all been trading under clear selling pressure today, as even though traditional financial markets are still closed, the negative virus-related headlines suggest that another gloomy Monday is ahead of investors. The large-scale lockdowns in Europe and the COVID-19’s quick spread in the U.S. all point to continued major economic disruptions and possible forced liquidations across asset classes as market participants continue to scramble for cash.
While the huge fiscal and monetary packages should favor cryptos in the long run, emotions and liquidations will likely lead to wild swings in the coming period, making short-term trading risky. That said, the technical picture is still mixed, and our trend model remains bullish for several majors from a short-term perspective, despite today’s dip. Traders should still only enter smaller speculative short-term positions though as downside risks remain high.
BTC/USD, 4-Hour Chart Analysis
BTC continues to be very strong from a short-term perspective, clearly holding up above the key $5,850 level and remaining on a short-term buy signal. While most of the altcoins failed to live up to BTC’s strength, the coin is holding up above its prior consolidation range, and bulls can still hope that a new short-term uptrend will be confirmed in the coming days, despite the downside risks.
BTC is on a short-term buy signal while being on a long-term sell signal in our trend model, with support found between $6000 and $6100 and near $5850, and with resistance is ahead near $6,500, $6,750 and $7,000.
ETH/USD, 4-Hour Chart Analysis
ETH dipped below the $130 support level today triggering a sell signal in our trend model. The coin is once again trading its post-crash consolidation range, still showing relative technical weakness. Volatility will likely pick up again as the traditional financial markets reopen for trading, and the weak rally attempt means that ETH will be vulnerable in the coming…