Technical Analysis June 18: Bitcoin, Ethereum, Bitcoin Cash, Litecoin and Ripple

The cryptocurrency bear market continues as the market has fallen $23 billion in the past seven days. This week, using technical analysis, we will try to figure out if the downward trend is continuing or fading.

Disclaimer: This article is not meant to constitute trading/investment advice. Please use extreme caution when trading any cryptocurrency.

For this article, we will be using a handful of terminology that non-technical traders may not be familiar with. These terms are at the end of this article under “Glossary.” If you would like to read those terms now, click here.

Bitcoin, currently ranked #1 by market cap, is down 1.59% over the past 24 hours. BTC has a market cap of $110.56B with a 24 hour volume of $3.23B.

Chart by CryptoCompare

Bitcoin is down 1.59% over the past 24 hours.

Bitcoin tumbled from $6800 to $6400 since last week, following a $750 drop in one day. Bitcoin is clearly trending downward so use caution if longing a bounce. Based off of support levels, Bitcoin is sitting on top of a key area. If it falls through its third retest, expect Bitcoin to head towards the $5,000 area.

Bitcoin Technical Analysis
Descending volume is still prevalent.

Adding a few more indicators to the picture, we can start to see the bigger picture. On the 6h chart, Bitcoin is below the cloud and testing the Tenkan-Sen.

Bitcoin RSI
Not much happening with RSI currently.

Looking at RSI, we can see there was textbook bullish divergence a few days back, which was followed by a $200 increase. RSI divergence is one of the strongest signals to trade on and is one of the best indicators for beginners to learn.

Ethereum, currently ranked #2 by market cap, is down 2.04% over the past 24 hours. ETH has a market cap of $49.64B with a 24 hour volume of $1.28B.

Chart by CryptoCompare

Ethereum is down 2.04% over the past 24 hours.

Despite the SEC saying the Ethereum is not a security, its downtrend is continuing. Ethereum broke through a past support level in the $500 area. If the downward trend continues, expect it to retest it’s mid-April lows around $380.

Ethereum Technical Analysis
Ethereum sitting under $500.

Ethereum is also under the cloud, Tenkan-Sen, and Kijun-Sen. Ethereum has come up to test the Kijun-Sen several times, so another attempt is not impossible. A TK-Cross formed in mid-May, which hinted at a continued downward trend.

Ethereum RSI
RSI hasn’t hit oversold since April.

Ripple, currently ranked #3 by market cap, is down 2.76% over the past 24 hours. XRP has a market cap of $20.48B with a 24 hour volume of $178.81M.

Chart by CryptoCompare

Ripple is down 2.76% over the past 24 hours.

Ripple is in a rough spot and has fallen from $0.60 to $0.52 in a week. Unfortunately for Ripple holders, the SEC has been quiet on Ripple’s status as a security.

Ripple Technical Analysis
Ripple headed towards a key level.

Ripple looks similar to the other cryptocurrencies with a slow downward trend towards April lows. As it nears the support level highlighted above, keep an eye out for a Tenkan-Sen and/or Kijun-Sen retest.

Ripple Ichimoku Cloud
Ripple is still below the cloud on the 1D.

Bitcoin Cash, currently ranked #4 by market cap, is down 2.72% over the past 24 hours. BCH has a market cap of $14.4B with a 24 hour volume of $300.02M.

Chart by CryptoCompare

Bitcoin Cash is down 2.72% over the past 24 hours.

Bitcoin Cash saw a drop from $940 to $830 this week. Bitcoin Cash is in a similar situation to Ethereum and seems to be headed towards its early April lows.

Bitcoin Cash Technical Analysis
Bitcoin Cash around a local support level and looks to be falling through.

Bitcoin Cash has been below the cloud since late May and doesn’t seem to be making a move above any time soon. The cloud has also turned bearish indicating a bearish future for Bitcoin Cash.

Bitcoin Cash Technical Analysis
Bitcoin Cash trending downwards.

Litecoin, currently ranked #6 by market cap, is down 3.23% over the past 24 hours. LTC has a market cap of $5.41B with a 24 hour volume of $239.67M.

Chart by CryptoCompare

Litecoin is down 3.23% over the past 24 hours.

Litecoin has seen a serious drop, falling under $100 for the first time since November of 2017. It is testing the green area, which was a past support level. Expect a bounce off this area, and then another bounce off the resistance.

Looking at the weekly chart, it’s also fallen out of a descending triangle, which is a strong sign that the downward trend is continuing.

Litecoin Technical Analysis
High probability trade on the bounce off green area.

Just like its cousins, Litecoin is also below the cloud, Tenkan-Sen, and Kijun Sen. Litecoin TK-crossed inside the cloud in mid-May, and has seen all downside since.

Litecoin Ichimoku
RSI was oversold for a few days and looks to be headed back down.

Conclusion

The global cryptocurrency market cap stands at $275.93B with a 24 hour volume of $9.95B. The Coinbase Index is currently sitting at 3024.53. Bitcoin dominance is currently at 40.07%.

Most cryptocurrencies are far below the cloud testing April support levels. If these levels don’t hold up, expect to see major capitulation.

From a fundamental analysis point of view, most would expect cryptocurrency markets to see an increase after the SEC declared Bitcoin and Ethereum to not be securities. This change not only affects the mentioned currencies but their popular forks Bitcoin Cash and Ethereum Classic. However, the downward trend proves to be clear, as bullish news had little effect on the markets.

As always, use caution when trading and do your own research before investing in or trading cryptocurrencies. This post is simply an interpretation of the current market and has no guarantees of playing out as expected.

To see some more cryptocurrency and trading-related content, follow Austin on Twitter.


Glossary

Here are the definitions for each of the technical analysis terms used in this article.

  • Senkou Span A – an indicator that is used to measure momentum, as well as future areas of support and resistance. Senkou Span A is always drawn in relation to Senkou Span B – together, they form the cloud.
  • Senkou Span B – forms the cloud along with Senkou Span A. Traditionally when Senkou Span B is located below Senkou Span A, it is a symbol of bullish price movement.
  • Senkou Span cross – The cloud is an area of uncertainty. Most traders do not make a move until price closes above or below the cloud – although, when the Senkou Spans cross one another, many traders use the indicator to predict the reversal of a current price trend.
  • Kumo Twist – The Ichimoku Cloud is a Japanese trading strategy, and ‘Kumo’ means cloud in Japanese. The Kumo Twist is just a nickname for a Senkou Span cross.
  • Tenkan-Sen – The Tenkan-Sen is used in conjunction with the Kijun-Sen to predict long and short positions. The formula for the Tenkan-Sen’s calculation takes the highest high and the lowest low and divides it by two over the last seven to eight time periods.
  • Kijun-Sen – Similarly to the Tenkan-Sen, the Kijun-Sen is calculated using the same formula, but it usually includes the last 22 time periods. The Tenkan-Sen highlights short-term price movement, while the Kijun-Sen gives a better idea of long-term price movement.
  • TK crossover – When the Tenkan-Sen crosses above the Kijun-Sen, it is an indication of bullish price movement. Conversely, the Tenkan-Sen crossing below the Kijun-Sen is a bearish sign. Both of these signals are known as a TK crossover. The location of the TK crossover impacts the strength of the signal. For example, a bullish TK crossover below the cloud is in bearish territory, and therefore a weak signal. On the other hand, a bullish TK crossover above the cloud is a strong signal.
  • Chikou Span – Otherwise known as the Lagging Span, Chikou Span shows where the price was 26 periods before the most recent closing price. An upwards Lagging Span above price shows bullish momentum, while a Lagging Span below price shows bearish momentum.
  • Volume – Is the amount of a stock, currency or asset exchanged in a given period of time. This can be expressed in terms of the unit (ex. Bitcoin) or standardized in terms of a currency such as dollars.
  • Momentum – Momentum measures the strength or rate of acceleration of price action.

Cover Photo by Sonaal Bangera on Unsplash

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Austin Tuwiner Author

Austin Tuwiner

Austin is an avid cryptocurrency investor studying computer science and software engineering at Towson University. His hobbies include researching cryptocurrencies, travel, and rock climbing. His goal is to help the average person understand and get into into cryptocurrency.

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