In the weekly chart, the trend has not changed. It is still bearish with clear formation of Lower Highs along the trendline.
Chart Courtesy: Tradingview
Ethereum since 2021 beginning has rallied a lot if we compare it with what it was in 2020. This build-up was arguably due to its prolonged much anticipated ETH 2.0. While the hype has ended, Ethereum somehow kept trading within a comfortable range of the 1200-1700 zone.
The recent news around FTX has unwinded the bear again. This time the momentum is strong. Once BTC and ETH were looking like consolidating and building their base before making the next stride in the next bull run. But as of now, it appears like it's not done yet. Maybe we might see the major coins refreshing their low. BTC is currently trading at a crucial level 17400 zone, this was exactly the low of the 2022 bear run.
Similarly, ETH is trading at 1200 down from 1700, and this drop is so sharp and quick that this momentum might cause some further damage to visit the 1000 level.
Chart Courtesy: MT4
That said, it is not just about BTC or ETH, rather the entire crypto space has seen a bloodbath in the last 24 hours. Even Hive the most resilient coin of this bull/bear cycle seems to be giving up. For Hive 0.33 level is very very crucial, if Hive gives up this level it might change the entire technical chart for Hive, and daily and weekly close below 0.33 might create 0.33 as resistance for Hive in the short/medium term.
Interestingly, in the traditional market, there has been some healthy upward correction in EUR, GBP, AUD, and GOLD against USD. In fact, it has been rallying since Friday(the last NFP day). So I guess, if there were no FTX fiasco in the crypto sphere, we might have witnessed a similar rally in the crypto market too considering that crypto for quite some time has been mirroring the broader market sentiment of the traditional market.
Chart Courtesy: Tradingview
Whatever be the case, if BTC closes below the 17000 level will open up the door for a visit to 15000 followed by the 12000 level, which will further trigger another route for all crypto. Even those they are strong demand zones, the chart setup from a technical perspective will change. So the TA traders might closely follow such important levels both in BTC and ETH.
The more interesting scenario would be SOLANA from a technical perspective. We all know how it rallied from 1 USD to more than 250 and then it suffered altitude sickness. But this sickness is so acute that the downward resumption looks even more interesting and technically valid that its upward revision.
Let's have a look at this chart of SOL, it has clearly formed a head and shoulder pattern and if BTC continues to cascade and prints a fresh low in 2022, it would trigger a similar breakdown in the overall crypto market. SOL has been the one to piggyback the down move.
Chart Courtesy: Trading view
The head and shoulder pattern for SOL- The head at $253, and the shoulder at $129. It is currently trading at $18. Since there has been a clear breach of the neckline, this is a perfect and ideal condition for the head and shoulder and pattern and it is in fact very close to reaching its target which is $5.
The distance from the neckline to the head generally extrapolates a similar distance once the neckline breaks. So this thesis holds good, then it should reach a value $129-($253-$129)= $5. That should be the ideal target for SOL.
In hindsight, if we analyze then surely the steep upward move of SOL was a delusion to hunt the retail and naive traders. It's indeed a trap for those who have bought SOl at around 150-200 levels.
Chart Courtesy: MT4
Look at Gold and how healthy the rally is. It touched a low of 1620 and then it was all a non-stop rally of $95 to reach the 1715 level. Unfortunately, it's not the case with crypto. Crypto from the last two days is having a bad time. I wish it does not cause further damage. However, it's equally an opportunity for long-term traders, in fact, long-term traders are always unabated by such moves if they have identified their long-term range and have accordingly strategized their position.
Disclaimer:- This article is intended for educational and analytical purposes only. It should not be construed as financial advice. Thank you.
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