Recent days have seen some calming in the cryptocurrency market sentiment. Most of the projects’ ratings neither fell noticeably nor rose.
Looking at the Bitcoin quotes, we notice that the price of the oldest virtual currency has increased in recent days to a technical resistance of $ 41,000 and measuring 38.2 per cent. Fibonacci correction from an earlier downward impulse. It was there that the supply reaction appeared, as a result of which we saw drops again over the next few days.
It is worth noting that the BTC price has been around $ 30k–41k for some time, and it is possible that after such dynamic declines, which we saw between May 10 and 19, this trend will continue. This fact allows the market to continue the current consolidation for the next few days and for weeks to come.
Only a directional breakout from this form will determine whether the bitcoin quotes will return to increases or perhaps they will drop to around $ 20,000. It should be mentioned, however, that consolidations are corrective formations. It means that statistically, more often, the market breaks out of them in the direction consistent with the earlier impulse, which in this particular case increases the probability of a drop below $ 30,000.
However, this is only a particular statistic, which means that the actual chances of continuing the decline are realistic. As long as the BTC price does not drop below $ 30,000, this is a strictly hypothetical scenario.
The current situation on the Ethereum quotes is also quite similar, the price of which rebounded last week from the technical resistance of $ 2,900. Although the subsequent declines did not reach the horizontal support of $ 1960, it is possible that yesterday’s increases will only turn out to be a temporary recovery, after which the rate will return to declines.
Generally speaking, after such dynamic declines as we observed from 12 to 23 May this year, we could expect some stabilization of the rate. However, in this case, the quotations can stay in the range between $ 1960 and $ 2900 for a long time (even several weeks). Therefore, only a directional breakout (up or down) from this consolidation will determine the direction of the future trend.
The Litecoin quotes are also almost identical, the price of which has been in the range of $ 120 to $ 216 for some time. Therefore, the range of movement is quite extensive, which may determine the increased daily volatility, although it is unlikely to be accompanied by a large momentum.
In practice, it may turn out that the LTC price will increase or decrease by as much as 8–10 per cent. During the day, although this tendency will be two-way, which means that the rate may rise one day and fall on the other. This fact will make volatility high indeed, but the market will continue to consolidate due to the lack of directional momentum.
Looking at the XRP quotes, we can see that the price of this cryptocurrency is currently approaching a technical resistance zone between $ 1.03–1.06. It is also a barrier that coincides with measuring 38.2 per cent. Fibonacci correction, which may determine the emergence of a larger supply response there, could contribute to the emergence of another downward move, for which even the area of technical support of $ 0.66 seems to be an actual reach.
It is also worth mentioning that even if there is no supply response around the nearest resistance and the zone will be permanently defeated, and it would not have to allow for further, large increases in practice. The trend line, which is the lower boundary of the earlier downward channel, is not much higher, which could constitute a significant resistance. So it seems that the potential for short-term increases in the XRP quotes is quite limited.
You can find more comments on the cryptocurrencies described above and analyse a few more in the market review from Geco.one on Comparic Markets TV.
