The major cryptocurrencies are all trading slightly higher today, following two bearish days that brought them back down to last week’s lows. For now, another breakdown has been avoided, despite the overwhelmingly bearish broader picture. The modest bounce left the trend model on sell signals across the board, and odds continue to favor new lows in the coming period, so I believe traders and investors should remain defensive here.
The top coins are trading well below their weekend bounce highs, and without new swing highs, the short-term trend also remains clearly bearish, even considering the deeply oversold long-term momentum readings and the abysmal sentiment. So, while a larger-scale bounce remains possible in the coming weeks, perhaps following a failed breakdown pattern, bulls should still be patient until we see clear improvements.
With that in mind, I’d suggest traders and investors shouldn’t enter positions even in the slightly stronger coins, as odds still favour the continuation of the bear market with new lows likely in the coming days. A successful test or a failed breakdown could trigger a larger-scale correction, with the broader picture still being deeply oversold and with investor sentiment still being very negative.
Bitcoin rallied as high as $3,450 in the last 24h, but it failed to get close to the $3,600 resistance and the weekend high, so the short-term downtrend remains intact despite the bounce. For now, there is no sign of an imminent rally, with all eyes on the $3,000 level in Bitcoin.
Ethereum is stuck below the key $95-$100 zone even following today’s bounce, keeping the coin on a short-term sell signal. Odds still favour a move towards the next major support zone between $73 and $75, and only a quick recovery above the primary resistance zone could change the short-term trend.
Ripple only experienced a weak bounce, and although it continues to trade near the $0.30 level, the coin is still among the relatively weak coins from a short-term perspective, and the renewed long-term sell signal is also in place.
I still expect a move towards the prior bear market low near $0.26, so I wouldn’t personally enter positions here.
Disclaimer: The views and opinions expressed by the author should not be considered as financial advice. We do not give advice on financial products.