The bearish momentum hasn’t ended in the cryptocurrency market just yet. After the two bearish legs down in the market during the last 2-3 weeks, cryptocurrencies made some decent gains in the last two days, after the reversal, which gave the impression that the decline was over in cryptocurrencies and the reversal was underway already.
But, today we are seeing another crash lower. In fact, we are in the middle of it, as cryptos are still declining, but I think they might have reached the bottom again, if this is a technical move. Otherwise, the decline might continue, if there is a stronger reason for this crash. I am having a look around to see if I can find any other reasons for the crash, and will let you know if I find one.
Bitcoin Crashes $4,000 Lower
Bitcoin heading toward $40,000 again
Bitcoin climbed above $50,000 in August, during the bullish period, and it got pretty close to $53,000 early this month. But, the bearish reversal came, and BTC/USD fell below $50,000 in a quick move during the flash crash more than two weeks ago.
The 200 SMA (purple) held as support for some time, helped by the 50 SMA as well on the daily chart, but it got broken on the second bearish wave, which took place on Monday and Tuesday this week. However, the 100 daily SMA (green) came to the rescue and stopped the decline for Bitcoin. In the last two days we saw Bitcoin put up a decent fight, as it bounced from below $40,000 to $45,000, but, the crash today has taken the price down to nearly $40,000 again, so let’s see if the 100 SMA will hold today’s crash as well.
Ethereum Crashes Below $3,000 Again
The 100 and 200 SMA stand as support for the time being
Ethereum was looking even stronger than Bitcoin during the bearish period from late July until early September, as it gained around $140% in value, climbing above $4,000. But, buyers couldn’t hold the price above that big level, and the bearish period came, which sent Ethereum below $3,000 in the second wave.
The 50 SMA (yellow) was holding as support on the daily chart after the first round of selling earlier this month, then the 200 daily SMA (purple) was providing support during the second crash. In the last two days, we saw some decent bullish momentum, taking ETH/USD above $3,000, but today’s crash has sent the price towards the 200 SMA again. So, let’s see if there is more to this decline than just technicals. If so, the 200 SMA might be broken, but we’re following the price action for now.
Litecoin Testing the Support Zone Around $1,45
LTC/USD threatening the $145 support zone
Litecoin is looking even more bearish than the other two cryptocurrencies now. The 200 SMA was acting as resistance for LTC/USD, despite the two jumps above it, both of which failed, causing the price to reverse back down. If something can’t go up, it will eventually go down.
So, the crash took Litecoin before the first support at $160 and pushed it down to the second support around $145, where the 100 SMA (green) was standing. The price bounced higher on Wednesday, but we didn’t see any follow-through yesterday, like we did in other cryptos, which was the first bearish signal. Today, the reversal took the price below the $145 support, but buyers gave it a little push higher. So, this level is under attack now, and if it breaks, it will open the door for further losses, so we are watching this support area.