The price trend of Bitcoin is showing bearish momentum on the RSI indicator, indicating a decline in the future. Ethereum price is facing resistance near the $4,000 level, hinting at an upcoming pullback. Ripple price has rejected the $2.66 resistance level, suggesting a decline is imminent.
Bitcoin (BTC), Ethereum (ETH), and Ripple (XRP) are all facing resistance at important levels, suggesting a pullback in the coming days.
Bitcoin bulls are showing signs of exhaustion
Bitcoin price reached an all-time high (ATH) of $104,088 on Thursday. The stock then plummeted to the day's low of $90,500, but recovered on the same day to close above $96,900. BTC rose 4.3% in the three days to Sunday. As of this writing on Monday, it is down slightly around $99,500.
Despite recovering from Thursday's decline and rallying through Sunday, Bitcoin's Relative Strength Index (RSI) is flashing red flags. The higher high formed on Thursday does not reflect the RSI chart for the same period and indicates the formation of a bearish divergence, which often leads to a short-term correction.
If this bearish divergence plays out, traders could expect a modest rally (either gaining liquidity or a long trap) towards the recent high of $104,088, followed by a sharp decline towards the $90,000 support level. There is a gender. A close below this level could open up further declines towards the next support level at $85,000.
BTC/USDT daily chart
However, if BTC continues its upward trend and closes above $104,088, it could extend the rally towards an all-time high of $119,510. This level coincides with the 141.4% Fibonacci extension from the November 4 low of $66,835 to Thursday's all-time high of $104,088.
Ethereum price is set for a rebound as it faces $4,000 resistance
Ethereum price rose 8% last week and retested the $4,000 level on Friday. However, it faced resistance near this level over the weekend. As of this writing on Monday, it is trading at around $3,948.
If $4,000 continues to hold as resistance, ETH could extend the decline and retest the intraday support level at $3,721.
The RSI on the daily chart is reading 69 and has turned downward after rejecting the overbought level of 70, suggesting weaker bullish momentum.
ETH/USDT daily chart
However, if ETH rises and closes above $4,000, the rally could extend and re-attempt the $4,200 level.
Ripple price is set for decline
Ripple price is facing resistance near $2.66 on Sunday. As of this writing on Monday, it is down slightly at around $2.47.
If the $2.66 level continues to hold as resistance, XRP could extend the decline to retest the psychologically important level of $2.00.
The RSI on the daily chart is 70, hovering around the overbought level of 70 and trending downwards, indicating weaker bullish momentum. If the RSI breaks out of overbought territory, it could be a clear sell signal.
XRP/USDT daily chart
On the other hand, if XRP rebounds and closes above the $2.66 level, the rally could extend to retest the psychologically important level of $3.00.
Frequently asked questions about Bitcoin, altcoins, and stablecoins
Bitcoin is the largest cryptocurrency by market capitalization and is a virtual currency designed to function as money. This form of payment is not controlled by any particular person, group, or entity and eliminates the need for third parties to participate during financial transactions.
An altcoin is any cryptocurrency other than Bitcoin, but some consider Ethereum to be a non-altcoin because it is these two cryptocurrencies that forks occur. If this is true, Litecoin would be the first altcoin to fork from the Bitcoin protocol and thus be an “improved” version of it.
A stablecoin is a cryptocurrency that is designed to have a stable price, and its value is backed by the reserves of the asset it represents. To achieve this, the value of one stablecoin is pegged to a commodity or financial instrument, such as the US dollar (USD), and its supply is regulated by an algorithm or demand. The main purpose of stablecoins is to provide an on/off ramp for investors who wish to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value, as cryptocurrencies are generally volatile.
Bitcoin dominance is the ratio of Bitcoin's market capitalization to the market capitalization of all cryptocurrencies combined. This clearly shows the interest in Bitcoin among investors. BTC's dominance typically occurs around bull markets, where investors turn to relatively stable, high-market-cap cryptocurrencies like Bitcoin. Decreasing BTC dominance usually means investors are moving their capital and profits to altcoins in search of higher returns, which usually causes an explosive rally in altcoins.
