The cryptocurrency market experienced a slight cooldown today, with the total market capitalization falling 1.14% to $2.76 trillion according to Coingecko. This small correction follows significant moves in the market over the past few days as Bitcoin and Ethereum face resistance at key levels.
Bitcoin, the world's leading cryptocurrency, has been trying to break the $70,000 barrier. However, this level has proven to be strong resistance, with breakouts often followed by corrections affecting the broader crypto market. Today, Bitcoin saw a 1.2% drop, with the coin hitting a daily high of $71,754 before correcting to $69,793. Despite the recent decline, Bitcoin's overall performance remains bullish as it continues to recover from a Flash failure on BitMEX that caused the price to plummet to $60,760.
The current daily candle suggests a possible correction, but the overall trend remains bullish.
Bitcoin price is trading above its EMA10, a positive sign for the coin because it indicates that at current prices, any investor who has bought in the last 10 days should be in the green. Given that 97.7% of BTC addresses are in-the-money according to data provided by IntoTheBlock, some short-term traders may be considering cashing in their profits, while long-term hodlers may still be forced to keep their tokens locked. and see how the markets behave. In terms of indicators, the recent market cooling has brought balance to the markets. The Relative Strength Index (RSI) remains slightly bullish at 58, indicating a well-balanced market compared to 72 points recorded on March 14, when Bitcoin was trading at a similar price. This can allow for safer bullish bets on strategies that take market sentiment into account.
The average directional index (ADX) has fallen to 30 points, indicating that while bullish sentiment persists, traders are more cautious and rallies are not as extreme as in previous days. If Bitcoin fails to gain momentum, immediate support lies around $67,800, set by the EMA10. However, if the bullish momentum continues, resistance is expected between the psychological zone of $70,000 and the all-time high of $73,794.
Ethereum, the second largest cryptocurrency by market cap, is showing similar behavior to Bitcoin.
The coin is currently trading at $6,543, having risen to $3,663 before correcting to a low of $3,495 today. Overall, Ethereum is down 1.35% in the last 24 hours. The coin has been facing strong resistance at $3,660 for the past three days, and the overall pattern shows more stability. This is not good for scalpers and day traders who are thinking about opening long positions.
Ethereum remains bullish, but the gap between EMA10 and EMA55 is rapidly closing, which could indicate that a price correction is still in play. The RSI has fallen to 52, suggesting that the markets are currently indecisive, with no clear dominance of either the bulls or the bears.
The ADX (which measures the strength of a trend) at 38. Combined with a compression momentum indicator, which guesses the phase of the market cycle in which an asset is trading, it shows that the bears are not yet giving in to a bounce of prices. It also shows that traders may still be struggling to recover from the correction that began on March 12, which caused the price of Ethereum to drop nearly 25%, from $4,095 to $3,059.
While both Bitcoin and Ethereum are facing resistance at key levels, their overall trends remain bullish. However, traders thinking about opening long positions on short time frames should be cautious as the recent corrections are strong enough to prevent the coins from continuing their path towards the price discovery zones once again.
Edited by Stacy Elliott.
