BTC/USD and XRP/USD still bearish but a recovery is on the way

FXOpen

BTC/USD

Last week on Monday, November 20th the price of Bitcoin was at $4977, the week’s highest point. From that high, the price went back to the levels from which the increase around $4500 was made and then continued to move to the downside. Measured to the current level of $3748 the price of Bitcoin has fallen by 24.65%.

BTC/USD and XRP/USD still bearish but a recovery is on the way

Looking at the hourly chart, you can see that the price action is indicating a downtrend even though it looks like the price has stabilized at around $3782, where the horizontal significant level is serving as support. Since the price interacted with the level for the third time in the last couple of days, currently we are seeing that the price is below the mentioned level.

This indicates sellers pressure on to the price support level. Hence, we might see another breakout to the downside where the next horizontal support level at $3494 would be a target for the support zone as well as the completion of the down move. Last week the price broke out from the symmetrical triangle or a bearish pennant. It resulted in a breakout from the downside. Since then the price action structure has looked like the 5 waves impulsive move is almost up.

The 5th wave could have ended on the mentioned horizontal support level on today’s interaction. It could also very likely be that the 5th wave ends on the next horizontal level at around $3500. But in either case, I would be expecting a quick recovery as the down move clearly has a bit more room before its end.

Zooming out to the 4-hour chart, you can see that the 5 waves are the sub-waves from the last corrective Z wave, counted from the previous breakout at around $6500.

BTC/USD and XRP/USD still bearish but a recovery is on the way

Since the price has fallen by around 42% measured from $6493 to the current levels, the price can’t go much further down without having to recover first and retest the prior support for the resistance. Soon I would be expecting that the price starts increasing and the fist most significant resistance line I would be looking at for a rejection is at $4509. This is the area from the breakout off of the descending channel baseline support (bold black line) and the minor horizontal significant level.

XRP/USD

From last weeks high at $0.4811 the price of Ripple has fallen by 26.59% measured to the current levels of $0.3525.

BTC/USD and XRP/USD still bearish but a recovery is on the way

As you can see from the hourly chart, the price has been trending down since November 18th. Since the downtrend line hasn’t been broken (purple line) and the price is on the support level from the descending channel clearly seen on a higher time-frame, we are going to see which pattern proves to be more dominant.

Zooming out to the 4-hour time frame, you can see the mentioned descending channel more clearly as well as my Elliott Wave projection.

BTC/USD and XRP/USD still bearish but a recovery is on the way

The current down move has been labeled as the second X wave from the second Minor WXY correction or the wave Y from the Intermediate count. I would be expecting that the price recovers from here or moves to another low and recovers from there, similarly like in the case of Bitcoin.

The horizontal level I would be looking for when the price starts increasing is at the 0.236 Fibonacci retracement level. The crossing of the Fibonacci level would mean that the price can potentially go higher than it was projected for the recovery wave Y. It will depend on were the price currently finds support – the lower the support the lower the recovery.

 

FXOpen offers the world's most popular cryptocurrency CFDs*, including Bitcoin and Ethereum. Floating spreads, 1:2 leverage, 30% margin call, 0.01 lot minimum transaction size with no maximum — at your service. Open your trading account now or learn more about crypto CFD trading with FXOpen.

*At FXOpen UK and FXOpen AU, Cryptocurrency CFDs are only available for trading by those clients categorised as Professional clients under FCA Rules and Professional clients under ASIC Rules respectively. They are not available for trading by Retail clients.

This article represents the opinion of the Companies operating under the FXOpen brand only. It is not to be construed as an offer, solicitation, or recommendation with respect to products and services provided by the Companies operating under the FXOpen brand, nor is it to be considered financial advice.

Latest from Cryptocurrencies

BTC/USD Analysis: New High for the Year Shows Bulls Are Indecisive Market Analysis: Results of Black Friday in Financial Markets BTC/USD Analysis: Bulls Preparing New Assault on 37,500 Level? BTC/USD Analysis: Bears Aggressively Defending 37,500 Level BTC/USD Analysis: JP Morgan Analysts Warn of a Possible Correction

Latest articles

Forex Analysis

European Currencies at Strategic Levels

The downward trend in the US currency continues to gain momentum. Thus, the euro/dollar pair yesterday tested important resistance at 1.1000, the pound/dollar pair strengthened to 1.2700, and the usd/cad pair fell below 1.3600.

Indices

Market Analysis: Stock Market Reaction to US GDP News

According to data released yesterday, the US economy is growing at a stronger pace than expected. Thus, US GDP in the 3rd quarter increased by 5.3% in annual terms (an increase of 4.9% was expected). Combined with softening

Cryptocurrencies

BTC/USD Analysis: New High for the Year Shows Bulls Are Indecisive

During November, the price of bitcoin increased by approximately 10% in anticipation of the launch of a bitcoin ETF. But the positive sentiment of crypto investors is seriously overshadowed by news regarding Binance: → Changpeng Zhao resigned as head of Binance.

CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. CFDs are complex instruments and come with a high risk of losing money rapidly due to leverage. 60% of retail investor accounts lose money when trading CFDs with this provider. You should consider whether you understand how CFDs work, and whether you can afford to take the high risk of losing your money.