Cryptocurrencies Enter Range-bound Period

FXOpen

All of the four crypto-currencies we follow have now entered a consolidation period. Peercoin had a sharp correction of almost 24 percent after last week’s 44% surge. Namecoin also declined, by 28 percent when measured high to low. The consolidation period is largely fueled by big brother bitcoin. The crypto has been trading in a tight $5 dollar range for the past four days now.

Peercoin Corrects by 24 Percent

Alternative cryptocurrency Peercoin had a sharp correction of almost 24 percent in the past seven days. After hitting a high of $0.422 last Tuesday, PPC retraced all the way down to $0.321, erasing most of the gains from the 44% surge. But staying true to the consolidation phase, the crypto didn’t stay down for long and is currently quoted at $0.369.

PPCUSDDaily-sep17

The correction shouldn’t come as a surprise to our readers. Last week we cautioned that the 44% rally seems overdone:

”At this point the gains are already very large in percentage terms. Also as we’ve repeated few times before, downtrends rarely switch directly into successful uptrends, without a longer consolidation period in between. A better scenario for the bulls would be to wait for a decisive break above the 43 cents level.”

Waiting for a clean break above the $0.43 level is still the better plan of action for the bulls. Close-by we find another resistance figure at $0.465, the starting point for the August downtrend. This previous support should now turn to resistance. And not to be forgotten, the round 50 cents mark is another notable resistance level. On the downside, we will need to see a break below the $0.291 swing low to start a new downtrend.

Namecoin Enters Consolidation

Namecoin has entered its own consolidation. The cryptocurrency also saw a sharp correction during the past seven days, from $0.462 to $0.332. But same as with Peercoin, the losses didn’t last and NMC/USD is currently quoted at $0.372, 12 percent above this week’s low.

NMCUSDDaily-sep17

To start a new uptrend, the swing high at $0.463 has to give. Higher up, the round $0.50 level may also act as resistance. This is followed by the 55 cents level, former support now turned to resistance. On the lower end, a decisive break below the 30 cents level would technically start a new downtrend. But right below here we find two more support levels near the previous swing lows of $0.274 and $0.286. A clean break below the 27 cents figure may be needed to see a sustainable NMC downtrend.

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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.

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