Red! Red Everywhere!
The week is going from bad to worse for cryptocurrencies. Yesterday bitcoin broke the important support level at $550 and proceeded to lose another 5% in the next few hours. The breakdown served as a catalyst to other altcoins. Litecoin fell below $5 per coin, Namecoin hit parity and Peercoin hit a daily low of $0.626 yesterday. With the latest down move, PPC has lost over 50 percent of its value in the last three weeks alone!
Bitcoin breaks important support at $550
Bitcoin broke the important support level at $550 yesterday. The area was tested on three separate occasions in the last 3 months thus it’s not a surprise that once it gave way, prices immediately lost over 5 percent. Where are the next support levels? With prices currently trading at $527 per coin, the next support can be found at the round psychological figure of $500. Lower still, the $411 swing low may provide some support. The yearly low at $342 will be an important milestone. If BTC/USD breaks below $342, bitcoin may enter a period of prolonged losses. As usual keep an eye on the 50 and 00 round figures between 300 and 450 ($350,$400,$450,$500).
Peercoin halves in 3 weeks
The value of one Peercoin has halved in the past 3 weeks. In my article posted on July 22nd I suggested that ‘’the constant slow creep toward $1.3 and the retesting of this level means that a break below this figure is likely going forward.’’
Three weeks later and PPC is currently trading at $0.70 per coin, after hitting a yearly low of $0.626 yesterday. It’s difficult to say where we will go from here. The selloff has been massive so I wouldn’t exclude a sizable retracement going forward. However I will rarely go against the trend and in this case even the momentum is strongly downward. Add to this the fact that bitcoin’s break below $550 may lead to more losses for the crypto and things are not looking good for Peercoin.
Some of the levels to watch out for are yesterday’s swing low at $0.626 and $0.78. On the high end, the August 12th swing low at $0.78 may act as resistance going forward. Both of these levels are still very much undefined. We will need more interaction with the price before dubbing them as significant support/resistance areas.