- Bitcoin dropped below $10000 but holds key support
- Litecoin with a chance for a bigger upward move
After reaching the highest level of the year at $10450, Bitcoin launched a correction. However despite slight pullback, cryptocurrencies still trade much higher against the beginning of the year. Let’s take a closer look at the technical situation on BTC and LTC charts.
Despite the correction we have seen in the last few days, cryptocurrencies are trading in upward trend since the beginning of the year. Market cap of Bitcoin (BTC) is above $175 billion (10 billion less than last week) and Ethereum (ETH) market is worth $22.5 billion. Ripple (XRP) holds the third spot with an almost $12 billion market cap. Source: coinmarketcap.com
Start investing today or test a free demo
Create account Try a demo Download mobile app Download mobile appBTCUSD
Firstly, let’s look at the technical situation on Bitcoin chart. Taking a look at H4 interval, one can see that upward move slowed down and the price returned below a key psychological barrier at $10000. In addition, BTC broke below the upward channel and threatens to make a bigger downward correction. However, the drop was halted by buyers at the lower limit of Overbalance structure at 9500$ which should be considered a key support for now. As long as the price sits above it, bulls seem to be in markets’ favour. On the other hand, a break below it may change the mid-term sentiment to bearish.
BITCOIN H4 interval. Source: xStation5
LTCUSD
Looking at Litecoin chart, one can see that the upward move led to invalidation of the Overbalance structure. Following a break above the upper limit of 1:1 structure, the $63 handle should be considered a key support. This level is also being strengthened by previous price reactions. As long as the price sits above, continuation of the upward impulse is the base case scenario. The key resistance lies at $103 handle and is marked with 61.8% Fibonacci retracement of the downward swing started in June 2019.
LITECOIN D1 interval. Source: xStation5
The content of this report has been created by XTB S.A., with its registered office in Warsaw, at Prosta 67, 00-838 Warsaw, Poland, (KRS number 0000217580) and supervised by Polish Supervision Authority ( No. DDM-M-4021-57-1/2005). This material is a marketing communication within the meaning of Art. 24 (3) of Directive 2014/65/EU of the European Parliament and of the Council of 15 May 2014 on markets in financial instruments and amending Directive 2002/92/EC and Directive 2011/61/EU (MiFID II). Marketing communication is not an investment recommendation or information recommending or suggesting an investment strategy within the meaning of Regulation (EU) No 596/2014 of the European Parliament and of the Council of 16 April 2014 on market abuse (market abuse regulation) and repealing Directive 2003/6/EC of the European Parliament and of the Council and Commission Directives 2003/124/EC, 2003/125/EC and 2004/72/EC and Commission Delegated Regulation (EU) 2016/958 of 9 March 2016 supplementing Regulation (EU) No 596/2014 of the European Parliament and of the Council with regard to regulatory technical standards for the technical arrangements for objective presentation of investment recommendations or other information recommending or suggesting an investment strategy and for disclosure of particular interests or indications of conflicts of interest or any other advice, including in the area of investment advisory, within the meaning of the Trading in Financial Instruments Act of 29 July 2005 (i.e. Journal of Laws 2019, item 875, as amended). The marketing communication is prepared with the highest diligence, objectivity, presents the facts known to the author on the date of preparation and is devoid of any evaluation elements. The marketing communication is prepared without considering the client’s needs, his individual financial situation and does not present any investment strategy in any way. The marketing communication does not constitute an offer of sale, offering, subscription, invitation to purchase, advertisement or promotion of any financial instruments. XTB S.A. is not liable for any client’s actions or omissions, in particular for the acquisition or disposal of financial instruments, undertaken on the basis of the information contained in this marketing communication. In the event that the marketing communication contains any information about any results regarding the financial instruments indicated therein, these do not constitute any guarantee or forecast regarding the future results.
