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Bitcoin price drops below $9,000, Ethereum and XRP following

Bitcoin price drops below $9,000, Ethereum and XRP following

Disclaimer: This article contains technical analysis, which is a methodology for forecasting the direction of prices through the study of past market data, primarily price and volume. The content presented in this article is the opinion of the author. None of the information you read on CryptoSlate should be taken as investment advice. Buying and trading cryptocurrencies should be considered a high-risk activity. Please do your own diligence and consult with a financial advisor before making any investment decisions.

Bitcoin just moved below $9,000 and is bringing the rest of the market down with it. Over the last 40 hours, Ethereum plunged over 6 percent, while XRP plummeted nearly 14 percent. The following technical analysis will evaluate where these three cryptocurrencies could be heading next. 

Bitcoin (BTC)

Bitcoin has been consolidating within a descending parallel channel since June. 26. Since then, every time this cryptocurrency reaches the bottom of the channel, it bounces off to the middle or the top. But, when it reaches the top, it falls back to the middle or the bottom.

At the moment, BTC is retracing after hitting the top of the channel. A move down to the middle or the bottom of the channel could now be expected, as it has happened in the last four months. 

Adding to the bearishness, the moving average convergence divergence (MACD), which is commonly used to follow the path of a trend and calculate its momentum, appears to be turning bearish. As the 26-day exponential moving average crosses over the 12-day exponential moving average, the probability for a downward movement increases.

As a result, Bitcoin is going down to test the support given by the 50-day moving average, which is sitting around $8,600. This is the same area where the 50 percent Fibonacci retracement level and the middle line of the descending parallel channel sit. Consequently, the zone between $8,600 and $8,100 poses a significant amount of support that could hold the price of BTC from a further correction. 

This area could serve as a rebound point for Bitcoin that takes it to test the top of the descending parallel channel once again. But, an increase in the selling pressure behind BTC could prolong the consolidation period and trigger a move down to the bottom of the channel that sits at $6,900.

BTC US dollar price chart
BTC/USD by TradingView

Despite the bearish outlook, Bitcoin remains bullish on the long-term perspective. A bull flag has been developing on its 3-day chart since late March. This is considered a continuation pattern that formed after Bitcoin surged to nearly $14,000, known as the flagpole, and was succeeded by the current consolidation period, known as the flag, which could result in a breakout in the same direction of the previous trend.

Ethereum (ETH)

Based on its 3-day chart, Ethereum appears to have formed a double bottom or “W” pattern around the 75 percent Fibonacci retracement level. This technical formation developed as Ethereum plummeted to $153 on Sept. 26, surged to $198 on Oct. 11, and then pulled back again to $153 on Oct. 23. While ETH’s price behavior formed a “W” shape, the double bottom estimates a change in trend and momentum from bearish to bullish.

ETH US dollar price chart
ETH/USD by TradingView

Despite the optimistic view, ETH is consolidating since late October between $180 and $192. Thus, this area can be considered a no-trade zone. Breaking outside of this trading range will determine where Ethereum is heading next.

On the downside, this crypto could plunge to $168 or $157 if it closes below $180. But, a spike in volume could take Ethereum to surge above $192 targetting a move to $207 or even to the 50 percent Fibonacci retracement level that sits at $223.

XRP 

XRP is trending down despite the expectations that Ripple’s Swell generated. Based on its 3-day chart, the TD sequential indicator gave a sell signal on Oct. 28 that now seems to have been validated. 

At the moment, XRP is being held by the 30-three-day moving average. Closing below this support level could ignite a sell-off that takes this cryptocurrency down to the next support levels that sit at $0.26, $0.25, and $0.24. 

XRP US dollar price chart
XRP/USD by TradingView

Nevertheless, 40-year trading veteran Peter Brandt recently stated that a diamond bottom pattern seems to be forming in XRP’s daily chart. Diamond bottoms are reversal patterns that are not common on traditional assets but are usually effective in the crypto market. Brandt estimates that if XRP is able to close above $0.30, it could shoot up more than 50 percent to $0.47.

Overall Sentiment

In the short-term perspective, the sentiment around the market is bearish. As Bitcoin moved below $9,000 without being able to finally break out of the consolidation phase it entered since four months ago, the odds for a pullback to $6,900 are growing. The same happens with Ethereum, which could retrace to $157 if the selling pressure behind it increases. And, XRP is showing signs of a move down to $0.24.

However, when looking at the market from a long-term perspective, everything looks bullish. Bitcoin is forming a bull flag that could lead to a 70 percent upswing to $16,500. Ethereum is developing a double bottom pattern targetting $223. And, XRP is in a diamond bottom pattern that could take it to $0.47, as Peter Brandt explained. 

Bitcoin | BTC

Updated: Nov 8 at 7:39 pm PDT
$8,847.48
-4.36%

Bitcoin, currently ranked #1 by market cap, is down 4.36% over the past 24 hours. BTC has a market cap of $159.57B with a 24 hour volume of $24.54B.

Chart by CryptoCompare

Bitcoin is down 4.36% over the past 24 hours.

Posted In: Price Watch, Technical Analysis

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Ali Martinez
Author

Ali Martinez

Technical Analyst @ CryptoSlate

After Ali began forex trading in 2012 In 2014, he came across Bitcoin’s whitepaper and was so fascinated by the idea of a decentralized, borderless, and censorship-resistant currency that he started buying Bitcoin. By 2015, he started traveling to spread the word about Bitcoin.

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