Key concepts:
- Bitcoin (BTC) and ethereum (ETH) had lower sessions on Sunday as they ended the week in positive territory.
- Risk aversion sent BTC and ETH into the red on Sunday and through this morning’s session.
- News of protests over lockdown measures in China sent riskier assets into negative territory this morning.
Ethereum (ETH) fell 1.00% on Sunday. Reversing its 0.50% gain since Saturday, ETH ended the week up 4.67% at $1,193. Despite Sunday’s loss, ETH rebounded to $1,200 for the fourth session in a row.
A bullish morning saw ETH rise to an early high of $1,223. With the First Major Resistance Level (R1) reaching $1,228, ETH fell below $1,210 before consolidating. However, a late selloff saw ETH drop to $1,188 in the last hour. Finding support at $1,189 at the First Major Support Level, ETH ended the day at $1,193.
Bitcoin (BTC) fell 0.15% on Sunday. After a 0.36% loss on Saturday, BTC ended the day at $16,435. It should be noted that BTC avoided the price below $16,000 for the fifth day in a row, extending its losing streak to four sessions.
A bullish start to the day saw BTC rally to an early high of $16,603. After reaching the First Major Resistance Level (R1) at $16,642, BTC fell to $16,410. However, breaking out of the First Major Support Level (S1) at $16,334, BTC found late support to end the day at $16,435.
The end of the Thanksgiving holiday in the US left trading volume on the downside. While investor sentiment on FTX contagion continued to improve, there was risk aversion in the final hour of the Sunday session (UTC) and in global financial markets this morning.
News of protests in China sent riskier assets into negative territory and overshadowed investors’ optimism that the risk of FTX contagion was low.
Later today, FTX news updates and the NASDAQ Composite Index will guide the afternoon session. At the time of writing, the NASDAQ mini was down 90.25 points.
Ethereum (ETH) Price Action
At the time of writing, ETH is down 1.93% to $1,170. The day’s bearish start saw ETH fall from an initial high of $1,199 to $1,158.
ETH dropped from the First Major Support Level (S1) at $1,180 and briefly from the Second Major Support Level (S2) at $1,166.
Technical indicators
ETH should break the First Major Resistance Level (R1) at $1,215 via S1 and the $1,201 pivot and $1,223 on Sunday. A return of ETH to $1,200 would signal a bullish afternoon session. However, the NASDAQ Index and cryptocurrency news should provide support.
In the case of an extended rally, ETH is likely to test the Second Major Resistance Level (R2) at $1,236. The Third Key Resistance Level (R3) at $1,271.
Failure to move through S1 and the pivot will leave the Second Key Support Level (S2) at $1,166. However, barring an extended sell-off in the afternoon, ETH should avoid the third Key Support Level below $1,150 and $1,131.
News of more crypto platforms stopping the pullback will bring a return below $1,100.
Looking at the EMAs and the 4-hour candlestick chart (below), this was a bearish signal. Ethereum sat below its 50-day EMA, currently at $1,194. The 50-day EMA fell back from the 100-day EMA, while the 100-day EMA pulled back from the 200-day EMA, giving bearish signals.
A move through S1 ($1,180) and the 50-day EMA ($1,194) would support a run through R1 ($1,215) and the 100-day EMA ($1,226). However, a failure to move through the 50-day EMA ($1,194) will put ETH under pressure.
Bitcoin (BTC) Price Action
At the time of writing, BTC is down 1.45% to $16,197. The bearish start to the day saw BTC fall from an initial peak of $16,487 to $16,052. BTC broke below the day’s Key Support Levels before retreating to the Third Key Support Level (S3) at $16,097.
Technical indicators
BTC needs to break through the S2, S1 and $16,483 pivot to reach the First Major Resistance Level (R1) at $16,555 and $16,603 on Sunday. A return to $16,500 would signal a bullish session. However, BTC will need friendly news updates related to NASDAQ Composite Index and FTX.
In the case of an extended rally, BTC is likely to test the Second Major Resistance Level (R2) at $16,676. The Third Key Resistance Level (R3) is $16,869.
Failure to move through S2, S1 and the pivot will release the Third Key Support Level (S3) at $16,097. Barring an extended selloff, BTC should not fall below $16,000.
However, negative FTX-related news or extended risk-off selling will bring the sub-$16,000 level into play.
Looking at the EMAs and the 4-hour candlestick chart (below), this was a bearish signal. This morning, bitcoin sat below its 50-day EMA, currently at $16,504. The 50-day EMA slipped back from the 100-day EMA, the 100-day EMA fell back from the 200-day EMA, giving bearish signals.
A breakout of BTC’s Key Support Levels and 50-day EMA ($16,504) will trigger R1 ($16,555). However, failure to break above the 50-day EMA ($16,504) will put BTC under pressure.