Bitcoin, BTC/USD, Ethereum, ETH/USD – Outlook:
- Bitcoin and Ethereum failed to hold last week’s early gains.
- ETH/USD and BTC/USD continue to flirt with major support levels.
- What is the outlook and what are the key levels to watch?
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BITCOIN: Not out of the woods yet
Last week’s early bounce was short-lived after the Securities and Exchange Commission (SEC) delayed making any decision on Bitcoin ETF applications. While many remain hopeful of an eventual blessing from the agency, the optimism isn’t being reflected on the technical charts of BTC/USD just yet.
BTC/USD Weekly Chart
Chart Created by Manish Jaradi Using TradingView
BTC/USD is now testing key support at the June low of 24750 – this support is crucial as a break below would disrupt the higher-highs-higher-lows sequence since late 2022. Furthermore, such a break would trigger a double top (the April and July highs), pointing to a deeper retracement toward the March low of 19550.
BTC/USD Daily Chart
Chart Created by Manish Jaradi Using TradingView
The recent weakness follows an inability to rise past the upper edge of the Ichimoku cloud on the weekly charts, roughly coinciding with a slightly upward-sloping trendline from 2021 and the 89-week moving average. For more discussion, see “Bitcoin & Ethereum Hold Ground Ahead of US CPI: BTC/USD & ETH/USD Price Setups,”published August 10.
ETH/USD Weekly Chart
Chart Created by Manish Jaradi Using TradingView
ETHEREUM: Looking vulnerable
Ethereum appears to be struggling to hold above a vital floor at the June low of 1620. This support is crucial for the broader recovery from the end of 2022 to continue. Any break below would confirm that the bullish bias had dissipated. Such a fall would initially open the way toward the March low of 1370, with major support at the 2022 low of 880.
ETH/USD Daily Chart
Chart Created by Manish Jaradi Using TradingView
Like Bitcoin, ETH/USD has been under the influence of the bearish Ichimoku cloud cover on the weekly charts. In recent months, Ethereum hasn’t been able to clear past the upper edge of the cloud on the weekly charts, roughly coinciding with a slightly upward sloping trendline from 2021. ETH/USD’s inability to rise toward the top of the cloud cover, in comparison with BTC/USD, reflects its relative weakness. For more discussion, see “Is the Rally Over in Bitcoin & Ethereum? BTC/USD & ETH/USD Price Setups,” published August 23.
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— Written by Manish Jaradi, Strategist for DailyFX.com
— Contact and follow Jaradi on Twitter: @JaradiManish
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