BTC developed several bull traps last weeks resulting in a downtrend and constant lower highs. We are now near a very important horizontal support level.
Looking at smaller timeframes we are bouncing now on this horizontal support and creating bull divergences on 12H(still to be confirmed), but traps are still in the market as we can see the price going up and down with a lot of volatility in the small-time frames.
This bounce coincides with the bounce of S&P500 on the MA20W which has been a support for the last year and a half.
That said, we still need a few days to see if that support will hold or will be broken, which would be very bearish for all markets.
On the bear side, we see how BTC is printing a Head and Shoulders pattern on the 1D chart, using the horizontal support as “neck” of the pattern. If the support does not hold and finally the bearish pattern is confirmed, the Blue Box and also next horizontal level would be the place to go during the next days/weeks.
ETH broke all the intermediate support levels, zooming out we can look at new levels. At this moment, we are in the main GP of the movement of July, so it is an important level to hold for ETH.
For instance, breaking down that level, should bring us to previous horizontal support, the blue box.
TOTAL MARKET CAP INDEX
Total market cap still in descending trend and also creating the Big Head And Shoulders Pattern. Levels remain the same as last market updates, with new horizontal support added in the chart.
ALTCOIN MARKET INDEX
Altcoins are in the same situation as TOTAL. Some altcoins are doing great last weeks, but the overall market is in the slow descending trend situation as BTC.
As said, BTC has been creating Bull traps during the last weeks. Selling pressure is winning to buying pressure, and we can see that we are not able to create new higher highs, resulting in a descending trend.
Everything is very oversold, but that does not mean that we can’t go lower.
In fact, if we think that most of the traders are looking at the big head and shoulders which is a very bearish pattern, we could say that we have more probabilities to go to lower levels rather than a reversal at the horizontal support.
However, we know that crypto tends to give us surprises, because of this it is important to stay zoomed out and look for validation of important support and resistance levels.