The crypto markets are selling off in the wake of the U.S. CFTC filing suit against Binance. Technical traders are worried there could be more downside coming.
In a recent episode of The Crypto World channel, host Josh analyzed the current market conditions for both ethereum (ETH) and bitcoin (BTC), highlighting bearish divergence and resistance challenges.
Here’s a breakdown of the key points from his analysis.
Josh reported that ethereum is experiencing a bearish divergence, breaking below its short-term support. He encouraged his audience to stay tuned for further analysis on this trend. Ethereum is currently facing rejection from a resistance range of $1,770 to $1,820.
If the price continues to decline, support between $1,650 to $1,700 is expected to hold. A break below the short-term support level of $1,730 would signal a bearish turn, leading to further pullback.
Bitcoin, on the other hand, is facing rejection from a resistance range of $28,000 to $29,500, indicating a short-term pause or setback from its bullish trend. If the price experiences a further pullback, the support area between $24,000 to $25,200 is expected to provide significant support for the cryptocurrency.
You might also like: Crypto markets react to Binance’s battle with CFTC
The bearish divergence is also evident on the bitcoin-to-euro dollar chart, as lower highs are consistently forming in the short term. This is a sign of weakness in the cryptocurrency, which may lead to further declines in the near future.
Josh also noted that the funding rates for all coins across all exchanges are flipping into the negative territory. This negative shift in funding rates encourages traders to short bitcoin. The development indicates a potential change in market sentiment, as traders position themselves for the possibility of a downward price movement.
As ethereum and bitcoin face resistance and bearish divergences, the host thinks more downside is possible. For ethereum, the support ranges between $1,650 and $1,700, which is a critical level to monitor.
If ethereum breaks below its short-term support of $1,730, it would signal a bearish trend and could result in further declines. For bitcoin, investors should watch the support area between $24,000 to $25,200. If the cryptocurrency falls below this range, it could face additional selling pressure and continue its downward trend.
Josh’s analysis on The Crypto World channel serves as a reminder that the cryptocurrency market can experience fluctuations and setbacks, even during a bullish trend.
Both ethereum and bitcoin are currently facing resistance and bearish divergences, which could result in short-term declines. The remarks follow today’s report that crypto analyst The Crypto Lark sees the Wyckoff schematic as a valuable analytical tool, and shares his views on the bitcoin market in a recent YouTube video.
Read more: Binance’s CZ responds to ‘unexpected’ CFTC accusations