Now that the Federal Reserve’s rate decision is out of the way, it’s a great time to take a deeper look at some of the leading cryptocurrencies. As a follow-up to last week’s article, this piece will be going over the cryptocurrencies to watch this week: Bitcoin (BTC-USD), Ethereum (ETH-USD), and Ripple (XRP-USD).
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Bitcoin
Despite the U.S. stock market continuing its crash this week, Bitcoin held relatively strong. The largest cryptocurrency was just a touch away from the major key level of $20,000. However, then came the rate hike, and Bitcoin collapsed 10% in just a few hours, all the way to a low of $18,150. From there, buyers came back into the markets, buying the dip and pushing the price back above $19,000.
As of now, there are two critical levels to watch for in the charts. The first is the $18,250 support level, which is the area on the chart where buyers are stronger. This area of support has been holding strong since the yearly low printed on June 18.
The second key level is the resistance at around $20,000, which is the area on the charts where the sellers are stronger. Once Bitcoin breaks outside of this range, traders should be looking to make a move in the direction of the break.
Ethereum
Ethereum is down significantly since the long-awaited merge finally went live. In a similar move to Bitcoin, Ethereum was looking strong and on its way to breaking above a key resistance level at $1,400 just minutes before the Fed’s announcement. Then, following the broader equity and crypto markets, Ethereum came crashing down by more than 12% in a few hours. This continued the negative momentum seen in Ethereum since the merge.
Looking at the chart, we can see that the “head and shoulders” pattern mentioned a few weeks ago did form.
Ethereum broke below the major support level at $1,400. From here, if the bearish momentum continues, the price can go all the way back down to the next major support area at around $1,000. However, if the coming week starts with strong buying, and the price breaks and closes above $1,400, then a new bullish wave can push the price up to the next resistance area at around $1,700.
Ripple
As mentioned in last week’s article about the Ripple Lawsuit, a lot of good things have been happening lately over at Ripple Labs. At the time of writing, XRP has been the number one performing token recently, as it is up more than 30% in the last 7 days.
Fueled by the latest developments, XRP went on a strong rally from the major support area of $0.32 to the key resistance level of $0.55. As of now, XRP is trading just below the $0.50 level. In case this bullish momentum continues, or good news comes out from the ongoing legal battle, XRP can break above this resistance area and climb all the way up to the critical level of around $0.75. However, if the sellers regain control, they can push the price back down to the previous support at around $0.40.
Conclusion: Patience is Key
Historically, September is considered to be the worst month in the financial markets. Now that the Fed’s rate decision is out of the way and September is about to finish, markets can breathe a bit and show us a clearer move forward. I’ll definitely be staying patient this week, only buying or selling from the levels mentioned above.
Also, traders are advised to keep a close eye on the U.S. stock market. If the leading U.S. indices break into a new low, then so will Bitcoin. However, if the equity buyers come in strong this week, then traders can expect the same bullish behavior in cryptocurrencies.
