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Bitcoin and Ethereum Steady After Early-Week Swings
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Bitcoin, Ethereum and XRP saw some volatile price movements, with plenty of sideways action and some stop hunts thrown into the mix.
Bitcoin waves hello
Last week saw Bitcoin (BTC) move 10% up to 3,985 USD.
This week BTC consolidated between 3,850-3,950 USD before another upward move up to 4,185 USD.
Unfortunately, BTC was unable to find adequate support in this price range, subsequently falling back to 3,715 USD and into another consolidation pattern between 3,715-3,830 USD.
Zooming out to the 4-hour chart, we can see BTC’s recent price action conforms to key Fibonacci levels.
After hitting its local high at about 4,185 USD, BTC retraced to the 0.5 Fibonacci level and is currently range-trading between between the 0.5 and 0.382 Fibonacci levels.
For traders who use Elliott Wave analysis, it’s unclear if the recent move up to 4,185 USD was Wave 3 or Wave 5.
Traditionally, the Wave 2 and Wave 4 corrections are opposite in nature.
Wave 2 in this particular market structure was fairly gradual, so it’s possible that the recent drop from USD4,185 to USD3,665 was a Wave 4 correction.
If that’s the case, we may see another move up for Wave 5.
As a follow-up to our recent post about stop hunts, we can see another example in the 4-hour chart.
After BTC bounced off the 0.5 level, it’s probable to assume many traders used this local low as a stop loss level for a long position.
The stop hunt can be seen 20 candles later on the long wick down to 3,665 USD, which corresponds to the 0.618 Fibonacci level almost perfectly.
Over the past few weeks, we’ve kept a close eye on this red trendline on the BTC/USD daily chart.
BTC has found a temporary support above the red trendline, but hasn’t tested it yet.
While the current daily candle is still forming, the previous two doji candlesticks signaled indecision in both bullish and bearish directions.
Looking on the daily chart, the argument that BTC is currently gearing up for a Wave 5 move upward is even stronger.
Ethereum gets forked
After a 60% move up to 170 USD over the past two weeks, Ethereum (ETH) fell 24% down to 125.70 USD.
ETH’s extended dump compared to BTC and XRP may be attributed to its recent speculative price appreciation around the Constantinople and St. Petersberg hard forks.
Following the successful hard forks on February 28, the price of ETH did not immediately respond.
On the 4-hour chart, ETH looks strikingly similar to BTC.
After hitting 170 USD, ETH retraced down to the 0.5 Fibonacci level at 133 USD.
Like BTC, ETH also saw a stop hunt down to the 0.618 Fibonacci level at USD125.38.
XRP has been doing its own thing as of late – and this past week was no exception.
Similar to BTC and ETH, XRP experienced a major sell-off on February 24.
However, this sell-off was quickly followed by a 15% move back to the upside.
After the 15% move up to 0.33197 USD, XRP retraced nearly 100% of the gains and fell back to USD0.298 before rebounding to the upside.
In the short term, BTC and ETH look primed for a Wave 5 to the upside, while XRP looks a little more uncertain.
Over the next few weeks, it’ll be interesting to see if BTC can continue finding support above the red trendline we highlighted on the BTC/USD daily chart.