The cryptocurrency market is currently encountering turbulent conditions, which are putting the altcoin market to the test. Recent events, including legal actions by the U.S. Securities and Exchange Commission (SEC) against prominent crypto exchanges and upcoming inflation data and interest rate decisions by the United States Federal Reserve, are expected to have a significant impact on the cryptocurrency market.
Investors are advised to closely monitor the ongoing case between Ripple and the US Securities Regulatory Commission, as the release of the Hinman document on June 13th is expected to shed light on the classification of altcoins, particularly ethereum, as securities. This information will provide valuable insights for investors seeking to understand how various altcoins will be treated under regulatory frameworks.
The combination of a bearish market sentiment and prevailing uncertainty has dampened investor risk appetite, resulting in downward pressure on bitcoin and ethereum last week, although the selling pressure was less pronounced compared to other altcoins.
Bitcoin Struggles to Maintain Support Bitcoin has faced challenges in holding the $26,500 support level and ultimately lost it during a sharp drop over the weekend. The cryptocurrency fell to the second support level at $25,300 after breaking out of a symmetrical triangle formation.
At the $25,300 price level, buying interest has increased, indicating the emergence of a demand zone during the weekend decline. The ability to sustain the $25,300 level is critical for Bitcoin to avoid further declines. However, in the event of a renewed wave of selling, Bitcoin could drop to $24,000 and potentially even lower to $22,350.
On the daily chart, the exponential moving average (EMA) is poised for a bearish breakout, while the Stochastic RSI suggests a possible continuation of the decline into oversold territory. It is important to note that conditions in the cryptocurrency market can change rapidly, with strong buying pressure potentially reversing the negative sentiment. Furthermore, a recovery in the altcoin market would help dispel the prevailing negative sentiment across the market.
The key focus lies in whether Bitcoin can break through the $26,500 resistance level. Additionally, a daily close above $27,100 would fuel further upside momentum. Consequently, the breakthrough direction within the range of $25,300 to $26,500 may determine the next trend for Bitcoin.
Ethereum Faces Breakdown Ethereum prices recently completed a contracting triangle pattern and began to decline following news of the SEC’s legal actions against exchanges. In the first wave of the sell-off, Ethereum managed to hold the support level at $1,800 and remained above the 3-month exponential moving average (EMA).
During a subsequent sell-off over the weekend, Ethereum dropped below this crucial support point, reaching as low as $1,750. Currently, the closest support level for Ethereum stands at $1,750. If a downside breakout occurs, $1,660 may serve as the second support level. Should this level be breached, the next downside target for Ethereum would be $1,535.
In a bullish scenario, Ethereum needs to establish a stable bottom above $1,845 in the short term, while maintaining a daily closing price above $1,750. If these conditions are met, the next target area for Ethereum could be around $1,950.
In conclusion, the cryptocurrency market faces a challenging environment as altcoins are put to the test. Bitcoin’s ability to maintain key support levels and its breakthrough direction between $25,300 and $26,500 will be pivotal in determining its future trend. Similarly, Ethereum’s performance hinges on its ability to establish a stable bottom and hold above critical support levels. Investors are advised to closely monitor market developments and regulatory actions to navigate the current volatile
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