Bitcoin & Ethereum Week Ahead: Upside Capped For Now?

Bitcoin, BTC/USD, Ethereum, ETH/USD – Technical Outlook:

Bitcoin and Ethereum have broken above minor resistance.
Still, the early-May highs would be tough hurdles to clear.
What are the key levels to watch?

Recommended by Manish Jaradi

Get Your Free Introduction To Cryptocurrency Trading

Developments on higher timeframe charts suggest the recent rebound is not a sign of the resumption of the multi-week uptrend. Indeed, chances are that cryptocurrencies could be settling in a range in the interim.

BTC/USD Daily Chart

Chart Created by Manish Jaradi Using TradingView

BITCOIN: Consolidation within the uptrend

BTC/USD has managed to hold above quite strong converged support around 25300-26000 (including the 89-day moving average and the February 2023 high), highlighted in the previous update. See “Bitcoin & Ethereum Week Ahead: Cracks in the Rally?”, published May 15. The rise on Monday above the initial cap at the mid-May high of 27675 has reduced the downward pressure somewhat. However, unless BTC/USD clears the 30000 mark, the path of least resistance is sideways to slightly down.

BTC/USD Daily Chart

Chart Created by Manish Jaradi Using TradingView; Refer to notes at the bottom

As highlighted in the previous update, the broader trend in BTC/USD remains bullish, notwithstanding the recent consolidation, as the colour-coded candlestick charts based on trending/momentum indicators show (first highlighted in January – see “Bitcoin Technical Outlook: BTC/USD Turns Bullish”, published January 18). Subsequently, the early May update outlined the prospects of some softness in cryptocurrencies. See “Bitcoin & Ethereum Price Action: Is the Rally Over?” published May 8.

ETH/USD Daily Chart

Chart Created by Manish Jaradi Using TradingView

ETHEREUM: An extended consolidation?

ETH/USD has crossed above the immediate hurdle at last week’s high of 1872, suggesting that the downward pressure has eased a bit. However, ETH/USD needs to break above the May 6 high of 2019 for the downside risks to be eliminated.

ETH/USD Monthly Chart

Chart Created by Manish Jaradi Using TradingView; Refer to notes at the bottom

ETH/USD has so far held above crucial cushion at the February highs of 1710-1740 (including the 89-day moving average) amid a broader bullish outlook. However, ETH/USD’s fall earlier this month below horizontal trendline support at 1780 could be the start of a broader consolidation/sideway range. Moreover, on the monthly charts, ETH made a lower low this month compared with the April low, suggesting a soft bias.

Note: In the above colour-coded candlestick charts, Blue candles represent a Bullish phase. Red candles represent a Bearish phase. Grey candles serve as Consolidation phases (within a Bullish or a Bearish phase), but sometimes they tend to form at the end of a trend. Note: Candle colors are not predictive – they merely state what the current trend is. Indeed, the candle color can change in the next bar. False patterns can occur around the 200-period moving average, or around a support/resistance and/or in sideways/choppy market. The author does not guarantee the accuracy of the information. Past performance is not indicative of future performance. Users of the information do so at their own risk.