After significant price increases took place last week across all top cryptocurrencies, a reversal has been taking place this week.
Whether this reversal is bullish or bearish for future price prospects is unclear with there being a case to be made for both a bullish scenario and a bearish scenario.
There is evidence that the price increase last week was driven by a large buyer in Bitcoin making several executed trades of greater than 100 Bitcoin.
If this is the case, the buying pressure that drove price may now be absent and a reversal, in this case, would make sense.
On the other hand, the reversal may simply be the price undergoing a brief correction after its increase and serve to form a higher low.
A higher low formed would result in a bullish market structure and may be followed up with another significant increase.
In the case of Cardano, the price has dropped to an important support level at $0.08.
This was an important support level recently after Cardano launched and also acted as resistance once the price had dropped below.
The drop to $0.08 took place after Cardano formed a recent high of around $0.1.
Price failed to maintain valuations above $0.1 and quickly dropped below marking it as a significant resistance level.
$0.1 is also likely coming into play as an important psychological point given it being a round psychological level for Cardano.
South Korean launched project ICX has also been undergoing a reversal.
The price managed to form a higher high last week while the RSI value failed to rise above its last high.
This can be interpreted as a reversal signal with price forming a higher high but buying pressure failing to rise above previous levels.
Last week, the price of ICX managed the rise above the level where the price broke down in November.
However, the reversals being seen this week have brought the price back below, and it has since continued to drop below a previous high at $0.38 which was anticipated to provide some support.
The price has dropped to the upper boundry of a range area where price spent the majority of mid-March to mid-April trading within.
The upper bound of the range at $0.35 has so far provided support despite a number of tests.
However, repeated tests serve to make the level weaker with fewer buyers to hold the support level on each test.
If the price breaks below, the next level to monitor is the lower bound of the range at $0.32 which would be expected to provide some support.
- Cryptocurrencies are undergoing a reversal this week after the price rises of last week.
- Both Cardano and Icon are dropping, but Cardano has managed to maintain above a support level at $0.8.
- Icon has dropped to the upper bound of a former range at $0.35. If the price drops below this point, the next key level to monitor is $0.32.
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