The central theses
- Bitcoin and Ethereum stagnated and showed no signs of the direction of their trends.
- As the Bollinger Bands on the daily chart compress, a period of high volatility appears to be imminent.
- The Fibonacci retracement indicator shows what BTC and ETH need to do to resume their respective uptrends.
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The top two cryptocurrencies by market capitalization, Bitcoin and Ethereum, continue to consolidate while other cryptocurrencies with lower market capitalizations rebound. Although interest is shifting, several metrics show that BTC and ETH are prepared for a big price move.
Bitcoin and Ethereum ready for volatility
Bitcoin and Ethereum stagnated with no clear indication of where to go next.
Meanwhile, lower capitalization cryptocurrencies like Solana, Terra, and Avalanche have skyrocketed. Many crypto assets have entered pricing mode as they hit new all-time highs. This remarkable price action has a feeling of “greed“Among investors, which leads some suggest that a new “old season” has started.
Behavioral analysis platform Santiment recorded one of the highest levels of pessimism about Bitcoin and Ethereum as lower cap assets steal the limelight. Such negative social sentiment is a direct result of lackluster price developments recently. Still, the poor social perception could provide a good opportunity for traders to place a value bet on BTC and ETH.
With Bitcoin and Ethereum consolidating in a tight range, traders need to be patient so as not to get stuck on the wrong side of the trend. Waiting for a prime entry opportunity is especially important now as both assets appear to be on the cusp of significant price movement.
Bitcoin’s daily chart shows that a candlestick close outside of the $ 51,000 to $ 47,000 price range would likely determine where the journey is headed next.
A surge in buy orders pushing BTC past the overhead resistance could push it up towards $ 57,000 or even an all-time high of $ 65,000. On the flip side, losing the $ 47,000 in support could result in a sell-off that pushes the leading cryptocurrency to $ 42,500, or $ 37,300.
Ethereum has also shown ambiguity, but the contraction of the Bollinger Bands suggests a spike in volatility is underway.
A critical move above the $ 3,360 resistance level could be all it takes for ETH to move to $ 3,750 or retest previous all-time highs. However, if sell orders pile up, ETH could break the $ 3,000 support level and fall towards $ 2,700 or $ 2,300.
While cryptocurrency enthusiasts wait for Bitcoin and Ethereum to break resistance or support, some of the industry’s most prominent figures remain optimistic. On-chain analyst Will Clemente entertains that the “strongest on-chain accumulation in the history of Bitcoin” is currently taking place. Also the economist Efe Bulduk believes that Ethereum is prepared for a supply shock as its supply on the exchanges “melts like an athlete running a marathon on a hot summer day”.
Now it seems like only a matter of time before Bitcoin and Ethereum take a big step.
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