Cryptos are now Sliding but may soon Bounce

On Sunday, Bitcoin, Ethereum, and Dogecoin were all down as investors worried about inflation, the possibility of rising interest rates, and the Ukraine/Russia situation. The cryptocurrency market, as well as the general markets, began to rebound between roughly Jan. 24 and Feb. 10, which was welcomed by bullish investors who had witnessed the Cryptos sector, in particular, undergo a long-term decline that began on Nov. 10. The upward reversal appears to have been nothing more than a relief bounce.

Bitcoin, Ethereum, and Dogecoin have all given up the majority of their 2022 gains as of Sunday. Assets never decline in a straight line in trading, just as they never rise in a straight line, and while the three Cryptos are now trading down, there are pivot areas on their charts where at least a bounce to the upside is likely to occur. Bitcoin’s Chart: On Sunday, Bitcoin was down about 5% on rather strong volume, indicating that the Friday break-down from a rising channel may have been spotted.

Bitcoin could drop to retest a falling trendline that it broke up through on February 3. In the future, the area could produce a pivot back to the upside. Bitcoin has resistance at $39,600 and $42,233.66 on the upside, and support at $38,105 and $35,993.22 on the downside. Bullish traders should keep an eye on Ethereum to see if it prints a reversal candlestick above the trendline, indicating that a bounce to the upside is imminent.

Bearish traders should keep an eye on Ethereum to see if it breaks below the trendline on higher-than-average volume, which might signal an accelerated move lower. Ethereum has resistance at $2,890 and $3,057.82 on the upside, and support at $2,609.02 and $2,461.63 on the downside.