The top three altcoins in the cryptocurrency market appear to have entered a period of low volatility signaling that a major price movement could be underway.
- Ethereum continues consolidating between $210 and $198 without clear signs of where it is headed next.
- XRP is also sitting in a no-trade zone defined by the $0.19 support and the $0.20 resistance level.
- Meanwhile, Litecoin awaits for dominant market forces to take control of its price action.
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Many cryptocurrencies on the market are showing signs of indecision, and investors are waiting on the sidelines for Ethereum, XRP, or Litecoin to finally breakout.
Ethereum, XRP, and Litecoin Remain Stagnant
Market participants alike are growing impatient about the future of the cryptocurrency market.
Last Friday, crypto Twitter was flooded with bearish views after $30 billion were wiped from the market. Today, the overall outlook appears to have turned bullish following the price action seen over the past few hours.
For this reason, Crypto Briefing has been paying close attention to Ethereum, XRP, and Litecoin to determine the direction of the trend. These three altcoins are, however, still contained within narrow trading ranges and have yet to provide a clear sign of where they are headed next.
Ethereum, for instance, has been mostly trading between $210 and $198 in the last week. Although its price seems trapped in an ascending parallel channel since March’s Black Thursday, it is not clear whether it will continue to behave as it did over the last three months.
If the same price action were to continue, it is reasonable to expect a bullish impulse that sends Ether above the overhead resistance. The upswing could be meaningful enough for a full-blown rebound to the middle or upper boundary of the channel.
Nonetheless, a spike in sell orders behind the smart contracts giant might jeopardize the bullish outlook.
If this were to happen, the most significant areas of support to watch out for are the $198 barrier, the lower boundary of the ascending parallel channel, the 23.6% Fibonacci retracement level, and the 100-day moving average.
A daily candlestick close below this support cluster could be catastrophic as it may trigger a sell-off pushing Ether down to $158 or lower.
Like Ethereum, Ripple’s XRP also entered a stagnation phase, but for a more extended period. The cross-border remittances token has been trading within the 23.6% and 38.2% Fibonacci retracement levels since May 11.
The length of this consolidation period indicates that momentum for an explosive breakout has been building up slowly. However, the inability to determine the direction of the trend makes the area between these Fibonacci retracement levels a no-trade zone.
A candlestick close above resistance may see XRP jump towards the 200-day exponential moving average that is hovering around $0.223. Conversely, moving past support could see the price of this cryptocurrency plummet to $0.17 or $0.16.
Along the same lines, the 23.6% and 38.2% Fibonacci retracement levels are critical to Litecoin’s trend. Trading within this area poses considerable risk since it is unknown whether bulls or bears will take control of LTC’s price action.
If a clear break to the upside comes first, the next essential resistance walls sit around the 100-day moving average and late April’s high of $51.
But if the bears jump in to flush out weak hands, Litecoin may drop to $38 or $35.
Understanding the importance of the support and resistance levels mentioned above could allow anyone to minimize risk while profiting from the next significant price movement of any of these altcoins.
A good dose of patience, however, is a must since the ongoing consolidation phase may prolong.