On the intra-day charts, bitcoin’s price momentum is fading, indicating that a break to the downside could happen at any time.
The price of Ethereum has become entangled with the 50-day simple moving average, which is a tactically significant figure (SMA).
The price of XRP moves aimlessly, forming a new channel along $0.65 with big technical impediments in the way.
After triggering a multi-month head-and-shoulders pattern, Bitcoin’s price has failed to deliver on hopes of a substantial rally. Meanwhile, the Ethereum price is showing signs of weariness and may be on the verge of a big drop. The price of XRP has remained steady, giving little indication of future direction.
The price of bitcoin fell by more than 40% in the second quarter, marking the lowest period since the fourth quarter of 2018. The significant loss will have ramifications beyond retail and institutional investors, including publicly traded corporations such as Tesla, which took a $1.5 billion Bitcoin position early this year.
Tesla made its first Bitcoin investment in February, when the cryptocurrency was selling in the $32,000-$33,000 region.
Tesla is expected to disclose in its quarterly report to investors that the impairment cost related with the Bitcoin holdings will range between $25 million and $100 million.
The impairment charge will occur owing to existing accounting rules, according to CNBC technology reporter Kate Rooney.
Tesla treats cryptocurrency as an intangible asset, and as a result of accounting laws, when Bitcoin’s value falls below a particular threshold, businesses must record a loss in their financial statements.
Furthermore, Tesla is unable to raise the price of Bitcoin until it sells the investment.
Despite the fact that the Bitcoin investment has lost money, Elon Musk has stated that the business has no intentions to sell the position in the near future.
Despite the construction of a weekly hammer candlestick pattern and the associated positive momentum divergence noted on the daily BTC Relative Strength Index, Bitcoin price has failed to create a compelling rally from the corrective bottom of $28,800 on June 22. (RSI).
The most recent leg higher in the Bitcoin price recovery has formed a rising wedge formation, with no impulsiveness or endurance, forming a new declining trend line that could prompt a BTC dip towards the psychologically significant $30,000.
The first sign that Bitcoin price is about to revisit the correction lows will be a close below the rising wedge’s bottom trend line and the 50 six-hour SMA around $34,308. The final confirmation will be a drop below $32,703.
With momentum weakening and the declining 50-day SMA at $36,000 pulling down on Bitcoin price, the odds suggest that the risk in the immediate term is to the negative.
6-hour chart of BTC/USD
A closing above the 200 six-hour SMA at $36,057 would negate the bearish prognosis and set the stage for a test of the rising wedge’s top trend line, which is now at $37,370. However, before BTC can reach the important resistance level of $42,500, it must first overcome severe barrier at the Anchored VWAP from October 21, 2020 at $37,724.
FXStreet’s analysts assess where BTC might go next, as it appears destined for a correction before greater highs.
From the June 22 low of $1,700, Ethereum pricing has formed a rising wedge pattern inside the context of a bigger declining triangle pattern that began on May 20. Because it slopes up against the prevailing ETH decline, the rising wedge is a continuation pattern in this situation. It predicts a downward price trend. As the smart contracts behemoth wrestles with the 200 six-hour SMA, those consequences may be on the horizon (similar to the 50-day SMA).
The most recent high did not meet the wedge’s upper trend line on the six-hour ETH chart below, suggesting a loss in momentum, and the current rally high has also fallen short of the higher trend line. The RSI, on the other hand, is showing a bearish momentum divergence with the Ethereum price.
If today’s high represents the end of the rally, the rising wedge pattern’s measured move is about 30%, implying a test of the June 22 low of $1,700.
A closure below the wedge’s lower trend line, which is now at $2,307, will indicate that the pattern is resolving to the downside, and a move below $2,160 will confirm it.
6-hour chart of ETH/USD
However, Ethereum price may continue to rise in a rising wedge formation, overcoming resistance from the 200 six-hour SMA at $2,377 and hitting the broader falling triangle’s upper trend line.
FXStreet’s analysts assess where ETH might go next, as it appears destined for a retracement before greater highs.
XRP has resolved to the downside from a rising wedge formation and found support at the union of the 50 six-hour SMA at $0.657 and the May 23 low of $0.652, after a promising 45 percent rally from the June low of $0.512.
The rising wedge pattern has a measured move of around 30%, or a price goal of $0.477. As a result, the price of XRP will break through the 78.6 percent retracement level at $0.555, as well as the June 22 low of $0.512. It would represent a 28% reduction from the current pricing.
A daily close below $0.632 will signal the start of a new leg lower, which could find temporary support near the 78.6% retracement. There are no clear Ripple support levels until $0.360 if the selling pressure persists past the June low of $0.512.
6-hour chart of XRP/USD
The price of XRP will not be actionable from the long side until it closes above $0.760 on a daily basis.
For the time being, the risk for the XRP price is to the downside.
FXStreet’s analysts assess where Ripple may be headed next, as it appears to be headed for a pullback./n
