- Bitcoin price looks set for a downturn as it approaches its key resistance level of around $62,000.
- Ethereum price risks falling after facing a major resistance level near $2,843.
- Ripple price finds stability around the daily support level of $0.544, with potential recovery on the cards.
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Bitcoin (BTC) and Ethereum (ETH) prices are likely to decline as they near their key resistance levels, whereas Ripple (XRP) is showing stability around the daily support level of $0.544, indicating the potential for a recovery.
Bitcoin price is poised for rejection after retesting key resistance level
Bitcoin price has consistently faced resistance at the 61.8% Fibonacci retracement level of $62,066, drawn from the swing high of $70,079 on July 29 to the low of $49,101 on August 5. As of Wednesday, it is trading up by 0.1% at $60,642.
If the 61.8% Fibonacci retracement level at $62,066 continues to act as resistance, in conjunction with the broken trendline and the 100-day Exponential Moving Average at around $62,649, selling pressure could increase.
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A failure to break above $62,066 might result in an almost 20% decline, potentially testing the daily support level of $49,917.
On the daily chart, the Relative Strength Index (RSI) and Awesome Oscillator (AO) trade below their neutral levels of 50 and zero, respectively, suggesting an impending bearish trend.
BTC/USDT daily chart
However, if Bitcoin closes above the August 2 high of $65,596, it would set a higher high on the daily chart, possibly leading to a 6% price increase and testing the weekly resistance at $69,648.
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Ethereum price is set for a decline after retesting its key resistance levelÂ
Ethereum price is retesting its 50% retracement level of $2,843 (drawn from the swing high of $3,562 on July 22 and the swing low of $2,124 on August 5). This level coincides closely with the daily resistance at $2,927, making it a key resistance zone. As of Wednesday, it trades slightly higher by 0.2% at $2,704.
If Ethereum’s price does not break above $2,843, it may fall by 25% to test its weekly support level at $2,118.
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This bearish outlook is reinforced by the daily RSI and AO, which have dropped below their neutral levels of 50 and zero, indicating a prevailing bearish trend.
ETH/USDT daily chart
On the other hand, if Ethereum’s price closes above the July 29 high of $3,396, it will establish a higher high on the daily chart, potentially driving a 5% increase to revisit the July 22 high of $3,562.
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Ripple price shows potential for a rally after finding support around the daily level
Ripple faced rejection at the daily resistance level of $0.643 on August 8, leading to a 10.35% drop over the next three days. However, on Monday, it found support at around $0.544, which led to a 1.5% recovery the following day. As of Wednesday, Ripple is trading slightly higher at $0.578, up 0.45%.
If the daily support at $0.544 holds, XRP could rally 10% to challenge the next resistance level at $0.643.
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The daily chart’s RSI has moved above its neutral level of 50, and AO is on its way to doing the same. The bullish trend will be reinforced if both momentum indicators trade above their neutral levels.
XRP/USDT daily chart
Conversely, if Ripple’s price closes below the $0.544 daily support level, it would shift the market structure by creating a lower low on the daily chart, potentially leading to a 9.5% decline to revisit the August 7 low of $0.492.
Cryptocurrency metrics FAQs
The developer or creator of each cryptocurrency decides on the total number of tokens that can be minted or issued. Only a certain number of these assets can be minted by mining, staking or other mechanisms. This is defined by the algorithm of the underlying blockchain technology. Since its inception, a total of 19,445,656 BTCs have been mined, which is the circulating supply of Bitcoin. On the other hand, circulating supply can also be decreased via actions such as burning tokens, or mistakenly sending assets to addresses of other incompatible blockchains.
Market capitalization is the result of multiplying the circulating supply of a certain asset by the asset’s current market value. For Bitcoin, the market capitalization at the beginning of August 2023 is above $570 billion, which is the result of the more than 19 million BTC in circulation multiplied by the Bitcoin price around $29,600.
Trading volume refers to the total number of tokens for a specific asset that has been transacted or exchanged between buyers and sellers within set trading hours, for example, 24 hours. It is used to gauge market sentiment, this metric combines all volumes on centralized exchanges and decentralized exchanges. Increasing trading volume often denotes the demand for a certain asset as more people are buying and selling the cryptocurrency.
Funding rates are a concept designed to encourage traders to take positions and ensure perpetual contract prices match spot markets. It defines a mechanism by exchanges to ensure that future prices and index prices periodic payments regularly converge. When the funding rate is positive, the price of the perpetual contract is higher than the mark price. This means traders who are bullish and have opened long positions pay traders who are in short positions. On the other hand, a negative funding rate means perpetual prices are below the mark price, and hence traders with short positions pay traders who have opened long positions.
