- Bitcoin price hovers around $82,700 on Wednesday after recovering 5.52% the previous day.
- Ethereum price hovers around its weekly support of $1,900; a firm close below would suggest a further correction.
- XRP finds support around its daily level of $1.96, indicating a recovery on the cards.
Bitcoin (BTC) price hovers around $82,700 on Wednesday after recovering 5.52% the previous day. Ethereum (ETH) price shows weakness while Ripple (XRP) price shows signs of recovery as these coins expect volatility around the US Consumer Price Index (CPI) data release on Wednesday.
Bitcoin hints at recovery as its RSI indicator bounces off oversold conditions
Bitcoin price broke below its 200-day EMA at $85,664 on Sunday and declined 9.14% until the next day. However, BTC retested, found support around the $78,258 level, and recovered 5.52% on Tuesday. At the time of writing on Wednesday, it hovers at around $82,700.
If BTC continues to correct and closes below $78,258 (February 28 low), it could extend the decline to retest its next support level at $73,072.
The Relative Strength Index (RSI) on the daily chart reads 40, pointing upwards after bouncing off from 30 on Monday, indicating fading bearish momentum and a potential shift from oversold conditions. However, the RSI must move above its neutral level of 50 for the recovery rally to be sustained.
BTC/USDT daily chart
If bullish momentum mounts, BTC could extend the recovery to $85,000.
Ethereum price momentum indicator displays weakness
Ethereum price declined 7.69% on Monday; however, it recovered 3.13% the next day and closed above the weekly support level at $1,905. At the time of writing on Wednesday, it hovers around the weekly level of $1,905.
If ETH continues to decline and closes below the $1,905 level, it could extend the correction to retest its next support level at $1,700.
The RSI on the daily chart reads 32, pointing downwards to its oversold level of 30, indicating strong bearish momentum.
ETH/USDT daily chart
On the other hand, if ETH recovers, it could extend the recovery to test its next daily resistance at $2,359.
Ripple could recover if its $1.96 level continues to hold as support
Ripple price retested its daily support of $1.96 on Tuesday, and it recovered 7.40%. At the time of writing on Wednesday, it continues to recover, trading at around $2.20.
If XRP continues to recover, it could extend the recovery to test its next resistance level at $2.72.
The RSI on the daily chart reads 44 and points upwards toward its neutral level of 50, indicating fading bearish momentum. However, the RSI must move above its neutral level of 50 for the recovery rally to be sustained.
XRP/USDT daily chart
However, if XRP faces a correction and closes below $1.96 daily support, it could extend an additional decline to test its February 3 low of $1.77.
Bitcoin, altcoins, stablecoins FAQs
Bitcoin is the largest cryptocurrency by market capitalization, a virtual currency designed to serve as money. This form of payment cannot be controlled by any one person, group, or entity, which eliminates the need for third-party participation during financial transactions.
Altcoins are any cryptocurrency apart from Bitcoin, but some also regard Ethereum as a non-altcoin because it is from these two cryptocurrencies that forking happens. If this is true, then Litecoin is the first altcoin, forked from the Bitcoin protocol and, therefore, an “improved” version of it.
Stablecoins are cryptocurrencies designed to have a stable price, with their value backed by a reserve of the asset it represents. To achieve this, the value of any one stablecoin is pegged to a commodity or financial instrument, such as the US Dollar (USD), with its supply regulated by an algorithm or demand. The main goal of stablecoins is to provide an on/off-ramp for investors willing to trade and invest in cryptocurrencies. Stablecoins also allow investors to store value since cryptocurrencies, in general, are subject to volatility.
Bitcoin dominance is the ratio of Bitcoin’s market capitalization to the total market capitalization of all cryptocurrencies combined. It provides a clear picture of Bitcoin’s interest among investors. A high BTC dominance typically happens before and during a bull run, in which investors resort to investing in relatively stable and high market capitalization cryptocurrency like Bitcoin. A drop in BTC dominance usually means that investors are moving their capital and/or profits to altcoins in a quest for higher returns, which usually triggers an explosion of altcoin rallies.
