Panic sellers likely to regret soon
- Bitcoin price has dipped into the weekly FVG, indicating that a short-term bottom might be near.
- Ethereum price approaches a reversal level after a 17% crash in four weeks.
- Ripple price is also waiting on BTC’s consent for a rebound rally.
Bitcoin (BTC) price shows a lack of buying participants after crashing nearly 17% over four weeks. Due to the dearth of bullish momentum, there seems to be no recovery rally in sight. However, there seems to be a slow yet steady plan for a bounce, which if confirmed, could trigger a mini-rally for altcoins, including Ethereum (ETH) and Ripple (XRP) as well.
Bitcoin price is close to initiating a recovery
Bitcoin (BTC) price entered the weekly Bearish Breaker, extending from $29,247 to $41,273, which triggered a spike in selling pressure. As a result, BTC slid 16.50% between April 10 and May 8 into the weekly Fair Value Gap (FVG), which extends from $22,591 to $26,591.
For more details on Breakers and FVG, read this: Where will the 2023 crypto bull rally top? – ICT
While the bullish outlook for Bitcoin price has not become apparent yet, there are signs that traders can look for to spot an early trend reversal. The Relative Strength Index (RSI) could slide a little lower to bounce off the mean level. The Awesome Oscillator (AO) shows a decline in bullish momentum but is very close to seeing a reset at the zero-line.
With this momentum reset in mind, investors should pay attention to the $25,205 and $24,300 support levels to accumulate BTC. A clear outlook in momentum shift can be observed on the daily chart. In the likely case that buyers make a comeback, Bitcoin price will eye a retest of the bearish breaker’s midpoint at $35,260.
In total, this move would constitute a 40% to 45% gain for investors based on their accumulation levels.
BTC/USD 1-week chart
Investors should note that the bullish outlook detailed above needs to be spotted and then confirmed. However, if neither of the above is noted, Bitcoin price could continue to plummet. In such a case, BTC might find support at $17,605, which is the selling climax of the June 13 weekly candlestick.
Ethereum price recovery awaits BTC’s signal
Ethereum (ETH) price set up a prolonged bearish divergence sell signal on the daily chart between January 14 to May 13. This setup resulted in a 17% crash in four weeks that pushed ETH to $1,735.
Although Ethereum price failed to retest the $1,705 support level, it slipped below the $1,817 structure. While a recovery seems to be already in place, investors need to wait for Bitcoin to show its hand before jumping on altcoins like ETH.
Investors can look at the $1,705 support level for accumulation, but in a dire case, a dip into the daily FVG, extending from $1,478 to $1,563, seems plausible. If Bitcoin price kick-starts its recovery, Ethereum price might also eye a recovery rally and a retest of $2,028.
ETH/USD 1-day chart
A daily candlestick close below $1,478 will invalidate the FVG and the bullish thesis for Ethereum price. In such a case, ETH could slide down to $1,249.
Ripple price fails again
Ripple price has been trying to overcome the $0.532 resistance level for nearly a year. The recent retests on March 29 and April 19 were the latest failed attempts. As a result, XRP price has slid 20% and is currently trading at $0.422.
A bounce off this stable support level is likely to trigger a rally in Ripple price. The targets of this recovery rally include $0.609 and $0.765, provided the remittance token can flip the $0.532 resistance level into a support level.
XRP/USD 3-day chart
While the outlook for Ripple price is extremely optimistic, it is contingent on Bitcoin’s recovery rally. Failure in BTC to runup could result in XRP price flipping the $0.422 support level into a resistance barrier. Such a move would invalidate the bullish thesis and potentially trigger a retest of the range low at $0.288.
