Crypto Frontline

BTCUSD (Coinbase)

Bitcoin buyers pushed through our short-term bearish trend line and that shifted the sentiment to bullish. The price is also trading above the daily 20 EMA and the RSI is edging up, both confirming the bullish momentum. 

This week, we get the FOMC and that event can stir things up across all financial markets. A dovish Fed is expected to be bullish for BTC, while a hawkish stance could lead to a stronger US Dollar, higher yields and pressure on the crypto space. 

In terms of technicals, now that Bitcoin breached above short-term resistance, the upside target is $120k – $123k. Reaching a new all-time high would be another positive development as some traders will chase the move higher. 

We’ll shift to a short-term bearish stance if BTC breaks and closes below the daily 20 EMA. At the same time, if the price gets back below the broken trend line, that will also be a sign of worry. If these conditions truly materialize, we would expect weakness into $108k and potentially $101k by mid-October. 

ETHUSD (Kraken)

Ether price action is becoming unstable and that’s usually a sign of trend maturing. The price treated the daily 20 EMA as a support area, in line with our expectations, but even after the push higher, we already see 3 consecutive days of weakness. 

This doesn’t communicate a strong commitment from the bulls, which leaves the market vulnerable to a sharper pullback. Our range remains in play and the upside cap is located around $4800-$4860. We have to break and close above it on the daily chart to continue higher towards $5000. That would be our next major resistance. 

Conversely, if ETH continues to weaken and the daily 20 EMA no longer acts as support, that would suggest the correction should extend towards $3,940. We aren’t implying the bull run is over, since buyers can still turn any correction in their favor by buying on dips. 

Our take is that between this week and the end of the month, we should start to see some weakness across the crypto space, considering seasonality is usually bearish. 

XRPUSD (Kraken)

Although XRP is still in an uptrend, bullish momentum slowed down substantially. The price is slowly grinding up in a bullish channel and right now, we are seeing weakness. Buyers are unable to drive the price action well above the 20 EMA, suggesting a balanced order flow. 

Additionally, we see chops above and below the daily 20 EMA, showing there is no clear directional bias. Those who want to buy and keep the coins for longer should wait for a deeper pullback into the daily 200 SMA, or the $2.2 area, where the lower line of the channel is located. 

Sellers could get a boost later this week, especially if the FOMC disappoints and triggers selling across the board. We are cautiously bearish in the short-term on XRP. Still, anything can happen in this market, so traders should keep an open mindset.