ETHXBT continues to trend lower on its 1-hour time frame, hitting resistance at the descending trend line illustrated in an earlier article. This lined up with a Fibonacci retracement level and the dynamic resistance at the 100 SMA, which were enough to keep gains in check and push price back to its slide.
From there, ETHXBT could make its way to the swing low support at 0.01325 or to the Fibonacci extension levels. The 38.2% level is located at 0.01450, the 50% level is at 0.01385, the 61.8% level is at 0.01325, the 76.4% level is at 0.01250, and the full extension is at 0.01125.
The 100 SMA is below the longer-term 200 SMA so the path of least resistance is to the downside, which confirms that the downtrend is more likely to continue rather than reverse. Still, another quick pullback could take ETHXBT could reach until the descending trend line or the 200 SMA dynamic resistance, which is the line in the sand for a correction. A break past this level could trigger an uptrend for price.
Stochastic is on the way down, which confirms that sellers are in control of price action. However, the oscillator is already dipping into the oversold region so sellers must be feeling exhausted and willing to let buyers take over from here. RSI is also heading south so bearish pressure is in play, supporting the case for more ethereum losses.
Bitcoin has been gaining steadily against its other peers, even including fiat currencies like the US dollar and Chinese yuan. Uncertainty in the US economy leading up to the FOMC statement, NFP release, and US elections has kept a lid on dollar gains and has favored bitcoin price. Meanwhile, an influx of Chinese investor activity in bitcoin has also lifted this cryptocurrency across the board.
On the daily time frame, ETHXBT is sitting right on a major support level at 0.01500, which is the bottom of its descending triangle chart pattern. With that, a break below this floor would open up significant downside for the pair, likely leading to a tumble all the way down to the next area of interest at 0.00800-0.01000.
On this longer-term time frame, the 100 SMA is also below the longer-term 200 SMA, although the gap between the moving averages is still pretty narrow. These indicators have been oscillating so the range-bound action in this chart could continue, pending market catalysts and potential profit-taking at this major bottom. If the 100 SMA crosses above the 200 SMA on this time frame, buyers could find reason to reestablish their long positions at this market floor.
Apart from that, stochastic is heading up from the oversold region, with a slight bullish divergence. ETHXBT made lower lows while stochastic had higher lows. RSI is also turning higher to suggest that bulls might take control of price action at some point.
At this point, the odds are favoring more gains for bitcoin, but the rallies have been going on for weeks, which suggests that the moves might already be overdone and that profit-taking is due. Barring any strong catalysts, the consolidation around this major support zone could carry on for the time being. As for ethereum, the recent network attacks have forced the developers to implement a hard fork, and issues are still being monitored. Any negative updates with this digital currency could open the stage for more losses as investors doubt its stability.