ETHXBT formed a double top pattern on its daily time frame, indicating that price is tired from the climb. Price is currently testing support at the neckline and a break lower would be enough to confirm that more losses are in the cards.
The 100 SMA is above the 200 SMA for now so the path of least resistance is to the upside and further gains might be seen. If support holds, ETHXBT could climb back to the tops at 0.03500. The neckline of the double top also lines up with the dynamic support at the 200 SMA, which seems to be the line in the sand for the uptrend.
A break below 0.01500 could push ETHXBT to the lows at 0.00500 or much lower. Stochastic is on the move down, which means that sellers are in play, while RSI is starting to turn up from the oversold area to suggest a return in buying pressure.
Bitcoin has drawn strong support from the uncertainty in the financial markets, owing to the slowdown in China and the upcoming EU referendum. A Brexit could bring more economic and financial uncertainty, which might then lead more investors to put their money into alternative assets like bitcoin and ethereum rather than equities and currencies.
In terms of virtual currencies, bitcoin appears to be winning out against ethereum due to its faster pace of mainstream acceptance. A number of major retailers such as Walmart are warming up to the idea of using bitcoin for transactions while the blockchain project among large financial institutions is also gaining traction.
With that, bitcoin could be the cryptocurrency of choice in this “uncertainty trade” leading up to the EU referendum, although a vote to stay in the EU might inspire massive profit-taking and a sharp bounce for ETHXBT.