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Start for freeBitcoin Holds Critical Support
Bitcoin has managed to bounce from a critical area of support, avoiding a further crash to the downside for now. The leading cryptocurrency is still trading very close to a major level of liquidity, while Ethereum remains near an important support line. Meanwhile, Chainlink is trading within a key support zone and Solana is bouncing from short-term support.
Bitcoin Weekly Chart Analysis
On the weekly timeframe, Bitcoin is still technically within a larger bull market according to the 4-day Super Trend indicator. However, we're seeing a slowdown and loss of bullish momentum in the weekly Bitcoin MACD.
Expect choppy sideways price action between around $90,000 to $108,000 over the next 1-2 weeks. This aligns with previous predictions of sideways movement until the second half of January.
A massive bearish divergence on the weekly chart has been confirmed for nearly a month, pointing to a larger slowdown in Bitcoin's price. This suggests either a pullback, correction, or choppy sideways action in the coming weeks. Importantly, this does not necessarily signal the end of the overall bull market.
Resistance remains around $102,000 based on the 1.618 Fibonacci extension level.
Bitcoin Short-Term Outlook
On the 12-hour timeframe, Bitcoin is bouncing from the important support zone between $92,000-$93,000. This area is critical because a break below $92,000 with confirmed candle closes could lead to further downside, potentially back to the $80,000 range or lower.
For now, Bitcoin is holding this support, but traders should watch for any closes below $92,000 as a bearish signal. A head and shoulders pattern with a neckline around $92,500 could activate if support breaks, setting up a bearish target around $80,000-$81,000.
Liquidity data shows significant long liquidations clustered around $91,000. A break below this level could trigger a long squeeze, potentially accelerating downside momentum.
Key resistance levels to watch on any continued bounce are $98,500-$100,000 and $102,000-$103,000.
Ethereum Outlook
Ethereum is potentially forming a massive inverse head and shoulders pattern on the weekly timeframe. However, confirmation would require a recovery to $4,000 and a breakout above $4,000-$4,100 in the coming weeks.
On the 3-day chart, ETH is holding support just above $3,200. A breakdown below, especially under $3,000, could see the next major support at $2,800.
The daily chart shows ETH trading in a range between support at $3,000-$3,100 and resistance at $3,430-$3,560.
Chainlink Analysis
Chainlink is trading just below the critical $21 level, having bounced slightly from lows near $19. Bulls need to push LINK back above $21 within the next 2-3 days to avoid a confirmed breakdown below this key support.
Short-term support sits between $19.50-$20.50, with resistance at $24.50-$25.50. LINK has been range-bound between these levels for the past 1-2 weeks.
Solana Price Action
Solana is bouncing from support near $180, with the key zone between $180-$183 based on previous lows. A bearish divergence may be ending as the RSI approaches oversold levels.
SOL is trading in a range between $180 support and $200-$205 resistance in the short-term.
XRP Technical Outlook
XRP remains in a descending parallel channel between support around $0.80 and resistance near $0.944. The center line of the channel is at approximately $0.89.
While in this bearish structure, key levels to watch are:
- Resistance: $0.944 (channel top)
- Support: $0.825, $0.813-$0.814, $0.80 (channel bottom)
A confirmed breakout above $0.944, and especially above $0.950, would signal a potential bullish reversal.
Key Takeaways for Crypto Traders
- Bitcoin is at a critical juncture, holding support but vulnerable to further downside if $92,000 breaks.
- Ethereum needs to reclaim $4,000 to confirm a larger bullish pattern.
- Chainlink must defend $21 to avoid activating bearish targets.
- Solana is bouncing from key support, but remains range-bound for now.
- XRP is in a bearish channel structure until proven otherwise.
Traders should closely monitor Bitcoin's price action, as it will likely influence the broader crypto market in the near term. Always use proper risk management and consider the interconnected nature of cryptocurrency markets when planning trades.
Remember that market conditions can change rapidly, and past performance does not guarantee future results. Stay informed, manage your risk, and adapt your strategy as market conditions evolve.
Conclusion
The cryptocurrency market is at a pivotal point, with major assets like Bitcoin and Ethereum testing key support levels. While some bullish structures remain intact on higher timeframes, shorter-term price action suggests caution is warranted.
Traders and investors should pay close attention to the critical support and resistance levels outlined for each asset. The next 1-2 weeks may determine whether the recent pullback is merely a pause in the larger uptrend or the start of a more significant correction.
As always, proper risk management and a clear trading plan are essential when navigating volatile crypto markets. Stay vigilant, monitor key price levels, and be prepared to adapt your strategy as new information and price action unfolds.
Article created from: https://www.youtube.com/watch?v=SIPeQJYfN84&ab_channel=CryptoWorld
