After a recent surge in sell-off pressure, the market may be preparing for a recovery
Recently, Ethereum has shown a golden cross, which is often considered one of the most bullish technical indicators in trading. A long-term upward trend typically begins when the 50-day moving average breaks above the 200-day moving average. However, the market has shown indifference to this.
After the golden cross formed, ETH fell instead of rising, losing support and breaking below all major moving averages. The 200-day moving average provides the only weak support near the $2,200 area, and the asset has fallen below the 50-day and 100-day moving averages, currently trading at about $2,245.
The original intention of the golden cross is completely contrary to this decline. Over the past few years, the golden cross has actually become increasingly less important. Historically, these signals do not appear at the beginning of significant bullish trends but rather at the tail end of recovery rebounds or before reversals.
In the case of Ethereum, the recent cross is a lagging result of the upward trend since April, rather than a prediction of future movements. Additionally, the macroeconomic conditions of the cryptocurrency market do not align with the optimism usually triggered by this signal.
Due to weak trading volume, insufficient follow-up actions, and being blocked at the $2,600 (previous resistance level), the future of ETH has now become more uncertain. Nowadays, the golden cross is at best a call to action, but rather a lagging indicator of market structure. It tells traders that although ETH has recently risen, no new upward trend is visible in the short term.
Unless a strong rebound occurs and quickly regains important resistance levels, this signal will be viewed as yet another false signal in a technical environment that is becoming increasingly difficult to predict.
Bitcoin plummeted
Although the market's quick reaction to Bitcoin's recent drop below the psychological threshold of $100,000 triggered panic among some investors, the market's response indicates that bulls have not stopped here. In fact, the strength and speed of Bitcoin's rise above $100,000 suggest that buyers still possess strong power, which may change the trend in the coming weeks.
Bitcoin touched the 100-day moving average on the chart (orange line), briefly broke above it, and strongly rebounded, closing above the moving average and important integer support level. This V-shaped rebound typically occurs when large buyers quickly absorb short-term panic selling, indicating that the market is bubbling under the surface.
Bitcoin has been forming a descending triangle pattern, which is often interpreted as a bearish formation, adding more significance to this rebound. However, this expectation has been questioned due to the failure to decisively break through and quickly rebound. In fact, false breakouts, where bearish expectations turn into breakout rebounds, usually occur before such price actions.
To support the bullish view, momentum indicators like the RSI also show signs of recovery after approaching oversold territory. This does not seem to be merely a 'dead cat reaction,' but rather a defensive level, as volume data supports strong buying during the rebound.
Although BTC still faces resistance at the downward trend line (around $106,000), the rebound from below $100,000 is a bullish signal that cannot be ignored. This indicates that bulls are ready to strongly intervene at the psychological support level, and if the trend continues, it may rise back to $105,000 to $110,000 faster than most expect. The next movement may happen soon, so watch for follow-up actions.
XRP holds it
When XRP's price nearly drops below the crucial technical and psychological support level of $2.00, it is on the brink of a key collapse. Just a few days ago, the token fell below all major moving averages and broke down from the symmetrical triangle pattern, which is typical bearish momentum; especially after the 200-day moving average at $2.17 no longer provided support, market sentiment rapidly declined.
However, panic did not truly occur. XRP rebounded at the last moment, successfully recovering above the $2 mark, closing at $1.90, and briefly falling. This resilience indicates that buyers who believe XRP is undervalued below $2 have clear demand. A slight increase in volume suggests that this is not merely a 'dead cat bounce,' but the beginning of a stabilization phase.
Given that XRP was clearly oversold before the rebound, the current RSI reading of 34 provides some support for a technical rebound. Maintaining the $2.00 threshold (which has been a focal point and magnet for market contention) may allow for a brief rebound to the range of $2.17 to $2.23, where the 50-day and 100-day EMAs are located.
However, XRP still has hope. It has not yet broken the bearish breakout of the triangle pattern and remains far below its 200-day moving average. For the asset to begin shifting the market structure to neutral or even bullish, it must close above $2.20 for several trading days.
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