At this time, the market is full of bear and bull traps.
The bear trap just set by Shiba Inu has shocked those shorting this meme token. SHIB briefly fell below the 50-day moving average and broke below the support level of $0.000012, seemingly showing a clear technical breakdown. With shrinking volume and weakening momentum indicators, the bears seem to have finally gained the upper hand. Many traders may view this move as evidence of a trend reversal, but this interpretation is costly and premature.
SHIB did not continue to decline, but rather quickly retraced its gains, recovering the breached support level and closing above the 50-day moving average within minutes. Later, bears often panic due to such false breakouts, while bulls actively adjust their positions. The subsequent price movement corroborated this hypothesis: SHIB fell back to $0.00001305, indicating that market confidence is recovering, and with increasing volume, it may signal the beginning of a local rebound.
The mechanism of this setup points to traditional consolidation, which is used to clear out weak hands before an asset returns to its previous trend. This is a covert but effective market strategy that is often employed when market sentiment is unstable and liquidity is limited.
Technically, $0.00001339 and $0.00001350 are currently resistance levels for SHIB. If these resistance levels are broken, bullish momentum may reignite. On the downside, the blue trend line around $0.000012 and $0.00001256 is an important support level. As long as these levels persist, the bears will maintain a defensive posture.
Bitcoin is ready to handle volatility.
Bitcoin's volatility is about to begin contracting. After experiencing a strong rise and briefly touching nearly $119,000, the asset has entered a consolidation phase, with daily fluctuations gradually narrowing. Currently, the price of Bitcoin is around $118,900, approaching the upper resistance level and forming a clear horizontal line below the local high points.
Under the flat top, the support level of the 21-day moving average cleverly captured every decline, forming a typical ascending support structure, much like a pressure cooker. In the world of cryptocurrencies, such compression is rarely permanent, especially for assets like Bitcoin.
Historically, such low volatility often precedes explosive breakouts or crashes. Bitcoin's current trend includes a strong upward trend, bullish moving averages, and appropriate volume support, indicating a slightly higher likelihood of an upward breakout.
However, anyone jumping to conclusions at this point is at risk. If the closing price clearly breaks through the resistance level of $119,000-$120,000, it could immediately soar to new highs. However, if the upward trend line is broken or the breakout attempt fails, Bitcoin may retreat to test the deeper support level of $116,200, or even test the support level of the 50-day moving average at $111,200. The next round of price movement is likely to depend on a sudden increase in buying or selling volume.
XRP Stable
After several weeks of consolidation and a mid-term pullback, XRP may finally stabilize, and more importantly, it may have a chance to rise steadily. The 26-day moving average (EMA) is a dynamic support level that often serves as a launch point for trend continuation during bullish periods, and this asset has just shown a notable rebound. After a steady pullback from the recent local high of around $3.70, the price of XRP rebounded near $3.00.
Despite the appearance of some unstable daily candlestick charts, the amount of slight bullish signals significantly decreased during the pullback. This indicates that the current pullback is not driven by any strong selling pressure. In other words, traders are on the sidelines rather than panicking. The rebound of the 26-day moving average is particularly noteworthy. Since XRP surged significantly in mid-July and broke through all major moving averages, this moving average has yet to be tested.
If the price maintains this level and continues to create higher lows in the coming days, a long-term reversal structure may soon form. This could be a continuation of the initially bullish momentum. To form this structure, XRP must gradually restore the local high point structure without triggering another surge in volatility. The initial resistance level in the short term is between $3.30 and $3.40.
Breaking through this level may signal that bulls are regaining dominance and pave the way for another test of $3.70 and higher levels. Of course, this rebound still needs to be validated. If XRP cannot hold above the 26-day moving average or performs poorly in the rebound attempt, the market may revisit deeper support levels around $2.60 or even $2.30. But for now, the market pattern has taken shape.
