Nothing static about today's price action. Yesterday I touched on the lack of follow through to the early year rally as well as some other dark clouds on the technical front (see yesterday's Ethereum (ETH) chart). But even with my 'cautious' glasses on, I didn't expect today's pullback to be quite so sharp.
Once again it's a broad market move with no coin in particular leading the way. It appeared to be a two-legged move with Bitcoin (BTC) initially dropping like a rock from $4,020 to $3,780 and then after a brief pause, continuing on down to a low of $3,505.
ETH took a similar path from $149 to $131 before making an intra-day low just under $123. With drops between 10% and 15%, you would hope for an obvious catalyst.
But other than a technical reversal, I'm struggling to pinpoint much else. Now we are down on the year and attention starts to focus on the $3,000 - $3,100 support level in BTC.
And ETH has moved so far on the day that it has slipped behind Ripple (XRP) into third place in terms of coin capitalization! How quickly sentiment can change.
Technical Analysis As mentioned above, today's moves appear purely technical, with the market running out of momentum and the break of that trend line in ETH finally taking its toll.
The only mild positive from a technical standpoint is that both BTC (shown above) and ETH have held above the levels reached on the first pullbacks in December from $4,100 and $159 respectively.
I believe it's critical for those support levels ($3,567 and $112.35) to hold. Fail and a revisit of 2018's lows is very much on the cards.
Disclaimer: All opinions expressed by Jim Preissler are solely his opinions and do not reflect the opinions of Forbes, Forbes CryptoMarkets, their parent company or affiliates. [Ed note: Investing in cryptocoins or tokens is highly speculative and the market is largely unregulated. Anyone considering it should be prepared to lose their entire investment.] With additional commentary & technical analysis by David Hannigan....