Cryptocurrency markets saw a sharp decline in today’s Asian session. The decline does not appear to be caused by any specific event and could be further amplified by the typically weak liquidity on Mondays in Asian markets. Another factor could be profit-taking by traders following the recent strong bull market, especially with Wednesday’s FOMC interest rate decision looming.
Technically speaking, the short-term top should be at 44727 for Bitcoin. Stock prices should continue to decline in the short term, and the possibility of further declines cannot be ruled out. However, the downside should be capped by the support of the 36710 cluster (38.2% retracement from 24896 to 44727 at 37151), leading to a rebound. A larger uptrend from 15452 is expected to resume at a later stage.
As for Ethereum, the near-term ceiling is at 2402 and we will see more consolidation trading in the near term. The outlook is cautiously bullish as long as the 1984.4 support holds, which is close to the 55 D EMA (currently in 2017) and risks a further significant pullback.
However, the broader outlook for Ethereum is less bullish as it is capped by a 38.2% retracement from 4863.7 to 878.5 at 2400. The break of the 1984.4 support mentioned above indicates a rejection to the 2400 Fibonacci level and the medium-term outlook will remain neutral at best.
