Key Insights:
- On Monday, bitcoin (BTC) and ethereum (ETH) joined the broader crypto market in positive territory, with BTC rising for the third session in eight.
- The NASDAQ mini delivered late support, fueled by easing COVID-19 measures in China and US retail sales figures.
- However, market conditions deteriorated this morning, with investors cautious as markets reopen after the holidays.
Ethereum (ETH) rose by 0.82% on Monday. Reversing a 0.25% fall from Sunday, ETH ended the day at $1,228. ETH ended the day at $1,200 for the seventh consecutive session.
After a range-bound morning, ETH slid to an early afternoon low of $1,209. Steering clear of the First Major Support Level (S1) at $1,199, ETH rallied to a final-hour high of $1,231. ETH broke through the First Major Resistance Level (R1) at $1,230 before easing back to end the day at $1,228.
On Monday, bitcoin (BTC) rose by 0.59%. Reversing a 0.10% loss from Sunday, BTC ended the day at $16,946. Notably, BTC failed to revisit $17,000 for the sixth consecutive session while avoiding the red for just the third time in nine sessions.
After a mixed morning, BTC fell to a mid-afternoon low of $16,814. Steering clear of the First Major Support Level (S1) at $16,755, BTC rallied to a final-hour high of $16,963. BTC broke through the First Major Resistance Level (R1) at $16,906. However, coming up against the Second Major Resistance Level (R2) at $16,966, BTC eased back to end the day at $16,946.
NASDAQ Delivers Brief Crypto Market Relief as Markets Reopen
It was a quiet Monday session, with the European and US markets closed for the holidays. A lack of economic indicators and light crypto news traffic left BTC and ETH within tight ranges through most of the day.
However, the NASDAQ mini delivered late support, with BTC and ETH enjoying a final-hour breakout from the tight ranges. China’s easing of COVID-19 measures and US retail sales numbers for the holidays delivered a bullish NASDAQ reopening.
Today, we expect a choppier session as the European and US markets reopen. However, with US economic indicators unlikely to influence, the NASDAQ Index will likely provide direction in the afternoon session.
Investors also need to monitor the crypto news wires and FOMC member chatter. Regulatory risk, the threat of an economic recession, and Fed fear remain crypto market headwinds.
Ethereum (ETH) Price Action
At the time of writing, ETH was down 0.36% to $1,223. A mixed morning saw ETH rise to an early high of $1,234 before falling to a low of $1,222.
Technical Indicators
ETH will need to avoid a fall through the $1,223 pivot to retarget the First Major Resistance Level (R1) at $1,236 and last week’s high of $1,239. A return to $1,230 would signal a bullish afternoon session. However, the crypto news wires and the NASDAQ Index need to deliver support for a breakout session.
In the event of an extended rally, the bulls would likely take a run at the Second Major Resistance Level (R2) at $1,245 and $1,250. The Third Major Resistance level (R3) sits at $1,267.
A fall through the pivot would bring the First Major Support Level (S1) at $1,214 into play. However, barring an event-driven sell-off, ETH should avoid sub-$1,200. The Second Major Support Level (S2) at $1,201 should limit the downside. The Third Major Support Level (S3) sits at $1,179.
Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bearish signal. Ethereum sat below the 100-day EMA, currently at $1,226. The 50-day EMA slipped back from the 100-day EMA, with the 100-day EMA easing back from the 200-day EMA, delivering bearish signals.
A move through the 100-day EMA ($1,226) would bring the R1 ($1,236) and the 200-day EMA ($1,243) into play. However, a fall through the 50-day EMA ($1,218) would give the bears a run at S1 ($1,214) and sub-$1,210 into view.
Bitcoin (BTC) Price Action
At the time of writing, BTC was down by 0.24% to $16,906. A mixed start to the day saw BTC rise to an early high of $16,987 before falling to a low of $16,866.
Technical Indicators
BTC needs to move through the $16,908 pivot to target the First Major Resistance Level (R1) at $17,001. A BTC return to $16,900 would signal a bullish session. However, the crypto news wires and the NASDAQ Index need to be crypto-friendly to support a breakout session.
In the event of an extended rally, BTC would test the Second Major Resistance Level (R2) at $17,057 and resistance at $17,100. The Third Major Resistance Level (R3) sits at $17,206.
Failure to move through the pivot would leave the First Major Support Level (S1) at $16,852 in play. Barring a crypto event-fueled sell-off, BTC should avoid sub-$16,750. The Second Major Support Level (S2) at $16,759 should limit the downside. The Third Major Support Level (S3) sits at $16,610.
An adverse crypto market event would bring sub-$16,000 into play.
Looking at the EMAs and the 4-hourly candlestick chart (below), it was a bearish signal. This morning, BTC sat below the 100-day EMA, currently at $16,930. The 50-day EMA slipped back from the 100-day EMA, with the 100-day EMA easing back from the 200-day EMA, delivering bearish signals.
A move through the 100-day EMA ($16,930) would support a breakout from R1 ($17,001) to target R2 ($17,057). However, a fall through the 50-day EMA ($16,879) would bring the Major Support Levels into view.
