Cryptocurrency Market Bounces Off Major Support Level
Leveraging technicals in cryptocurrency trading can be extremely difficult, especially when the market is so often driven by fundamental events that can quickly change the entire charting landscape. However, there are times where certain technicals can help guide swing trades, especially when looking at relative support and resistance points on the charts of key cryptocurrencies.
Here, we are looking at the AltDex 100 Index (ALT100), a benchmark index for large-cap cryptocurrencies and tokens. In contrast to the full market charts found on sites like CoinMarketCap, the ALT100 does not contain any stablecoins or egregious forks and features only the top 100 coins by market cap. Within this benchmark, Bitcoin has a weight of roughly 58.8% with Ethereum (ETH) and XRP at 10.8% and 6%, respectively.
Looking at the ALT100 reveals a significant support line that has held multiple days through bearish market movements. The 70.5 level held back in August before a major turnaround in altcoin prices, and it looks to have held again over the last day
Back in August, the market was reeling after the SEC announced that it would postpone the decision on whether to allow the listing of the Cboe VanEck/SolidX ETF backed by Bitcoin to September 30. However, the downward pressure died out with the ALT100 testing 70.5 for several consecutive days before surging more than 25%.
After the market collapsed last week from the now-debunked report that Goldman Sachs would no longer pursue a Bitcoin trading desk, the 75.5 line held as the first line of support before breaking to quickly re-test the 70.5 support level. Now, the ALT100 has again bounced off 70.5 and is currently trading at 72.03, up roughly 1.4%.
Keeping an eye on the 70.5 support level will help guide trades for this coming week. For bullish investors, 75.5 is the next major point of resistance.
Disclaimer: This article’s author has cryptocurrency holdings that can be tracked here. This article is for informational purposes only and should not be taken as investment advice. Always conduct your own due diligence before making investments.