Bitcoin Slices Through $11,000 For the First Time in September
After breaking out of an ascending triangle on September 14th, Bitcoin continues trending upwards. Its price appears to be marching towards the $11,300 target presented by this technical formation. Although multiple bearish signs have been popping up during the recent upswing, the buying pressure behind BTC continues increasing.
On Wednesday, September 16th, the rising demand for the flagship cryptocurrency was clear. Intelligence firm MicroStrategy doubled down on Bitcoin with the purchase of $175 million in this token. Even though the BTC in question may have been acquired via an OTC desk, prices quickly reacted to the spike in buy orders.
Bitcoin kicked off the day trading at a low of $10,783.36 and immediately began trending upwards, slicing through the $11,000 resistance level for the first time this month. The pioneer cryptocurrency saw its price rise by nearly 3% to make an intraday high of $11,099.95 around 16:00 UTC. Nonetheless, this hurdle was significant enough to reject BTC from advancing further.
The rejection was followed by a 1.43% downswing that saw Bitcoin retrace to $10,941.76 towards the end of the day. Regardless, BTC was able to jump back and close on Wednesday, September 16th, at $10,957.06. Investors were able to grasp a daily return of 1.61% due to the bullish price action.
Despite the substantial gains, the Tom Demark (TD) sequential indicator presented a sell signal on BTC’s 1-day chart. If validated, the bellwether cryptocurrency could be bound for a bearish impulse before it continues trending upwards. One of the most significant support levels underneath Bitcoin sits around $10,600.
Ethereum Continues Consolidating Within Major Bearish Pattern
From a high time frame, such as the daily chart, Ethereum seems to be developing a bear flag. The downswing that took place at the beginning of September formed the flagpole while the ongoing consolidation period is forming the flag. Such a flag has developed in the form of an ascending parallel channel that has yet to be broken to add credibility to the bearish outlook.
Ether has been consolidating within the channel since September 5th. And on Wednesday, September 16th, prices appeared to have bounced from this technical formation’s lower boundary. Ethereum opened Wednesday’s trading session at $364 and quickly dropped to the bottom of the channel at $355.
This support level was strong enough to allow prices to rebound. What came next was a 5.17% upswing that allowed ETH to make an intraday high of $373.37. But this resistance level was able to hold, containing rising prices at bay.
Following the rejection, the smart contracts giant suffered a 2.54% correction. Ethereum went down to $363.89 only four hours before the daily close. A significant number of buy orders were triggered around this price level, allowing ETH to rebound. Ethereum ended Wednesday’s trading session at $365.23 while the launch of one of the largest DeFi automatic market makers, Uniswap, was announced.
ETH provided investors with a little daily return of 0.32%. Nonetheless, a big jump was registered after Wednesday’s trading session was over, which seems to have been fueled with speculation over the release of one billion UNI tokens.
A Bearish Impulse on the Horizon
Even though the top two cryptocurrencies by market capitalization appear to be trying to recover from the substantial losses incurred at the beginning of the month, several metrics point to a further decline. The TD sequential index estimates that Bitcoin is poised to correct for one to four daily candlesticks while the bear flag that Ethereum has formed estimates a 35% downswing. Given the appearance of these bearish formations, it is imperative to implement stop losses when trading BTC and ETH to avoid adverse market conditions