Why the Crypto Market Is Down Today

The price of Bitcoin (BTC) deviated above its range high while the Crypto Market Cap (TOTALCAP) trades inside support. Internet Computer (ICP) returned to its parabolic ascending support trend line.

In the news today:

TOTALCAP Struggles With Support

The cryptocurrency market cap has increased alongside an ascending support trend line since October 2023. Recently, it bounced at the trend line on December 18 (green icon) and began an upward movement.

The bounce led to a new yearly high of $1.73 trillion on January 2, causing a breakout from a critical horizontal and Fib resistance area at $1.60 trillion.

However, TOTALCAP fell sharply on January 3, 2024, and returned to the $1.60 trillion area again. While the price trades below the ascending support trend line, it has not begun a downward trend yet.

The RSI is a momentum indicator traders use to evaluate whether a market is overbought or oversold and whether to accumulate or sell an asset. Readings above 50 and an upward trend suggest that bulls still have an advantage, while readings below 50 indicate the opposite.

The RSI readings are mixed since the indicator is decreasing but has generated a hidden bullish divergence (green).

So, whether TOTALCAP breaks down below $1.60 trillion or reclaims the ascending support trend line can determine the trend’s direction.

A strong bounce can lead to a 16% increase to the next resistance at $1.87 trillion, while a breakdown could cause a 10% drop to the 0.382 Fib retracement support at $1.45 trillion.

Bitcoin Deviates Above Range High

Like TOTALCAP, the BTC price has increased alongside an ascending support trend line since October. However, Bitcoin broke down from the ascending support trend line on December 28 and validated it as resistance on January 2 (red icon).

The price fell sharply the next day, validating the $41,000 horizontal area as support (green icon). It returned to the range high of $44,000 the next day but did not break out.

Whether the BTC price moves above the range high or gets rejected and falls can help determine the trend’s direction.

A movement above the range high can trigger a 6% increase to the previous ascending support trend line at $46,000. On the other hand, failure to do so can cause a 6% drop to the closest support at $41,000.

ICP Returns to Parabola

The ICP price has increased alongside a parabolic ascending support trend line since October 2023. The upward trend has been swift and resembles a five-wave upward movement.

Elliott Wave theory involves the analysis of recurring long-term price patterns and investor psychology to determine the direction of a trend.

The most likely count suggests the price has completed a five-wave increase on January 3. The bearish divergence in the daily RSI supports this.

If ICP breaks down, it can fall by 30% to the closest support at $9.

Despite this bearish ICP price prediction, a bounce at the parabola and breakout above the $14 resistance can trigger a 70% increase to the next resistance at $23.

For BeInCrypto‘s latest crypto market analysis, click here.