- Bitcoin settles above the pivotal $23,000, struggles to clear $24,000.
- Ethereum bears gain control after the move below $600.
- Ripple has recovered from $0.21, but the situation is still critical.
The cryptocurrency market slipped into a red zone, with all major altcoins nursing significant losses. Bitcoin settled above $23,000 after the sell-off towards $22,600 on Wednesday. ETH broke below $600, affected by the increased bearish sentiments on the market. Some large altcoins, including XRP, Chainlink, EOS, and NEM, experienced double-digit losses.
Ripple’s saga remains the hottest topic of the day. Experts believe the legal issues of one of the largest cryptocurrency projects may have unwanted consequences for the whole industry. As FXStreet previously reported, several cryptocurrency exchanges had already suspended XRP trading or delisted the coin. Notably, the cryptocurrency asset manager Bitwise sold its XRP position within its crypto index.
The total capitalization of all digital assets in circulation dropped to $627 billion, while an average daily trading volume came close to $240 billion. Bitcoin’s market dominance jumped above 69% for the first time since September 2019.
Bitcoin settles above $23,000
Bitcoin recovered from Wednesday’s low of $22,600 reached on Monday and settled above the local resistance of $23,000. Despite the recovery, the coin is still down 1.5% on a day-to-day basis and below the critical resistance of $24,000.
BTC, 4-hour chart
From the technical point of view, BTC is supported by a combination of 4-hour EMA50. This barrier survived several breakthrough attempts and created a bullish momentum that sent the price above $23,000. At the time of writing, BTC is changing hands at $23,300. However, further recovery may be limited by the $23,900-$24,000 area that stopped the rally on several occasions recently.
BTC, In/Out of the Money Around Price (IOMAP)
Meanwhile, In/Out of the Money Around Price (IOMAP) data shows that the price sits on top of a strong support area. Over 350,000 addresses purchased 479,000 BTC from $22,300 to $23,900. If this area is cleared, the selling pressure will increase. The price may quickly collapse to $20,000 as there are no significant barriers below this level.
ETH may be ready to recover
ETH is hovering at $580, down over 5% on a day-to-day basis. The second-largest digital asset recovered from the dip to $545; however, the upside momentum seems to be limited for now, as long as the price stays below the $600-$610 area. As previously discussed, $620 is regarded as a critical barrier that needs to be taken out for the recovery to gain traction.
ETH, 12-hour chart
Meanwhile, the technical indicators imply that the reversal may be underway. TD Sequential indicator is ready to send a buy signal in the form of a red eight candlestick on a 12-hour timeframe. If this early signal is confirmed, ETH will extend the recovery towards $620 (the channel resistance). Once it is cleared, $640 followed by the recent high of $680 will come into focus.
Ripple is a whipping boy of the cryptocurrency market
XRP extended the sell-off on Thursday as cryptocurrency exchanges started to delist the coin following the lawsuit filed by the US Securities and Exchange Commission against Ripple and its top managers. If the regulator wins the legal battle, XRP will be officially considered security, meaning that all the trading platforms supporting the token will have to be registered as securities exchanges.
Currently, several lesser-known trading platforms suspended XRP trading. Coinbase, the largest US_based cryptocurrency exchange, “is considering options.”
Sources suggesting that Coinbase has already had discussions with counsel about the delisting of $XRP.
It seems two potential plans are forming, one which puts the delisting on Friday. Unclear which Coinbase products it will impact but most likely Coinbase and Pro.
— Adam Cochran (@AdamScochran) December 23, 2020
At the time of writing, XRP is changing hands at $0.27, down over 23% on a day-to-day basis. The coin tested a low of $0.21 on Wednesday before recovery started. The price stays below the critical technical barrier created by 12-hour EMA200 at $0.34. This is the first line of resistance that needs to be cleared to improve the short-term technical picture. Meanwhile, $0.45 is still the critical target for XRP bulls. A sustainable move above this area will mitigate the bearish pressure and bring the recovery back on track with the next focus on psychological $0.5 and $0.61.
XRP, 12-hour chart
On the downside, the first support is created by the weekly EMA50 at $0.25. Once it is out of the way, the sell-off will likely gain traction with the next focus on the recent lo of $0.21, followed by the psychological $0.2.