Bitcoin, Ethereum, and Dogecoin Trailing the Main Market, But Is a Weekend Surge in the Cards?

bitcoin Bitcoin / US Dollar It was trading slightly higher during the 24-hour trading session on Friday, lagging behind the general market which saw a slight increase. Standard & Poor’s 500 It jumped nearly 0.6% as many technology stocks rose Positive Tesla earnings print.

The crypto sector has become detached from the general market recently, with Bitcoin, Ethereum ETH/USD And Dogecoin DOGE/USD Mostly trading is done sideways.

A sideways consolidation is healthy and needed as all three cryptocurrency RSIs are overbought after massive price increases, which started in late December. Continued sideways consolidation would help bring down the three RSI levels for the cryptocurrency.

The RSI is an indicator used by technical traders to measure bullish and bearish price momentum. RSI levels can range between 0 and 100, with levels between 30 and 70 generally considered healthy.

  • When the RSI of a stock falls below the 30% level, it is considered oversold. When the stock enters the oversold zone, this indicates that the price of the security no longer reflects the true value of the asset, which may indicate a reversal of the upward trend in the cards.
  • When a stock’s RSI rises above the 70% region, it is considered overbought. When a stock enters the overbought zone, it indicates that the price of the security has risen to its intrinsic value, which may indicate a reversal in the downward trend is on the horizon.

It is best to use the RSI when combined with other stock chart signals and patterns because stocks can remain oversold and overbought for a long period of time before reversing.

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bitcoin chart: Bitcoin has consolidated between about $22,298 and $23,824 since January 21st. On Thursday and Friday, Bitcoin consolidated into a double inside bar, with all price action in the 24-hour trading range occurring on Wednesday.

On Wednesday and Friday, Bitcoin bounced slightly to test the eight-day exponential moving average (EMA) as support and settled above the level. The eight-day EMA has been guiding Bitcoin higher on Jan 6 and may continue to act as support.

If Bitcoin closes the trading session near its high price of the day, the cryptocurrency will be printed Hammer candlestick, which may indicate higher prices on Saturday. If that happens, traders may want to see bitcoin explode above Wednesday’s high on above-average volume, which could indicate that a longer run is on the horizon.

Bearish traders want to see Bitcoin break out of its sideways trading range, which could indicate that the current bullish cycle is over and a downtrend will occur.

Bitcoin has resistance above at $24,206 and $25,772 and support below at $22,729 and $21,313.

Ethereum and Dogecoin charts: Like Bitcoin, Ethereum and Dogecoin were trading in a sideways pattern and on Thursday and Friday they were forming double inside bar patterns. The sideways pattern for Ethereum has been between $1,500 and $1,680. Dogecoin has been consolidating between $0.077 and $0.093 since January 13th.

Also like Bitcoin, Ethereum and Dogecoin were mostly holding above the eight-day exponential moving average, which could continue to guide the cryptocurrency higher. For short-term traders, closing below the 8-day moving average could be a solid exit strategy.

The Ethereum and Dogecoin bulls want to see the cryptocurrencies break out of the horizontal pattern in above-average trading volume, while the bears want to see Ethereum and Dogecoin break down from the January 18th low.

Ethereum has higher resistance at $1,717.41 and $1,957.24 and support below at $1,564.17 and $1,421.80.

Dogecoin has resistance above at $0.091 and $0.099 and support below at $0.083 and $0.075.

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