- The Bitcoin price is threatened with a pullback due to the MRI sell signal.
- Ethereum price could also experience a small setback to complete a massive upward pattern.
- Ripple price is also sending out corrective signals as the MRI warns of an imminent sell-off.
Bitcoin price was able to start the second leg of its rally that began on July 20, but failed to achieve a clear closing price above a major resistance level. In addition, a technical indicator shows a sell signal, which supports further downward movement.
Therefore, investors should be prepared for a minor pullback.
Bitcoin price is facing a possible pullback
Bitcoin price soared from $ 29,994 on July 20th to $ 46,700 on August 10th. The 59% rally could be coming to an end as the Momentum Reversal Indicator (MRI) on the 12 hour chart indicated a sell signal. This setup suggests a correction. As such, investors should look for a minor pullback to the immediate support level at $ 41,330 or $ 40,550.
While a retracement is possible, the recently reversed demand zone stretching from $ 43,150 to $ 45,321 could slow the downside and cause consolidation in that area.
Either way, BTC looks bullish and could continue to rally after a brief setback.
In the event of a rise, resistance levels at $ 49,024 and $ 50,958 should be the bulls target.
BTC / USD 12-hour chart
Regardless of the bullish outlook, any spike in selling pressure pushing BTC below $ 37,241 would negatively impact the upturn and invalidate the bullish thesis as it would result in a lower low.
The Ethereum price is also threatened with a pullback
The Ethereum price is in bigger trouble than BTC as the Momentum Reversal Indicator (MRI) on the 1-day chart has also generated a sell signal. Since this setup suggests an even more extensive correction, investors should be prepared for greater losses at ETH.
The immediate support level at $ 2,640 is the most likely area for a reversal, but in some cases ETH could hit $ 2,345 again, the midpoint of the trading range.
The resulting reversal is likely to break through the $ 3,240 and $ 3,371 areas and approach the $ 3,716 resistance level.
ETH / USDT 1-day chart
Perhaps the most logical reason for the failure of the bull market thesis lies in the correlation between Ethereum and Bitcoin. When the BTC rate crashes, the ETH rate usually drops too.
Therefore, a daily closing price below $ 2,271 should invalidate the optimistic scenario and pave the way for another fall.
Ripple price is waiting for a pulse generator
The ripple price is also burdened by the MRI, which formed a sell signal on the 12-hour chart. Therefore, investors can expect a correction.
Additionally, this red flag comes after XRP price failed to break the $ 0.827 resistance level twice. The resulting downward move could reverse around $ 0.777 or head towards $ 0.689 as selling pressures mounts.
A retest of $ 0.689 would create a double bottom, and if buyers make a comeback in this space, XRP price will likely resume its rally. If the resulting surge makes $ 0.827 a support level, market participants can expect the token to hit $ 0.91 and $ 1 in a very bullish fall.
XRP / USDT 12-hour chart
While the situation is relatively good for XRP price, a break of the $ 0.725 support level could jeopardize the bullish outlook as it would create a deeper low.
However, breaking the $ 0.689 level would spell the end and invalidate the bullish scenario.