Altcoins
3 Altcoins Poised to Break Key Support Levels Amid Strong Selling Pressure
- Bitcoin crashes below key support, dragging altcoins lower.
- Ethereum is struggling to find support after the initial hype around ETFs fades.
- Solana and BNB face crucial tests as overall market sentiment weakens.
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The cryptocurrency market continues its inexorable decline, with major cryptocurrencies like Bitcoin dropping dramatically since yesterday. Heavy trading volume has accompanied these losses, as key support levels have been broken across the board.
Bitcoin, in particular, suffered a sharp drop today. The daily candle closed decisively below the critical $60,000 support zone, a level that had held firmly since March. This aggressive drop in the leading cryptocurrency raises serious questions about where the next line of demarcation buyers will find in the sand.
The pain extends beyond Bitcoin. , , and , all major altcoins with significant market caps, fell alongside their leader. However, these altcoins are historically known for higher volatility, which could also translate into faster recoveries. Identifying new support levels for these altcoins becomes even more critical in this environment as they attempt to regain their footing.
1. Ethereum Pulls Back After Initial ETF Approval Wave
Ethereum has lost its gains following the ETF approval announcement. The cryptocurrency initially surged more than 25% after the SEC opened the door to spot ETFs in May. However, the prolonged uncertainty surrounding the ETF process, coupled with a general market decline, weakened demand for ETH, causing it to fall below the key $3,380 support level last week.
Since yesterday, strong selling pressure has pushed Ethereum below its next support level at $3,260 (.618 Fib), with increased selling volume. The daily outlook now shows a gap towards the $3,090 average, which is the last critical support area to prevent further declines. A loss of support just below $3,100 (.786 Fib) could strengthen the sell signal indicated by the EMA values.
Despite the bearish trend, the Stochastic RSI is worth watching for a potential trend reversal. Currently, the Stochastic RSI is rapidly declining, suggesting that the bearish momentum could continue. However, if Ethereum attracts new buyers around $3,100, it could challenge the resistance at $3,265. A break above this resistance would signal a recovery for ETH and a breakout of the short-term bearish trend. Otherwise, Ethereum could retreat further to $2,865, a demand zone highlighted during the April-May period, when daily closes below $3,100.
2. Solana approaches support level
Solana (SOL) recorded a strong bullish performance from October 2023 to March of this year, riding the general recovery trend. However, over the last three months, the cryptocurrency lost its momentum and entered a consolidation phase. Despite this, SOL has shown more resilience compared to Bitcoin, which recently broke out of its consolidation zone. 
Solana has found support in the $125-130 range on average, maintaining this horizontal outlook with lower spikes since April. Last week, SOL briefly bounced to $150, but a selloff pushed it back to the major support area, which is the .382 Fibonacci retracement level of the recent uptrend.
If SOL closes below $130 this week, it could trigger a pullback towards the $110 region. Conversely, if the current selling pressure subsides, SOL could find support around $130, which could pave the way for a break of the downtrend line and a fresh rebound. In a potential recovery, reaching the $160 region could end the formation of the lower peak and quickly increase the bullish momentum. However, daily closes below $130 pose a significant risk for SOL.
3. BNB: Key Support Levels to Watch Amid Bearish Outlook
BNB saw a rebound in June but has struggled to sustain its gains amid a bearish sideways trend since March. In early June, BNB tested the $700 region, influenced by its usage on the Binance exchange. However, persistent selling pressure and the suspension of token supply on Binance negatively impacted BNB demand.
Currently, BNB is moving rapidly towards the lower band of its channel, with $520 identified as a critical support level this week. A clear daily close below this level could confirm a downward breakout of the channel, potentially extending the decline to $450 based on Fibonacci retracement levels. Conversely, if BNB finds support around $520, it could target $550 and then $580, aligning with the channel’s upper band.
Eyes on US jobs data
Crypto markets have been under heavy selling pressure this week, partly due to Mt. Gox-related selling. Additionally, tomorrow’s US employment data release is a major stressor. Yesterday’s ADP, PMI, and PMI data all missed expectations, providing some support to risk-on markets. This has fueled speculation that the Fed could cut rates in September, with tomorrow’s data now in focus.
Recent inconsistencies between nonfarm payrolls data and other employment indicators have increased uncertainty among market participants. As a result, upcoming U.S. macroeconomic data could increase volatility in the cryptocurrency market.
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Disclaimer: This article is for informational purposes only. It does not constitute a solicitation, offer, advice, opinion or investment recommendation. It is therefore not intended to encourage the purchase of assets in any way. I would like to remind you that any type of asset is evaluated from multiple angles and is very risky. Therefore, any investment decision and the associated risk are the responsibility of the investor.