Bitcoin and Ethereum Fundamentals Look Strong While Technicals Spell Trouble | Crypto

Bitcoin and Ethereum show ambiguity from a technical perspective, despite rising interest behind these cryptocurrencies.

Bitcoin Whales Go Into Buying Frenzy

Overleveraged traders are getting crushed as Bitcoin becomes more volatile over time. After reaching a new all-time high of $49,700 on Feb. 14, BTC took an 8% nosedive a few hours later.

The sudden downswing to $45,350 generated more than $1.90 billion in liquidations across the board.

Despite the massive losses incurred within such a short period, sidelined investors took advantage of the downward price action to get back into the market. The spike in bullish momentum allowed Bitcoin to quickly regain the $48,000 level as support.

When considering the rate at which whales have been adding more tokens to their portfolios, the optimistic narrative holds.

Santiment’s holder distribution chart shows that the buying pressure behind Bitcoin has risen dramatically over the past three weeks. The behavioral analytics firm recorded a significant spike in the number of addresses holding 100,000 to 1,000,000 BTC.

Roughly two new whales with $4.80 billion to $48 billion worth of Bitcoin have joined the network, representing a 200% increase.

While buy orders continue to pile up behind Bitcoin, the technicals spell trouble. For instance, the Tom Demark (TD) Sequential indicator presented a sell signal on BTC’s daily chart. The bearish formation developed as a green nine candlestick, anticipating a one to four 1-day candlesticks correction.

The Relative Strength Index (RSI) also suggests that Bitcoin is primed to retrace because it sits overbought territory. This momentum indicator created a bearish divergence as it made a series of lower highs, while BTC’s price created a series of higher highs.

Given the ambiguity that Bitcoin presents, the recent high of $49,700 and the 78.6% Fibonacci retracement level are the most critical resistance and support points to watch.

A daily candlestick close above or below this trading range will determine where BTC is headed next. While bulls target $63,000 upon the break of the overhead resistance barrier, the bears will likely aim for $40,000 if the $45,000 support level fails to hold.

Ethereum Sits on Top of a Demand Barrier

Ethereum has enjoyed a slow but steady uptrend since mid-January that saw it reach a new all-time high of $1,875. The price action appears to have created a rising wedge within ETH’s 4-hour chart.

One trend line can be drawn around the swing highs while another seems to join the swing lows.

This technical pattern usually signals a price reversal….