Christine Lagarde, president of the European Central Bank, said the coronavirus pandemic has acted as a catalyst for the further spread of digital payments in the European Union. Lagarde expects that most consumers will continue to use digital services even in the future.
To support digitization, the European Central Bank has set up a working group to “examine the benefits, risks and operational challenges” of developing the digital euro and is expected to announce its results in the coming weeks.
While the central bank’s digital currency may interest consumers in the short term, it is unlikely to continue to do so because the stimulus announced around the world after the outbreak has weakened confidence in fiat currencies.
This pushed investors towards other assets such as stocks, gold, and cryptocurrencies. The Bloomberg Cryptocurrency Fact Sheet shows that the correlation between Gold and Bitcoin (BTC), when calculated on a monthly basis, has reached its highest level in 10 years. This indicates that more and more investors are viewing Bitcoin as a haven similar to gold.
However, all assets are periodically adjusted. Let’s analyze the charts of the top 10 cryptocurrencies to see if the correction is over or not.
Bitcoin / USD
The bulls are currently trying to push Bitcoin to the top of the $ 9835-10625 range. Price action in a sample is usually random and it is difficult to predict with certainty the direction of the outbreak.
It is usually assumed that a breakout will occur in the direction of the trend that prevailed before the range formation. In this case, the BTC / USD pair fell from recent highs of $ 12,460, indicating a bear advantage.
The 20-day bearish exponential moving average ($ 10.798) and the RSI in negative territory also indicate that the sellers are ahead.
If the bears fell below $ 9,835, it would likely drop to $ 9,000 and then $ 8,000. Such a move would be very negative.
However, if the bears do not take advantage of this advantage, the aggressive bears are likely to start piling up and try to push the price above $ 10,625. If they succeed, they would likely move up to $ 11,000 and then to $ 12,460.
ETH / USD
Ether (ETH) rose above $ 366 resistance on September 10, but the bears encountered resistance at the 20-day moving average ($ 379), near the 38.2% Fibonacci retracement last fall.
However, if the bulls do not abandon the big position, it will increase the probability of a breach of the 20 day moving average. If the ETH / USD continues above this resistance, it is likely to reach the 61.8% Fibonacci retracement level at $ 419,473.
The bears will try to defend this level again, but if the bulls manage to overcome this issue, then $ 488,134 will be at stake.
Contrary to this assumption, the bears will try to bring the price down to $ 308,392 if the pair reverses from current levels and drops below $ 350.
XRP / US Dollar
The bulls tried to start the rescue meeting on September 10 but were unable to hold above $ 0.245, indicating a drop in demand at higher levels. As a result, XRP fell again to support $ 0.235688.
If the price of the bears falls below $ 0.229582 on the XRP / USD pair, the next phase of the recession will likely begin. Next support drop is the $ 0.19-0.20 area.
The 20-day bearish exponential moving average ($ 0.257) and the RSI in negative territory indicate that the bears are in control.
However, if the pair bounces from current levels and rises above $ 0.250, it may rise to the 20-day moving average and reach $ 0.268478. A break above this level means the bulls are back in action.
Link / USD
Chainlink (LINK) broke the upper resistance of $ 12.89, but the bulls failed to push the price above the 20-day moving average ($ 13.35), indicating that the bears are selling aggressively on the rallies.
If the bears manage to maintain selling pressure and push the LINK / USD pair below the trend line, it might fall as low as $ 8.9080. A breakout through this support would be extremely negative.
On the contrary, if the pair rises from the current level or trend line, the bulls will again attempt to measure the price above the 20 day moving average. If they succeed, the downtrend line is likely to weaken.
Breaking this resistance increases the potential for a rally to $ 17.77, then tops at $ 20.1111.