The US Dollar is trading higher this week as US bond yields continue to rise based on hawkish Federal Reserve policy.
We see stocks in risk-off mode at the same time which makes the US currency very attractive. So those who are selling stocks will also look to go out of risky and volatile assets like cryptocurrencies (i.e. Bitcoin, Ethereum to name a couple).
This likely means that any trading bounces will see selling and that there is room for more potential weakness on major cryptocurrencies like Bitcoin BTCUSD and and Ethereum ETHUSD coins as described lower
Bitcoin (BTCUSD) is heading lower in the 4-hour chart, breaking below its December 2021 lows. It is ideally within wave (C) or (3) and there can be room for more weakness, at least towards 39k-37k area for wave (C). So, we remain bearish and we should be aware of more downside pressure while the price is below strong trendline connected from the highs and below 52200 invalidation level.
BTCUSD 4-hour Elliott Wave Chart AnalysisÂ
Ethereum (ETHUSD) is also coming down, below December 2021 lows as expected into wave C. It has room to trade down to the 2800 area or slightly lower, a leg that should be completed by a five-wave cycle. Just have in mind that we will need to see strong bounce and recovery back above 3600 level to confirm a completed wave C of an A-B-C correction, but for now we see current recovery as a sub wave (4).Â
ETHUSD 4-hour Elliott Wave Chart Analysis
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Twitter: @GregaHorvatFX
The author may have a position in the mentioned securities at the time of publication. Any opinions expressed herein are solely those of the author, and do not in any way represent the views or opinions of any other person or entity.
