News
Bitcoin and Ethereum maintain stability despite market volatility
- While uncertainty surrounds the price direction of Bitcoin and Ethereum, fundamental factors such as ETFs, halving events, macro conditions, etc. they provide confidence for future bullish trends.
- Technical indicators such as the Supertrend, moving average crossovers, and the Aroon indicator suggest that both BTC and ETH are currently in bullish trends.
The two largest cryptocurrencies. – Bitcoin and Ethereum – hovered in a very narrow range while the rest of the altcoins showed strong momentum.
Numerous traders and investors are wondering whether the “bull run” that pushed Bitcoin (BTC) to unprecedented highs and led to substantial price increases for various cryptocurrencies such as Ether (ETH) during 2024 is over. Since the Bitcoin halving event, the price of BTC has hovered in the $65,000 to $72,000 range.
Uncertainty also surrounds Ethereum, the cryptocurrency associated with the smart contract-focused network created by Vitalik Buterin. Despite experiencing significant price appreciation, it struggles to decisively break through the psychological threshold of $4,000 and remains within a lateralization zone. Currently, the price of Ether (ETH) is consolidating around the $3,800 level.
From a fundamental analysis perspective, there are several compelling reasons to anticipate the continuation of the bull trend for cryptocurrencies throughout the remainder of 2024 and perhaps into part of 2025.
Highlighted among these factors are the approval of spot ETFs in the United States, the “halving effect,” macroeconomic considerations, and continued technological advances in Bitcoin. Furthermore, technical indicators are also available to validate the current active uptrend. Let’s take a look at some of these indicators.
The Supertrend indicator
The Supertrend indicator uses multi-factor analysis to determine whether the trend of a financial asset is bullish or bearish. Based on the Average True Range (ATR), the Supertrend is a trend indicator that combines trend and volatility detection in a single line calculation.
The chart below illustrates how the Supertrend generated buy signals (which remain valid) for two cryptocurrency assets. For Bitcoin, the Supertrend will continue to identify the asset as being in an uptrend as long as the daily candles close above $62,400. Similarly, for Ether, the uptrend would be invalidated if a daily candle closes below $3,360.
The bullish crossover
The use of moving average crossovers is a technique widely used in technical analysis to identify changes in the trend of a financial asset. This method involves using two moving averages with different periods: a short-term moving average (for example, 10 periods) and a long-term moving average (for example, 20 periods).
When the short-term moving average intersects above the long-term moving average, it signals the start of an uptrend for the financial asset. Conversely, when the short-term moving average crosses below the long-term moving average, it suggests the emergence of a bearish trend.
Currently, for both Bitcoin and Ether, using the widely used combination of 10-day and 20-day moving averages reveals a bullish trend.
Aroon indicator
Although not one of the most widely recognized indicators, Aroon demonstrates considerable effectiveness. Historically, it has proven invaluable in predicting significant bullish movements for both BTC and ETH, offering reliable entry and profit-taking signals.
The Aroon indicator serves as a technical tool to identify trend changes and measure their strength in the price of an asset. Essentially, it evaluates the time intervals between highs and lows over a specified period.
When the orange line crosses the blue line, it indicates an uptrend, while if the blue line dominates the orange line, a downtrend is signaled. In particular, both the Aroon indicator and the simple moving average crossover.
