Bitcoin, Ethereum, and Dogecoin are still under pressure
Bitcoin chart analysis
Looking at the Bitcoin chart on the daily time frame, we see that we are still in the current sideways consolidation. For a week now, we have been testing the 50.0% Fibonacci level at $ 46950. On the downside, we still have support for a 200-day moving average in the $ 46,000 zone. We are approaching the 20-day moving average due to the sideways movement of the Bitcoin price, and it will be very interesting to follow the situation when these two moving indicators intersect. If the price is still under pressure, we can expect the price to fall below these moving averages. If that happens, we are looking for support on the chart at 38.2% Fibonacci level at $ 42,650. For the bullish trend, we expect the price to make a bullish move up outside of this side consolidation, and then our first target is $ 50,000, followed by a 61.8% Fibonacci level at $ 51,250.
Ethereum chart analysis
Looking at the Ethereum chart on the daily time frame, we see that the price after yesterday’s pullback from 61.8% Fibonacci level to $ 3350 made a turnaround again, and we headed up again once again potentially to test it. From the bottom, we are approaching the 20-day moving average, which is in the zone of around $ 3,000. If this consolidation continues in the coming period, the price will meet the 20-day moving average, and then we must pay attention to whether we will get support or the price will break below and a potentially bearish scenario towards the $ 2800 zone at 38.2% Fibonacci level. For the bullish trend, we need to get out of this consolidation above 61.8% Fibonacci levels in order to think about a more concrete increase in the price of Ethereum.
Dogecoin chart analysis
Looking at Dogecoin on the daily time frame, we see that Dogecoin also neutralized part of yesterday’s price withdrawal today, testing the zone at 0.30000. Based on today’s chart, we expect further price growth to continue towards 38.2% Fibonacci level at 0.38000. Above, we can expect resistance and some next pullback from that level. A possible option is a certain consolidation in the coming period, which will help move averages closer and potentially support the current bullish trend.
The low level of daily trading volume still exists because bitcoin is struggling to advance. At the same time, short positions are being built, according to Datamish data, which indicates a return to lower supports close to $ 44,000.
“Although the trend has turned bullish, a withdrawal is expected before continuing,” said Marcus Sotiriou, a salesman at the British digital brokerage firm GlobalBlock. “This is because there has been a decline in volume with a price increase, as well as a bearish deviation in the RSI indicator in the daily framework.”
Other significant cryptocurrencies in the first 20 by market capitalization in a period of 24 hours were mixed with polkadot (DOT, + 8.13%), Solana, and terrain, which achieved the highest gains, while ether (ETH, -3.43%), KSRP (-8.87%)), and celebrities (KSLM, -7.76%) dropped the most in the same period. Although El Salvador’s move to make Bitcoin a legal tender in the country attracted mass attention, there were also concerns. Fitch Ratings has also joined the International Monetary Fund (IMF) in raising concerns about the possible consequences of the new law.
El Salvador President Naiib Bukele announced that the country would recently adopt the leading cryptocurrency as a legal tender, marking a turning point for a new property type.
However, the decision was followed by protests, lawsuits, and criticism, including by the opposition El Salvador party, which sued the government over the new law.
Fitch Ratings suggests that there could be negative consequences since it introduced Bitcoin as a legal tender, highlighting the financial and insurance sectors in particular. The new law would force these institutions to keep their BTC or sell their cryptocurrencies to avoid price risk.
Bitcoin should become the legal tender in the country on September 7, and exchange rate instability remains a risk factor for the sovereign. Fitch believes the process of adopting a leading digital asset is “unnecessarily rushed,” leaving financial companies little time to adjust.
The IMF has also expressed concerns about digital assets, saying the new asset class could pose significant risks, and effective regulatory measures must be introduced when it comes to cryptocurrencies.
According to IMF spokesman Gerry Rice, the adoption of Bitcoin could raise several macroeconomic issues. Bukele replied that he would try to explain that making cryptocurrency a legal tender will not change their macroeconomics.
The rating agency Moody’s Investors Service downgraded the rating of the Salvadoran government because it believes that there could be increased uncertainty regarding a potential new round of financing from the IMF after the adoption of Bitcoin as a legal tender.
Moody’s believes that the financial prospects for El Salvador are still vulnerable and subject to financial shocks. If the country sees limited availability of alternative funding sources, Moody’s added that the sovereign would continue to face liquidity pressures.
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