With the onset of the Post-Quantitative Tightening Phase, traders are anticipating a recovery in crypto. Yet, analysis from Crypto Capital Venture suggests that before any key support is established, Ethereum and similar assets may have further downside to go.
Ethereum and Altcoins Face Further Downside Risk
The firm’s analysis of the current phase shows these altcoins are vulnerable to further weakness. Fibonacci support is located 4 to 5 percent below current valuations, but there is also potential for a steeper pullback to the 200-day moving average at $2,100, which would be a 17% drop from current levels. Such a move could be the catalyst for new buying and set up the next leg higher, so technical levels are being watched closely.
For those looking to take advantage of the situation, the advice is to place limit buy orders for Ethereum and other top altcoins via Coinbase, focusing on the Fibonacci zones. This is a way to position for a rebound without taking on undue risk.
Bitcoin’s Path: Recovery or Further Correction?
In the wake of Quantitative Tightening, Bitcoin’s price movements are of paramount importance. The current pullback has led some to expect a return to $85,000, as our colleagues at Crypto Capital Venture have noted in their analysis. A move back to that level would be bullish and could set the stage for further market gains.
On the other hand, if Bitcoin is unable to reclaim $85,000 and the decline continues, traders are watching for a retest of support between $79,000 and $80,000. It is a make-or-break zone; holding above it maintains the uptrend, but any breakdown there would indicate more extensive corrections ahead.
Cardano, XRP, and Market Cycle Signals
With the Post-Quantitative Tightening Phase in full swing, Cardano and XRP are beginning to show signs of recovery. According to Crypto Capital Venture, the two altcoins are following the broader market into a phase similar to past cycles; once tightening measures ended, expansion and growth typically followed.
Analysts suggest looking to history for context on long-term trends. There is sure to be volatility in the near term, with the ever-present possibility of an unforeseen event similar to what occurred in February 2020, but the prevailing mood among traders is one of optimism for a new cycle of growth.
Managing Volatility and Long-Term Perspective
There is a good deal of uncertainty in the Post-Quantitative Tightening Phase, and with it comes the prospect of abrupt market moves. This has been emphasized at Crypto Capital Venture: traders are advised to be cautious and brace for volatility while the transition unfolds. For now, the priority is to watch key support levels and be ready to take advantage of any strategic entries the market may present.
Of course, the market can be as unpredictable as crypto itself, but the prevailing view among traders is to keep a long-term perspective. With quantitative tightening behind us, conditions are right for patient investors to spot new opportunities as we move into the next cycle.
This article reflects the channel author’s opinion and is not investment advice.
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Source — Crypto Capital Venture: https://www.youtube.com/watch?v=6SxiKGWQMTw
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