40-years trading veteran Peter Brandt stated that if Bitcoin continues retracing it could violate the “parabolic phase” that started in December 2018 and fall up to 80 percent from current levels, taking Ethereum, XRP, and Litecoin down with it.
If current parabolic phase is violated, we could expect either an 80% correction of 7-month advance or much smaller correction w/ definition of new parabola w/ shallower slope. $BTC Note formation of possible 2-wk H&S or H&S failure pic.twitter.com/6IF1bHREAv
— Peter Brandt (@PeterLBrandt) July 7, 2019
Even though many investors have seen Bitcoin rise while waiting for altcoins to follow through, an 80 percent correction in BTC could precipitate a massive pullback of the entire cryptocurrency market. At the moment, it is too early to tell if such a correction is possible, but this technical analysis will evaluate, based on the current market conditions, whether Ethereum, XRP, and Litecoin could be due for a further drop or instead for a rebound.
The TD Sequential Indicator gave a sell signal in the form of a green nine predicting a one to four week correction that could take Ethereum down to test the 50-week moving average, which is currently sitting around $190 since the significant level of support that the 150-week moving average was providing has been violated.
ETH/USD by TradingView
Now that ETH retraced and tried to break the 50 percent Fibonacci retracement zone, a reversal candlestick is forming on the 3-day chart that could take this cryptocurrency to rebound up to the 38.2 percent Fibonacci retracement level.
Although the 50 percent Fibonacci retracement seems to be acting as a barrier due to the high concentration of demand around it,