Bitcoin falls below the 50-day moving average! Ethereum drops below 4000 USD, XRP's technicals collapse.

After a 5.49% fall last week, Bitcoin hovers around $107,800 on October 20, struggling to regain bullish momentum. Ethereum has fallen below the $4,000 mark, with a price hovering around $3,953 on Monday, indicating deeper retracement risks. XRP retraced over 5% last week, trading at $2.38 on Monday, encountering resistance near the downtrend line of a falling wedge pattern.

Bitcoin weekly fell 5.49%, holding the key level of 106,453

(Source: Trading View)

The Bitcoin price fell below the 50-day Exponential Moving Average (EMA) of $113,950, down 7.36% as of last weekend. This behavior of breaking below the mid-term trend moving average typically signals a weakening trend, attracting technical traders to reduce their positions or short. However, Bitcoin found support around the 61.8% Fibonacci retracement level of $106,453 over the weekend and rebounded by 2.22% the next day. As of Monday, October 20, when this article was written, the BTC price hovered around $108,700, indicating that the market is engaged in a tug-of-war near this critical support level.

If Bitcoin continues to retrace in price and closes below the support level of $106,453, the downtrend may extend to the low of $102,000 on October 10. This price level is significant both psychologically and technically, as it was the low reached during the last escalation of the Sino-U.S. trade war. $102,000 is also close to the psychologically important threshold of $100,000, which the market is very focused on. If this level is breached, it could trigger deeper panic and a technical breakdown.

On the daily chart, the Relative Strength Index (RSI) is at 40, below the neutral level of 50, indicating that bearish momentum is strengthening. The RSI has been continuously falling from a high level and has not yet entered the oversold zone (below 30), suggesting that there is still room for downward momentum to continue. Additionally, the Moving Average Convergence Divergence (MACD) also formed a bearish crossover on October 11, which is still valid, further supporting the bearish view. The MACD bearish crossover has persisted for over a week, indicating strong resilience in the downward trend.

However, if Bitcoin recovers, it may continue the recovery momentum and reach the trend line around 110,000 USD that was previously broken. This trend line connects several lows since 2024 and is an important indicator of the medium-term upward trend. Regaining 110,000 USD will reverse the current bearish technical outlook, but it requires strong catalysts, such as a trade agreement reached at the Xi-Trump meeting on October 31 or major institutions announcing large-scale purchases of Bitcoin.

Institutional investment continues to be the largest support for Bitcoin. The amount of Bitcoin held by publicly listed companies has exceeded 1 million BTC, valued at over 10.8 billion USD. This long-term holding often provides buying support during market declines, as institutions typically accumulate more at lower prices rather than panic selling. As long as this institutional demand continues, the likelihood of Bitcoin falling below 100,000 USD is relatively low.

Ethereum lost the 4000 USD level, 3593 USD becomes key support

(Source: Trading View)

Ethereum price retraced over 4% last week after breaking through the daily resistance level of $4,232. At the beginning of this week (Monday), the Ethereum price hovered around $3,953, having fallen below the psychological level of $4,000. The loss of this integer level carries significant market psychological implications, often triggering stop-loss orders and causing momentum traders to exit. As an integer threshold, $4,000 holds a special position in the minds of investors, and a breach below it could accelerate the downward momentum.

If Ethereum continues its downward momentum, the decline may extend to the 61.8% Fibonacci retracement level of $3,593, which aligns with the 200-day EMA. The overlap of these two technical indicators enhances the reliability of this support level. The 200-day EMA is a key moving average for determining long-term trends; when the price is above it, it is typically considered a long-term bullish market, and vice versa for a bearish market. The current price of Ethereum is only about 10% away from the 200-day EMA, and if it touches this support, it will be an important test of the long-term trend.

Similar to Bitcoin, Ethereum's RSI and MACD indicators also support a bearish view. The RSI is around 38, below the neutral level and close to the oversold zone, indicating that selling pressure is still dominant. The MACD also maintains a bearish cross, with the fast line consistently below the slow line, and the histogram is negative and expanding, showing that bearish momentum is strengthening. This consistent bearish signal from multiple technical indicators makes Ethereum's short-term outlook relatively pessimistic.

However, if Ethereum recovers, it may continue the recovery momentum and retest its daily resistance level of $4,232. After breaking through this resistance, the next target will be the historical high region of $4,500 to $4,800. However, under the current technical configuration, the likelihood of a rebound scenario is relatively low.

The fact that Ethereum's spot trading volume has surpassed Bitcoin's data for the first time seems extremely ironic in this bearish context. An increase in trading volume should typically be a positive signal, but when it occurs during a price fall, it often indicates panic selling rather than healthy buying. The market needs to observe the structure of trading volume; if selling dominates, it would be further bearish, but if buying starts to strengthen, it may form a bottom.

XRP falling wedge invalidated, falling towards $1.96

(Source: Trading View)

The price of XRP encountered resistance near the downtrend line of the falling wedge pattern, retreating over 5% last week. As of Monday when this article was written, the price hovers around $2.38, failing to break through the upper edge of the wedge, indicating insufficient bullish strength. The falling wedge is typically a bullish continuation pattern, but the prerequisite is that the price must successfully break through the upper trend line. Currently, XRP is oscillating within the wedge, failing to form an effective breakout, and this failure may lead to the invalidation of the wedge, evolving into a simple downward channel.

If XRP continues its downtrend, the decline may extend to the next daily support level of $1.96. This would represent a drop of about 18% from the current price, which is not impossible for an asset as volatile as XRP. $1.96 is a support level that has been tested multiple times in the past, and if it is touched again, it will be a critical test of market confidence.

Similar to Bitcoin and Ethereum, the momentum indicators RSI and MACD for XRP also support a bearish outlook. The RSI is around 37, indicating that bearish momentum is strengthening. The MACD maintains a bearish crossover, with the fast line consistently below the slow line. This consistent bearish signal from multiple technical indicators enhances the reliability of the downside forecast. The technical indicators of the three major coins are synchronously weakening, indicating that this is a result of the overall market sentiment being weak, rather than a fundamental issue with individual coins.

On the other hand, if XRP recovers, it may continue its recovery momentum, reaching $2.61 at the 200-day EMA. After breaking through $2.61, the next target will be the psychological level of $3. However, under the current momentum configuration, this rebound scenario requires a strong catalyst, such as significant positive news from Ripple or a notable improvement in overall market sentiment. Although Ripple's $1 billion buyback plan is a potential positive, the market lacks confidence in the execution details, and tangible buyback actions are needed to rebuild trust.

Three Major Coin Operation Strategies and Risk Management

Bitcoin, Ethereum, XRP are all under pressure, indicating a weak overall market sentiment. This consistency reduces the attractiveness of individual bottom-fishing opportunities. When all mainstream coins are falling, it usually means the market is undergoing a systemic adjustment rather than a temporary pullback of individual assets. Investors should reduce their overall positions and wait for the market to clarify its direction before taking active actions.

Bitcoin Trading Strategy: Mainly wait and see, a small position can be tentatively bought around 106,453 dollars, with a stop loss set at 105,000 dollars and a target of 110,000 dollars. If it falls below 106,453 dollars, immediately stop loss and exit, waiting for a better buying point around 102,000 dollars. Position control should be 5-8% of total assets, strictly enforce stop loss discipline.

Ethereum Trading Strategy: Wait for buying opportunities near $3,593, as this level coincides with the Fibonacci retracement and the 200-day EMA, providing double support for a higher success rate. Set the stop loss at $3,400, with a target of recovering the $4,000 round number. Position size should be controlled at 5-8% of total assets, managed separately from Bitcoin positions.

XRP Trading Strategy: Highest risk, it is recommended to stay on the sidelines. If the price drops to around 1.96 USD, consider taking a small position to buy the dip, with a stop loss set at 1.85 USD and a target of the 200-day EMA at 2.61 USD. Position size should be controlled at 3-5% of total assets, as XRP has high volatility and significant fundamental uncertainty, requiring stricter position control.

Core Risk Warning: The current market is facing systemic risks, including uncertainties related to the China-U.S. trade war, expectations of global economic growth slowdown, and changes in cryptocurrency regulatory policies. Liquidity risk should not be overlooked either, as rapid shifts in market sentiment may lead to extreme volatility. Only invest funds that you can afford to lose completely, and do not use leverage to amplify risks.