- The cryptocurrency market faces mounting pressure, with altcoins at pivotal levels following a week of volatility.
- Ethereum finds crucial support at $3,190 but risks a deeper decline if it fails to hold this level.
- XRP eyes a breakout above $3, while TRX struggles to break resistance, holding key support at $0.23.
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The cryptocurrency market, after a period of bullish momentum, is now in a phase of price consolidation. With the total market cap stabilizing around $3.5 trillion, last week’s trading saw a surge of exits, signaling potential trouble ahead.
This shift triggered sharp sell-offs at the start of the new week, with cryptocurrencies feeling the pressure. The sudden rise of China's AI model, DeepSeek, spooked tech stocks in the U.S., and given the strong correlation between tech and crypto, it sent digital assets into a tailspin.
Adding to the market's unease, global sentiment faltered ahead of the Fed's interest rate decision, with risk appetite on the decline. Yet, as the Fed made its move, the mood shifted, and the market regained a bullish tilt, partly fueled by Powell’s moderate stance on cryptocurrencies.
As the week unfolded, Bitcoin led the recovery, with price action that was uncertain, yet promising for the longer term. The downside risks seem to have softened, but several altcoins are still at critical crossroads. Here’s a look at four altcoins that are teetering on the edge of a bearish breakdown.
1. Ethereum Bounces Back from January Support
Ethereum has seen significant consolidation around the $3,300 mark before its recent drop. A triangle formation on the daily chart pointed to an imminent breakout in either direction. After the negative impact of DeepSeek, ETH fell below $3,300, then broke $3,200 with strong volume. The decline continued to $3,000, hitting the Fibonacci 0.618 retracement level. However, aggressive buying from this support zone confirmed $3,000 as a strong demand level, much like the January 13th sell-off.
Currently, ETH is finding support between $3,190 and $3,200, a crucial range that has acted as a key support level throughout January. As long as Ethereum closes above $3,190 on a daily basis, it could continue its recovery, with $3,300 serving as the next key resistance. A breakout above this could open up further gains toward $3,600–$3,700, breaking the consolidation phase that’s lingered since December.
However, failing to hold the $3,190 level could reignite bearish pressure, with a break below $3,000 likely to test deeper support at $2,700 (Fibonacci 0.786).
2. Ripple Seeks a New Breakout Point
Ripple started the year strong, holding at $2 before entering a correction phase in December. Its second upward phase in January led it to test resistance around $3.3. Yet, since mid-January, XRP has been on a downward trend, maintaining support at $3. The first day of this week saw a dip to $2.7, creating a prime buying opportunity, and aligning with the support trend line from the last rally.
After this brief pullback, XRP is now attempting to regain momentum above $3. Despite a failed breakout attempt earlier this week, XRP is still in an uptrend, holding above its short-term support line. If this pattern continues, XRP’s next target could be the $4 region. But if XRP fails to hold the $3 level, daily closes below this point could invalidate the bullish setup and bring $2.88 and $2.5 back into focus.
3. TRON: Will It Violate the Rising Channel Again?
TRX/USD experienced a meteoric rise last month, doubling its price before returning to its long-term rising channel. Despite the recent market-wide sell-off, TRX held steady at the $0.23 support level, staying within its short-term trading range. However, its bearish bias persists. The immediate resistance stands at $0.25, and if TRX can break above this level with volume, it could spark a new uptrend.
If the price stays below $0.25, we’re likely to see continued sideways action with a bearish tilt. The first support remains at $0.23, and a breakdown could pull the price to $0.21, aligning with the mid-line of the rising channel. Short-term indicators, like the Stochastic RSI, suggest the downtrend could persist. However, if buying volume picks up at $0.23, a new bullish trend could emerge. On the flip side, a drop below $0.20 would raise the risk of further downside for TRX.
4. Chainlink: Searching for a New Direction
After peaking at $30 in December, LINK/USD has since fluctuated, dropping to $19 before finding support at its 3-month EMA, a potential dynamic support point. This sparked a rally, which met resistance at $26. Though LINK has been on a downward trajectory over the past week, it’s showing signs of recovery, moving above the 21-day EMA at $23.8. If LINK holds this level, it could test the $25 resistance in the coming days.
To turn its outlook bullish, LINK needs to reclaim and close above $25, with strong confirmation. Success here could see LINK testing resistance levels at $26.6 and $29, possibly accelerating bullish momentum.
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Disclaimer: This article is written for informational purposes only. It is not intended to encourage the purchase of assets in any way, nor does it constitute a solicitation, offer, recommendation or suggestion to invest. I would like to remind you that all assets are evaluated from multiple perspectives and are highly risky, so any investment decision and the associated risk belongs to the investor. We also do not provide any investment advisory services.