Crypto Review for May 22 - Bitcoin momentarily below $9K, Ethereum near $200. Is this the beginning of a new dump phase?

Cryptocurrencies continued dropping hard on Thursday, with Bitcoin (-4.81%) close to break beneath $9,000, Ethereum (-5.14%) back below $200 and Ripple (-3.64%) under 0.2 once more, only a few of assets move significantly against the current, such as Bytecoin( +20.55%), SOLVE(+31.54%), or OmiseGO (+35.32%).
The Ethereum-based tokens are mostly in the red, with the remarkable exception of OMG (+35.32%), BXK(+41.88%), and SOLVE(+29.4%) among others. On the negative side, THETA (-11.38%), ZRX(-9.18%), HEDGE(-8.34%), and LINK(-6.07%) are leading the losses among the top projects.

Fig 1 - 24H Crypto Sector Heat Map

The market capitalization dropped by 5.65% to $246.52 billion, as the 24-hour volume moved to $39.142 billion, a 6.6% increase. Finally, Bitcoin dominance increased slightly to 67.30%.

Top 10 Performers

Source (CoinMarketCap)

Bottom 10 Performers

Source (CoinMarketCap)

News Sentiment Analysis

Crypto-related news

• CoinPayments and Shopify Formalize Their Ongoing Partnership (Nulltx)

• Chinese Officials Propose East Asian Stablecoin (Cryptobriefing)

• 1850 New USDT Addresses Being Recorded Every Hour (Beincrypto)

• Iranian President Calls for National Crypto Mining Strategy (Coindesk)

• U.S. Congressman pushes blockchain bill that seeks to provide more regulatory clarity (The Block)

• Crypto 'Gray' Markets Could Be Unintended Consequence of FATF Travel Rule (Coindesk)

• $22 million: dYdX's perpetual bitcoin swap market reports a volume bump days after launching (The Block)

• Bitcoin movement triggers negative sentiment across the Options market (AMBCrypto)

• Binance aims to create one of the world's largest blockchain-based travel agencies (The Block)

• UMA's new ETH/BTC synthetic token is its first one with a 'priceless' design (The Block)

Mainstream news

• Dow closes down 102 points as energy and tech stocks slump amid rising China tensions (Marketwatch)

• U.K. retail sales fall by a record 18% in April, clothing sales slump 50% (Marketwatch)

• The U.S. coronavirus crisis is far from over, researchers say (CNN)

• European markets set for lower open as US-China tensions dent sentiment (CNBC)

• China is set to introduce a new security law for Hong Kong, seen strengthening hold over city (CNBC)

• Asian markets fall on U.S. friction with China, new Hong Kong worries (Marketwatch)

• India's central bank unexpectedly slashes its benchmark rate for the second time this year (CNBC)

Sentiment analysis

The crypto market sell-mode sentiment came as a consequence of Bitcoin not being able to cross above the $10K barrier. Still, also it was affected by the US-China renewed tensions and the drop of the traditional stock markets. The similarity between the drop on cryptos and gold is in the opinion of some analysts due to investors moving back to cash due to the uncertainty about the economic recovery and the US-China trade conflicts.

Technical Analysis

Total Market

Fig 2 - Total Market Daily

The valuation of the total crypto market cap made a sharp turn to the downside on Thursday, which has paced the action under the mid-Bollinger band, and just above the bottom edge of the ascending regression channel, as the RSI continue descending and now is in the middle of the range.

Technical Factors

• Linear regression channel points upward and price in the upper side of the channel +

• Price above its 20- 50- and 200-day SMA +

• 50-SMA crossover to its 200-SMA +

• Price near the -1 sigma line -

• RSI down below the 60 level -

• Price near the bottom of the channel -

Total Market Outlook

The market is showing weakness, as the short-term indicators tell. The mid-term trend is bullish, as indicated by the slope of the regression channel (blue). Thus, the fact that the price is touching the lower edge of the channel may trigger recovery.

Bitcoin

Fig 3 - Bitcoin 4H Chart

On Thursday, Bitcoin broke the $9,400 level, and sellers drove its price momentarily below $9,000. The candles that followed were short-bodied, showing it found buyers below that level. Currently, the price moves below the -1 sigma line and its 50-period SMA. In the chart, the price has bounced off from the bottom edge of the channel, and the RSI is also bouncing off the 30 level.

Technical Factors

• The slope of the Linear Regression Channel is positive +

• The price is making an engulfing candle (in progress) +

• The Bollinger bands point down -

• The price below the -1 sigma line of the Bollinger bands -

• The price is moving in the lower half of the regression channel -

• Price below its 50-SMA, -

• RSI descending below the 50 level -

Bitcoin's Outlook

The subsequent candlesticks show it is creating a bottoming formation. If the current engulfing candle finally holds, it may indicate a bounce from the bottom of the regression channel that could drive the price to $9,240.

Pivot Levels

Ethereum

Fig 4 - Ethereum 4H Chart

Ethereum followed Bitcoin's path and dropped from the $208 level to its previous consolidation range, erasing the gains of the past days. ETH found buyers near $192 and started a bounce and consolidation that is creating an engulfing figure in its last candle, which brought the price above the $200 level, as the RSI is making a hook near the 30 level. The price is now above its 200-period SMA, although not above its 50-period SMA. The price is still below the -1 sigma line of the Bollinger bands.

Technical Factors

• The slope of the linear regression channel is positive +

• Price making an engulfing pattern +

• RSI descending near 30 makes a hook +

• The price above 200-SMA but not above its 50-SMA -

• Bollinger bands point down -

• The price below the -1 sigma line -

Ethereum's Outlook

ETH is making a limited bounce neat the $205 level ( touching its 50-SMA, but it will need more consolidation before buyers could drive its price further up. The current short-term trend remains bearish. The pivot levels remain unchanged from the previous sessions.

Pivot Levels

Ripple

Fig 5 - Ripple 4H Chart

Ripple made a sharp bearish candle that drove its price to the $0.19. There it found buyers, so after three small-bodied candles, the last candle is completing what might be considered a complex morning star formation. In the 4H chart, we can see that the price is moving close to the mid-Bollinger line and that the RSI has made a sharp reversal from the 30.

Technical Factors

• Linear regression channel has a positive slope +

• Short-term regression channel also with positive slope +

• Strong reversal from the last bearish candlestick +

• RSI makes a hook from the 30 level +

• Price below its 200- and 50-SMA -

• Bollinger bands move downwards -

Ripple's Outlook

Ripple's bounce may signal that $0.19 is a strong support level, and that buyers may drive it further up, to the 0.20676 level, which is the topping zone of the consolidation formation XRP made after the large bearish candlestick made on May 10.

Pivot Points

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