Bitcoin (BTC/USD) – Bitcoin Takes Lead, Drags Ethereum, Dogecoin Lower: What Happened?

Bitcoin BTC/USD began a steep decline at 1 p.m. Tuesday and Dogecoin DOGE/USD followed suit.

On Friday, Benzinga announced that a breakout up or down was likely to occur on Tuesday because Bitcoin was approaching the top of a symmetrical triangle, which the crypto top consolidated over the Labor Day long weekend.

After breaking out of the triangle, Bitcoin plunged almost 4%, Dogecoin fell almost 5%, while Ethereum ETH/USD was holding relatively stronger, slipping about 1% lower.

A bearish day in general markets didn’t help the situation, with the S&P 500 showing early signs of indecision before starting to decline around 0.6%.

The bearish action in the stock market and the crypto sector was likely a disappointment for many retail traders who were hoping that the start of the fall trading period could bring big money to their trading desks for a bullish finish in the third quarter.

Below is an overview of the three crypto charts.

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The Bitcoin chart: Bitcoin began trading in a symmetric triangle pattern on August 28, creating a series of higher highs and lows as volatility decreased and the daily trading range tightened. The breakout of the triangle put the crypto in a fresh downtrend, with the latest lower high formed on Monday at $20,060 and a new low formed on Tuesday.

  • The breakout of the pattern also sent Bitcoin falling below the important psychological support level of $20,000. The zone can now act as a strong resistance unless the bulls can enter and support Bitcoin in a short time.
  • If Bitcoin closes the trading day near its daily low, the crypto will print a bearish engulfing candlestick, which could indicate that lower prices will return during Wednesday’s 24-hour trading window.
  • If the crypto rebounds to close the period with a lower wick, Bitcoin will print a hammer candlestick, which could indicate that a rebound is in the cards, making another low the most likely scenario.
  • Bitcoin has resistance above $19,915 and $21,213 and support below at $17,580 and $16,000.

The Ethereum chart: The wedge that Benzinga called on Ethereum on Friday widened over the weekend, and on Tuesday the crypto tested the lower ascending trendline of the new pattern and held the area as support. The relative strength could be due to the upcoming Ethereum merger date.

  • Ethereum is trading in an uptrend within the pattern, with the most recent high formed in Tuesday’s 24-hour trading session at $1,686.82 and the most recent low printed at $1,534.54 on Tuesday. September 3.
  • If Ethereum ends the trading day near its daily low, the crypto will print a shooting star candlestick, which could indicate lower prices and a wedge breakout is on the horizon.
  • If the crypto is able to rebound and close the 24-hour session flat or near the daily high, Ethereum may continue to rise in the wedge for a longer period.
  • Ethereum has resistance above $1,717.41 and $1,957.24 and support below at $1,421.80 and $1,245.

The Dogecoin chart: Dogecoin broke down on Tuesday after a sideways trading pattern on above average volume, indicating that the bears may have taken control. As of Tuesday afternoon, Dogecoin volume on Coinbase measured around 227,000 compared to the 10-day average of 195,444.

  • The lower drop reversed a mild uptrend in which the crypto had settled into the horizontal pattern. Dogecoin also lost an important support level at 6 cents, and bullish traders will want to see Dogecoin close the 24-hour session above this level for more confidence going forward.

The eight-day and 21-day exponential moving averages (EMAs) on the Dogecoin chart have started to curve lower, which may suggest that both EMAs will continue to guide the crypto lower. Bullish traders will want to see the eight-day EMA recovered as support, which happened briefly on Tuesday morning before the crypto rejected the $0.065 level.

  • Dogecoin has resistance above $0.06 and $0.065 and support below at $0.057 and 5 cents.

See also: Bitcoin ($BTC), Dogecoin ($DOGE), Ethereum ($ETH), Tesla Motors (TSLA) September?

Photo via Shutterstock.

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