Are These 2 Cryptos Making A Bullish Reversal?

The cryptocurrency market has been a real downer lately especially for any new FOMO investors who bought the May top. Seasoned crypto enthusiasts know, just like any sector, the cryptocurrency market comes in cycles and is particularly volatile.

The latest Bitcoin BTC/USD and alt-coin crash has been attributed to the China Central Bank summoning some banks and payment institutions on crypto speculations and urged banks and payment companies to cut payment channels for cryptocurrency trading. At this time, Dogecoin DOGE/USD and Ethereum Classic ETC/USD may have found a bottom.

See Also: What is Dogecoin? How to Buy Right Now

The Dogecoin Chart: Dogecoin found a bottom on June 21 at 16 cents and the following day retested the level as support. This created a bullish reversal pattern known as a double bottom and the crypto has since shot up almost 53%. On Wednesday, Dogecoin printed a bullish engulfing candlestick on the daily chart, indicating higher prices were in the cards, and on Thursday the crypto was trading up almost 5% and creating a bullish hammer candlestick.

There are three important support and resistance levels that have aligned on Dogecoin's chart and on Thursday afternoon Dogecoin was testing all three: the eight-day exponential moving average (EMA), a resistance level at 24 cents, and a downward sloping trendline that has been holding it down since May 14. If the coin can pop up to the 25-cent level, all three resistances will become support.

Dogecoin is trading at the eight-day EMA, but below the 21-day EMA and the eight-day EMA is trending below the 21-day EMA, which is bearish for the short term. Dogecoin is trading above the 200-day simple moving average (SMA), which indicates overall sentiment is bullish.

Bulls want to see Dogecoin jump up above the three major resistances and make a daily close at or above 25 cents. If it can regain the levels as support, it has room to move up to the 29-cent level.

Bears want to see Dogecoin continue to reject its upper resistances and for bearish volume to push the stock back down toward the 16-cent mark. If it were to drop below that level, it would lose support of the 200-day SMA and could fall back down to 8 cents.

See Also: Famed Short Seller Says Bitcoin Hasn't Bottomed Until Dogecoin Slips Below 1 Cent

The Ethereum Classic Chart: Ethereum Classic found a bottom shortly after Dogecoin on June 22. The 32-cent mark became a reversal spot and by Thursday afternoon the crypto was trading up 50 cents off the low. Ethereum Classic also has a downward sloping trendline to contend with that began on May 26. Bulls will want to see Ethereum classic recapture that level as support and trade back above it.

Ethereum Classic is trading below the eight-day and 21-day EMAs, with the eight-day EMA trending below the 21-day EMA, both of which are bearish indicators. The crypto is trading above the 200-day SMA, however, which is bullish.

Bulls want to see bullish volume maintained in Ethereum Classic for it to work its way up above the sloping trendline. If it can trade above the resistance, it could pop back over the 50-cent level and make its way back toward 65 cents.

Bears want to see the trendline continue to act as resistance until Ethereum Classic loses support at the 32-cent level. If it loses the level as support, it could fall down to 20 cents.