A look at Bitcoin, Ethereum, Dogecoin in the weekend after the Fed’s Powell Craters markets

Bitcoin BTC/USD slipped more than 4% on Friday after the Federal Reserve chair Jerome Powell threw the markets into chaos during his annual speech at the Jackson Hole symposium.

Ethereum ETH/USD was the hardest hit, falling more than 8%, while Dogecoin DOGE/USD fell a bit more modestly in tandem with Bitcoin, down around 5%.

The bearish reaction to Powell’s hawkish tone caused all three cryptos to break bearish from the bear flag patterns that Benzinga pointed out on Wednesday.

The bear flag pattern is created with a steep drop lower forming the pole, which is then followed by a consolidation pattern that brings the stock higher between a channel with parallel lines or into a tightening triangle pattern .

For bullish traders, the “trend is your friend” (until it isn’t) and the stock may continue to rise in the next channel for a short time. Aggressive traders may decide to buy the security on the lower trendline and exit the trade on the upper trendline.

  • Bearish traders will want to watch for a break of the flag formation’s lower falling trendline on high volume for entry. When a stock breaks down from a bearish flag pattern, the measured downward movement is equal to the length of the pole and should be added to the highest price in the flag.
  • A bearish flag is canceled when a stock closes on a trading day above the upper trendline of the flag pattern or if the flag rises more than 50% along the length of the pole.

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The Bitcoin chart: Bitcoin’s bear flag pattern developed between August 15 and Thursday, with the downward slanting pole formed in the first five days of this period and the flag printing in the days that followed. . The measured movement of the pattern is around 17%, which indicates that the crypto could fall towards $18,100.

  • Friday’s sharp decline also reversed the uptrend that Bitcoin was trading within the flag formation. For Bitcoin to confirm that a new downtrend is in the cards, the crypto will need to rise to print a high below $21,925.
  • The decline occurred on above average volume, indicating that the bears are both interested and in control. At press time, Bitcoin volume measured around 29.5 million on Coinbase compared to the 10-day average of 23.78 million.
  • If the crypto closes the 24-hour trading session near its daily low, Bitcoin will print a bearish Marubozu candlestick, which could indicate that lower prices will return on Saturday. If the crypto rebounds to form a lower wick, the low may be reached and the crypto could trade higher over the weekend.
  • Bitcoin has resistance above $21,313 and $23,729 and support below at $19,915 and $18,775.

The Ethereum chart: Like Bitcoin, Ethereum broke down from a bear flag pattern that was created around the same time as Bitcoin’s flag. The measured move for Ethereum is 25%, suggesting the crypto could fall towards $1,290.

  • Unlike Bitcoin, Ethereum has yet to reverse its uptrend. If the crypto falls below the most recent low, which was printed on August 22 at $1,520, the uptrend will officially be over and a downtrend could occur.
  • Ethereum has resistance above $1,717.14 and $1,957.44 and support below at $1,421.80 and $1,245.

The Dogecoin chart: The breakdown of Dogecoin against its bear flag is less compelling as the volume of the crypto is below average, indicating that the bears are weak.

At the time of writing, the volume of Dogecoin on Coinbase stands at around 307.2 million compared to the 10-day average of 323.83 million.

  • Below-average volume hampered the decline, and although Dogecoin reversed its uptrend slightly, the sideways pattern the crypto traded in within the flag formation is still intact.
  • Dogecoin has resistance above $0.075 and $0.083 and support below at $0.065 and $0.057.

See also: What’s going on in the world with Bitcoin, Ethereum and Dogecoin falling on Friday?

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