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Bitcoin’s price action on Monday, August 31st, was quite uncertain. Although it seemed like a double bottom pattern had formed over the weekend, the erratic behavior seen on this day left many scratching their heads.
The flagship cryptocurrency was able to make a higher high and a higher low following the weekly open, but closed the day in the red.
BTC kicked off the week at a high of $11,716. Given the upwards price action seen the previous day, it was reasonable to assume that the bullish impulse was going to spill over Monday. However, Bitcoin took a 1.20% nosedive right after August 31st’s open.
The downswing saw prices hit an intraday low of $11,576, but this support level held strong, containing BTC from depreciating further. Following the rejection from this price hurdle, Bitcoin was able to rebound and regain all the losses incurred. The 1.80% jump pushed the pioneer cryptocurrency to an intraday high of $11,784 by 14:00 UTC.
Nonetheless, many investors appear to have taken advantage of the surging prices to realize profits, subsequently adding some downward pressure to Bitcoin. As a result, the bellwether cryptocurrency entered a downtrend towards the end of the day. By the time Monday’s trading session closed, BTC had pulled back by 1.10% to $11,655, providing investors a negative daily return of 0.52%.
Ethereum Sets the Tone for a Bullish Week
Unlike Bitcoin, Ethereum’s price action on Monday, August 31st, was extremely bullish as it set the tone for a potential bullish breakout. Ether continued the uptrend seen over the weekend, suggesting a potential retest of the recent yearly highs. Although prices did not get there on this day, it was evident that this resistance barrier was one of the main targets.
The smart contract giant entered the week in a positive posture, trading at a high of $428.92. However, it quickly went through a bearish impulse that saw it hit an intraday low of $418.16 by 7:00 UTC. This price level contained falling prices at bay, which served as a rebound point.
From that moment on, Ethereum began trending upwards. By 13:00 UTC, prices had risen by nearly 5% as ETH was hovering at an intraday high of $439. The substantial upswing was met with a significant number of sell orders that put some downward pressure behind the Ether.
What followed was an 11 hours stagnation period where Ethereum mostly traded between the $429 support and the $439 resistance barrier. The second-largest cryptocurrency by market capitalization was able to close the day at $433.88, providing investors with a positive return of 1.16%.
On the Cusp of a Major Bullish Breakout
Despite the high levels of volatility which Bitcoin and Ethereum are going through, it seems that these cryptocurrencies are on the cusp of a major bullish breakout. BTC appears to be on the way to take another aim at the $12,000 resistance barrier, while Ethereum is pretty close to breaking above the $447 hurdle. Slicing through these areas of resistance will be quite significant for the continuation of the bullish trend of these digital assets.
If the flagship cryptocurrency is able to turn the $12,000 resistance into support, then traders should prepare for a major price movement. Data shows that the next significant area of resistance ahead of Bitcoin sits around $14,000, which would represent a $2,000 upswing. Meanwhile, if Ethereum is able to break above the $447 supply wall, it is very likely that it will rise towards $550 or even $800, based on a “W” pattern which has now developed within its 3-day chart.
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