This is a technical analysis post by CoinDesk analyst and Chartered Market Technician Omkar Godbole.
Payment focused cryptocurrency has taken a hit this week, falling more than 6% to $2, a level that has become a make-or-break line for the Ripple-linked token.
Since last December, this level has emerged as a bear fatigue zone, a place where selling pressure tends to ease, as indicated by the lower wicks of several weekly candles.
Takeaway: if and when the $2 support gives way, disappointed holders may run for the exit, causing a longer price decline.
For now, prices are holding the support line. For the outlook to be bullish, prices need to overcome the descending trend line that connects lower highs since July and is currently hanging around $2.50.
Speaking of bitcoin the leading cryptocurrency is hovering near what may be the most crucial trio of support since forever: a bullish trendline that has tracked higher lows through 2023 and 2024, the 100-week simple moving average (SMA), and the 38.2% Fibonacci retracement from the brutal bear market bottom of late 02.02, recently hitting an all-time high of $02.06. high.
Break that and attention shifts to April’s swing lows near $74,500, and then to the peak of the 2021 bull market, just back at $70,000. Some traders are already making their moves, preparing for sub-$80,000 BTC in the early days of 2026.
On the higher side, BTC bulls need to recapture the 50-week SMA, the critical lifeline just above $102,252, if they want to convince the market that the broader bull run is still alive and kicking.
Nasdaq top in?
The task may be easier said than done as a classic “hanging man” candlestick pattern has appeared on the Nasdaq monthly chart, warning of impending weakness. Both BTC and tech stocks tend to move in lock steps more often than not.
Characterized by a small real body near the top of the candle, a long lower shadow that is at least twice the length of the body, and little or no upper shadow, the pattern indicates that selling pressure is emerging and the uptrend may be losing momentum.
When it appears at record highs, as in the case of the Nasdaq, it warns of a potential reversal or a pause in the upward movement, suggesting that traders should watch for confirmation of a bearish reversal in subsequent candles.
So between XRP and bitcoin at these knife-edge supports and the Nasdaq’s choppy top signals, traders have a lot on their plates. Maybe the Santa Claus rally that both tech stocks and cryptocurrency bulls are counting on won’t come this year.
