A turbulent week for the cryptocurrency markets has seen sharp price swings, putting significant downside pressure on both Ethereum (ETH) and Bitcoin (BTC), according to noted analyst MooninPapa. In recent technical reviews, a bearish flag pattern on the Ethereum chart has become prominent, setting a new downside target of $1,075 for the coin’s price trajectory.
Support breaks in Bitcoin
On Wednesday, Bitcoin’s price fell about 2% to a low of $74,243, slipping below even the short-term trough seen last Saturday. MooninPapa noted that this move breached Bitcoin’s nearest support band, targeting a short-term price of $71,474 as the next level to watch.
MooninPapa described Bitcoin’s on-balance volume (OBV) indicator as “at the very peak of the roller coaster.” As the TBO indicator closed, a signal was confirmed for short positions, increasing the likelihood of further downside moves. While a brief bounce is possible, the overall picture remains weak, he said.
Technical tools such as the Trend BreakOut (TBO) system are used to identify trend shifts or sideways breakouts, while OBV aggregates price changes and trading volumes to provide insights into buying and selling momentum on the market.
Mini glossary: TBO (Trend BreakOut) highlights new trends arising from price moves out of certain ranges. OBV (On-Balance Volume) combines price and volume to gauge capital inflows and outflows.
Major breakdown in Ethereum targets $1,075
Ethereum has repeatedly tested a long-term support level since February, but on Wednesday, it dipped below it yet again. Attempts to reclaim the lost support were unsuccessful. As confirmed by MooninPapa, this forms a classic bear flag, projecting a target of $1,075 based on the technical setup. With ETH currently hovering around $2,026, this points to a potential 47% drop.
The daily RSI for ETH has dropped to 24.87, entering the oversold zone. Reflecting on this, MooninPapa reminded traders that in February, ETH’s RSI dipped as low as 11.49—a level that triggered strong buying interest. While such conditions could reignite buying, those signals have not yet appeared.
Market cap sinks, stablecoin pressure mounts
Excluding stablecoins, the total crypto market cap has dipped below the support of $2.19 trillion, and even under $2.17 trillion. The analyst highlights a crucial juncture at $2.16 trillion, with the risk of a sharper downturn if this level fails to hold.
The combined dominance of USDT and USDC among stablecoins surged to 10.79% on Wednesday, reaching levels not seen in quite some time. The stablecoin dominance index, compressed over recent weeks akin to a Bollinger Band squeeze, usually precedes significant price movements.
Mini glossary: Stablecoin dominance shows the proportion of major stablecoins (like Tether or USDC) in the total crypto market cap. An elevated rate often signals that investors are fleeing to safer assets amid market uncertainty.
Shifts in altcoins and Bitcoin dominance
Technically, Bitcoin’s market share (dominance) just generated a signal indicating potential downside. MooninPapa cautioned that, while such moves can embolden altcoin traders, the reality is that market dynamics are more complex than they appear on the surface.
If BTC dominance approaches 60.60%, more pressure could build on altcoins. Meanwhile, ongoing bearish divergences have been spotted in the OTHERS.D indicator for several hours, and the TOTAL100 chart has just signaled its first short-term TBO breakout since March 2026.
| Indicator | Latest reading |
|---|---|
| BTC Dominance | Nears the critical 60.60% level |
| Stablecoin Dominance | Close to peak at 10.79% |
| ALT (OTHERS.D) RSI | Consistent decline since May |
Individual coin trends and warnings
RAIN posted a sharp 25% rally on Wednesday, pushing its RSI sky-high to 97.43. MooninPapa warned that rather than confirming further upside, the coin is moving into a dangerously overheated zone. XLM, meanwhile, jumped 11% Wednesday and added 7% Thursday morning, behaving differently from the typically correlated $XRP.
XRP’s daily RSI has slipped into oversold territory for the first time in 2024, suggesting further downside could be ahead. Elsewhere, ZEC lost a critical technical support, while AVAX faces the risk of a 60% plunge, potentially dropping to as low as $3.25.
Traditional markets diverge from crypto
The US Dollar Index (DXY) remains robust, while the USD/JPY pair has climbed toward the 160 mark. Despite the move, Japan’s central bank and finance ministry have so far avoided direct market intervention. The volatility index (VIX) has slid to 16.29, signaling muted turbulence in traditional markets.
Nvidia’s stock has dropped deeper into its daily TBO cloud, falling to $208.78. Gaps below at $189.66 and $178.23 could potentially attract prices lower. Meanwhile, the Shanghai Composite closed two days running with a strong TBO long signal. Gold retreated by 1.14%, and silver slumped another 3% after losing key support.
