Cryptocurrency prices continued their downward slide on Friday, with Bitcoin stuck below $83,000 while XRP and ADA remained in bearish territory. The pressure may intensify as the S&P 500 index, a key barometer for risk assets, flashed a sell signal, hinting at more trouble ahead.
S&P 500 Signals More Pain Ahead
The S&P 500 has fallen for six consecutive days, slipping below its 50-day moving average and breaching an ascending wedge pattern—an ominous technical signal. Wedges often precede sharp downturns, and if this one plays out, the index could test support at 5,777, a level last seen in January. If selling accelerates, the next key levels to watch are 5,500 and 5,131, the latter being the low from August 2024.
Several factors are fueling the slide. Former President Donald Trump’s tariff threats have raised concerns over shrinking corporate margins and weakened consumer spending. Meanwhile, NVIDIA’s earnings—a bellwether for the artificial intelligence boom—suggest the industry’s growth is cooling. Both events are making investors jittery about the Federal Reserve’s next move.
The dilemma is clear: if the Fed cuts rates to support growth, it risks stoking inflation. If it holds steady, markets could remain under pressure. As one eToro analyst told Bloomberg, “Investors want lower rates from the Fed, but they don’t want to get there by seeing a notable deterioration in the underlying economy.”
Bitcoin Faces Bearish Technical Setup
Bitcoin is struggling under the weight of the S&P 500’s weakness. The cryptocurrency has already broken below $89,100, a key January swing low, and pierced the $108,215 double-top neckline—a bearish pattern that signals further downside.
Adding to the concern, Bitcoin has also slipped beneath its 200-day Exponential Moving Average (EMA), reinforcing the idea that sellers are in control.
Where does it go from here? The next key support to watch is $73,615, a level Bitcoin last tested in March. A break below that could spark a deeper slide, while any recovery above the $89,100 neckline might ease some of the pressure.
Cardano’s Sharp Drop and a Potential Rebound
Cardano (ADA) has suffered a significant decline, plunging from $1.327 in November to $0.635 today. The coin has slipped below its 50-day and 200-day EMAs and breached the 61.8% Fibonacci retracement level, indicators that typically suggest continued weakness.
However, there is a glimmer of hope. ADA has formed a falling wedge pattern, often a bullish signal that could precede a price rebound. If history is any guide, a breakout from this formation could trigger a move higher—especially if the long-rumored Cardano spot ETF gains approval.
XRP Shows Classic Bearish Pattern
XRP is also flashing warning signs. The token has carved out a head and shoulders pattern, a bearish setup that traders often watch for breakdowns. The neckline sits at $2, and if XRP falls below this level, it could slide toward $1.62, aligning with the 61.8% Fibonacci retracement level.
However, there’s still room for a counter-move. If XRP manages to reclaim $2.4, which coincides with a major Murrey Math resistance level, it could invalidate the bearish outlook and spark a recovery.
Risk-Off Mood Could Drive More Crypto Weakness
The broader risk-off sentiment in global markets could spell further trouble for crypto assets. When equities sell off, investors often rotate into safer investments, leaving riskier assets like Bitcoin and altcoins vulnerable to deeper corrections.
At the same time, there’s an argument that a dip toward $73,680 for Bitcoin could be a bullish retest of support, setting the stage for a future rally. For now, though, traders are bracing for more turbulence.
