The cryptocurrency market is showing signs of vulnerability on Monday as key digital assets face headwinds following weekend gains. The highly anticipated US-China trade talks in London today could significantly impact market sentiment, potentially triggering volatility similar to what was observed during previous negotiations.
Bitcoin Teeters Near Critical Support
Bitcoin is currently consolidating above the $105,000 mark after recovering from Thursday’s sharp decline. Trading at $105,621, BTC is struggling to overcome the resistance level of $106,058, which represents December’s highest closing price .
Technical indicators present a mixed picture. The price action suggests a possible double top reversal pattern alongside a short-term resistance trendline, creating additional pressure. For traders looking to capitalize on a bullish trend, a daily close above $106,058 is crucial to avoid potential traps.
If Bitcoin manages to break through this resistance, it could continue its upward trajectory toward its all-time high of $111,980. However, investors should monitor the Moving Average Convergence/Divergence (MACD) indicator for confirmation of this potential uptrend.
On the downside, the uncertainty surrounding the London talks could push Bitcoin to retest the $100,718 support level, which was last tested during Thursday’s low.
BTC/USDT daily price chart. Source: Tradingview
Ethereum Struggles Below $2,500
Ethereum is extending its losses below the $2,500 mark, dropping nearly 1% as of Monday morning. The price action indicates a potential reversal with an evening star pattern, characterized by Saturday’s 2% rise followed by Sunday’s Doji candle .
Notably, Ethereum has failed to reclaim the $2,600 level it lost during Thursday’s market crash, suggesting significant resistance overhead. Momentum indicators are signaling increasing selling pressure, with the MACD and its signal line declining toward the zero line .
Traders might find selling opportunities if Ethereum closes below the 200-day Exponential Moving Average (EMA) at $2,461, with the next support level at $2,357, which coincides with the 50-day EMA.
For a bullish reversal, Ethereum would need to overcome the $2,700 barrier, potentially leading to multiple peaks similar to those formed in May.
ETH/USDT daily price chart. Source: Tradingview
Ripple XRP Caught Between Key Moving Averages
Ripple’s XRP is down almost 2% on Monday, struggling to break above the 50-day EMA. For nearly two weeks, XRP has been trapped between the 200-day EMA and the 50-day EMA, creating a consolidation range .
Despite Sunday’s 4% surge, XRP failed to complete a double bottom reversal pattern. The intraday decline is pushing XRP back toward the 200-day EMA at $2.08, suggesting another potential pullback in the coming days .
However, the MACD indicator is on the verge of triggering a buy signal as the blue line approaches a crossover with the red line. Additionally, the RSI at 48 is bouncing back toward the halfway line, indicating a recovery in bullish momentum.
A daily close above the 50-day EMA at $2.25 could propel XRP toward May’s highest closing price of $2.58. Conversely, if XRP closes below $2.08, the correction could extend to the April low of $1.79.
XRP/USDT daily price chart. Source: Tradingview
Market Sentiment Tied to US-China Relations
The broader cryptocurrency market is edging marginally higher on Monday, but underlying weakness is gradually taking effect. Bitcoin, Ethereum, and XRP are all facing headwinds after a minor recovery over the weekend, risking a reversal similar to Thursday’s flash crash.
The US-China trade talks scheduled for Monday in London represent a highly volatile catalyst with the potential to cause sharp market movements. Previous discussions on May 12 in Geneva resulted in a 90-day pause in tariffs, which sparked a quick recovery in the S&P 500 and a delayed positive reaction in Bitcoin.
As Trade Secretary Scott Bessent and Vice Premier He Lifeng prepare to meet, the short-term weakness in the crypto market suggests speculation-based corrective measures, with investors potentially cashing out to mitigate risks associated with any negative developments from the high-level meeting.
