Positive news about China’s Evergrande meltdown and the Fed’s intent to continue its current monetary pol
Positive news about China’s Evergrande meltdown and the Fed’s intent to continue its current monetary policy catalyzed a strong recovery in the price of Bitcoin and altcoins.
The crypto markets and U.S. equity markets are attempting a recovery today as fears of a widespread contagion due to Chinese developer Evergrande defaulting on its debt recede. Bridgewater Associates co-chairman and co-chief investment office Ray Dalio said on Wednesday that Evergrande’s debt was “manageable.”
Ming Tan, a director at the credit rating agency Standard & Poor’s, said that the Chinese government may step in and restructure Evergrande.
The Crypto Fear & Greed Index had plunged to 21 levels, indicating extreme fear among investors. However, while speaking on CNBC, Galaxy Digital CEO Mike Novogratz said that the crypto markets remain in good shape as long as Bitcoin (BTC) sustains above $40,000 and Ether (ETH) stays above $2,800.
Traders may now shift their focus to the Federal Reserve’s policy statement with economic and interest rate forecasts on Wednesday, which will be followed by a press conference by Fed Chair Jerome Powell.
Could Bitcoin and altcoins sustain the rebound or will higher levels attract selling by the bears? Let’s study the charts of the top-10 cryptocurrencies to find out.
BTC/USDT
Bitcoin plunged below the neckline on Sept. 21, which completed the bearish head and shoulders pattern. However, a positive was th bulls have pushed the price back above the neckline today. This suggests strong buying at lower levels.
If buyers sustain the price above the neckline, it could trap several aggressive bears, resulting in a short squeeze. The BTC/USDT pair could then rally to the 20-day exponential moving average ($46,038) where bears may pose a stiff challenge.
The moving averages have completed a bearish crossover and the relative strength index (RSI) is in the negative zone, indicating that bears are in command.
If the price fails to sustain above the neckline, the bears will attempt to resume the downtrend. The first support on the downside is $37,332.70 and then the pattern target at $32,423.05.
A break and close above the moving averages will be the first indication that the correction may be over.
ETH/USDT
Ether plummeted and closed below $3,000 on Sept. 20, which completed the bearish head and shoulders pattern. Usually, the breakdown from the neckline is retested and that is what is happening today.
The moving averages have completed a bearish crossover and the RSI is in the negative zone, indicating advantage to bears. If the price turns down from the current level, the bears will attempt to resume the down move toward the pattern target at $1,972.12.
Conversely, if bulls sustain the price above $3,000, it will indicate accumulation on dips. The ETH/USDT pair could then rally to the 20-day EMA ($3,303), which may again act as a stiff resistance. A breakout and close above this level could signal that bulls are back in the game.
ADA/USDT
Cardano (ADA) is in a strong corrective phase but the bulls are attempting to arrest the decline at the strong support at $1.94 where they are likely to run into a wall at the 20-day EMA ($2.38).
The moving averages are close to completing a bearish crossover and the RSI is in the negative territory, suggesting that bears have the upper hand. If the price turns down from the 20-day EMA, the bears may again challenge the $1.94 support.
A break and close below this level could open the doors for a further fall to $1.60. The bulls will have to push and sustain the price above the 20-day EMA to indicate the start of a sustained recovery. The ADA/USDT pair could then rise to $2.60 and later to $2.80.
BNB/USDT
Binance Coin (BNB) broke below the Sept. 7 low at $369 on Sept. 20 and reached the strong support at $340 on Sept. 21. The bulls are currently attempting to defend this level.
The moving averages have completed a bearish crossover and the RSI is below 41, indicating that bears are at an advantage. Any pullback is likely to be met with strong selling near the 20-day EMA ($410).
If bears sink the price below $340, the BNB/USDT pair could drop to the psychological support at $300 and then to $250. This negative view will be negated if bulls propel and sustain the price above the overhead resistance at $433.
XRP/USDT
XRP plunged and closed below the Sept. 7 intraday low at $0.95 on Sept. 20, suggesting that supply exceeds demand. The moving averages have completed a bearish crossover and the RSI is in the negative zone, indicating that bears have the upper hand.
The current relief rally is likely to hit a hurdle at the 20-day EMA ($1.06). If the price turns…
cointelegraph.com