Bitcoin (BTC) and most major altcoins have been struggling to recover from the sharp fall seen on Nov. 26. This indicates that traders may be nervo
Bitcoin (BTC) and most major altcoins have been struggling to recover from the sharp fall seen on Nov. 26. This indicates that traders may be nervous to buy at current levels due to the uncertainty regarding the new heavily-mutated coronavirus strain detected in South Africa.
According to a CryptoCompare report, Bitcoin’s assets under management decreased 9.5% to $48.70 billion in November. On the other hand, the AUM of altcoin-based crypto funds increased 5.4% to $16.60 billion.
This indicates that traders may have booked profits in Bitcoin and rotated part of that money into altcoins.
Celsius founder and CEO Alex Mashinsky is unfazed by the recent decline and viewed the fall as a buying opportunity. He said on Nov. 28 that he had “bought almost $10m worth of Bitcoin and Ether at the current levels” as he anticipates Bitcoin to rally to $70,000. Mashinsky added that he would cut his latest purchases in half if Bitcoin breaks the support at $50,000.
If Bitcoin recovers from the current level, select altcoins may also attract investor attention. Let’s analyze the charts of the top-5 cryptocurrencies that may remain in focus in the next few days.
BTC/USDT
Bitcoin has been correcting in a descending channel for the past few days. The bulls are attempting to defend the 100-day simple moving average ($54,064) for the past two days but the shallow bounce indicates a lack of urgency to accumulate at the current level.
The downsloping 20-day exponential moving average ($58,521) and the relative strength index (RSI) below 39 indicate that bears are in control. If the price rebounds off the current level, the bulls may hit a wall at the 20-day EMA.
If the price again turns down from the 20-day EMA, it will increase the prospects of a break below the 100-day SMA. The pair could then challenge the support line of the channel. A break below the channel could intensify selling and sink the BTC/USDT pair to $40,000.
The bulls will have to push and sustain the price above the channel to signal that the correction may be over. The pair could pick up bullish momentum on a break and close above $61,000.
The RSI on the 4-hour chart has formed a bullish divergence, indicating that the selling pressure could be reducing. If bulls push the price above the 20-EMA and the 50-SMA, the pair could rise to $60,000.
This is an important resistance for the bulls to overcome because the previous two recoveries faltered near this level.
If the price turns down from the current level or the overhead resistance and breaks below $53,500, the selling could accelerate. The pair could then drop to the strong support at $50,000.
BNB/USDT
Binance Coin (BNB) is witnessing a tussle between the bulls and the bears near the 20-day EMA ($590). Although the price dipped and closed below the 20-day EMA on Nov. 26, the bears could not build upon this advantage.
The bears again pulled the price below the 20-day EMA today but the long tail on the candlestick shows accumulation at lower levels. The flat 20-day EMA and the RSI near the midpoint indicate a balance between supply and demand.
If bulls push the price above $621.30, the BNB/USDT pair could again rally to the overhead resistance zone at $669.30 to $691.80.
Alternatively, if the price turns down and closes below the 20-day EMA, the pair could drop to the 50-day SMA ($546). A break and close below this support could extend the pullback to the 100-day SMA ($487) and then to $440.
The price rebounded off the uptrend line on the 4-hour chart but the bears are attempting to arrest the recovery near the 20-EMA. If the price continues lower, the bears will again try to sink the pair below the uptrend line.
If they can pull it off, the pair could drop to the support zone between $564.20 and $553.80. A break below this zone could result in a sharper decline to $510.
Conversely, if bulls push and sustain the price above the 20-day EMA, the pair could rise to $621.30 and pick up momentum above it.
LUNA/USDT
Terra’s LUNA token is trading inside an ascending channel pattern. The bulls successfully defended the support line of the channel between Nov. 24-26 and have pushed the price above the 20-day EMA ($44.33) today.
If bulls sustain the price above the 20-day EMA, the LUNA/USDT pair could rise to $52 and then retest the all-time high at $54.95. The rally could face strong selling near the resistance line of the channel.
Contrary to this assumption, if the price fails to sustain above the 20-day EMA, it will indicate that traders are selling on rallies.
The bears will then again try to sink the price below the channel. If they manage to do that, it will signal a possible change in trend. The pair could then drop to $32 and later to $24.
cointelegraph.com