Bitcoin (BTC) rose above $39,000 on Feb. 1 but the sharp fall in the shares of PayPal may have resulted in aggressive selling by the short-term traders.
However, in the long-term, large investors seem to be viewing the decline as a buying opportunity. On-chain monitoring resource Whalemap said that whales holding between 100 to 10,000 BTC have accumulated during the recent decline.
Fidelity recently released a paper dubbed “Bitcoin First” which highlights that Bitcoin is the most “secure, decentralized form of asset” and is unlikely to be overtaken by any of the altcoins “as a monetary good.”
The report said that Bitcoin combines “the scarcity and durability of gold with the ease of use, storage and transportability of fiat.”
Irrespective of Bitcoin’s volatility, its transaction volumes at the end of 2021 clocked an annual growth of nearly 100% over the past 5 years, according to a recent NYDIG report. This boosted Bitcoin’s annual transaction volume to $3 trillion in 2021, surpassing popular credit card network American Express which recorded $1.3 trillion worth of payments and Discover which had $0.5 trillion.
Could the accumulation by the bulls indicate that a bottom may be around the corner? Let’s study the charts of the top-10 cryptocurrencies to find out.
BTC/USDT
Bitcoin’s recovery reached the 20-day exponential moving average ($39,116) on Feb. 1, which is acting as a stiff resistance. This suggests that sentiment remains negative and traders are selling on rallies to the overhead resistance levels.
The bears will now try to pull the price below $36,632.61. If they succeed, the aggressive bulls who had purchased the recent dip may book profits, dragging the BTC/USDT pair below $35,000.
The downsloping moving averages and the relative strength index (RSI) in the negative territory indicate that bears have the edge.
Contrary to this assumption, if the price rebounds off $36,632.61, it will suggest that bulls are buying on dips. They will then make another attempt to clear the overhead hurdle at $39,600.
This is an important level to watch out for because if the pair sustains above this level, the next stop could be the 50-day simple moving average ($43,421). The bulls will have to clear this hurdle to signal a possible end of the downtrend.
ETH/USDT
Ether (ETH) broke and closed above the breakdown level at $2,652 on Jan. 31, but the bulls could not clear the overhead hurdle at the 20-day EMA ($2,792). This suggests that the bears are defending this level aggressively.
If the price slips and sustains below $2,652, it will suggest that the bears are back in action. The ETH/USDT pair could then drop to $2,476 and later to the support line of the channel. The downtrend could resume on a break below $2,159.
Conversely, if the price rebounds off the current level, it will suggest that bulls are buying on dips. The buyers will then again attempt to push and sustain the pair above the 20-day EMA. If they manage to do that, the pair could start its march toward the resistance line of the channel.
BNB/USDT
Binance Coin (BNB) rebounded off the support line of the channel on Jan. 31, indicating that bulls are buying on dips. However, the bulls could not push the price to the 20-day EMA ($407).
This indicates a lack of demand at higher levels. Both moving averages are sloping down and the RSI remains in the negative territory, indicating that bears have the upper hand. The sellers will now attempt to pull the price back below the support line of the channel.
If they succeed, the BNB/USDT pair could drop to the strong support zone at $330 to $320. Alternatively, if the price rebounds off the current level and rises above the 20-day EMA, it will indicate that the selling pressure could be reducing.
ADA/USDT
Cardano (ADA) continues to struggle to rebound off the strong support at $1. This indicates a lack of urgency among traders to accumulate at the current levels.
If the bulls fail to push and sustain the price above the moving averages within the next few days, the possibility of a break below $1 may increase. If that happens, the ADA/USDT pair could resume its downtrend.
The first support on the downside is $0.80. If this level cracks, the decline may extend to the support line of the channel. Conversely, a break and close above the 50-day SMA ($1.25) could result in a retest of the resistance line of the channel.
SOL/USDT
Solana (SOL) turned up on Jan. 31 and broke above the overhead resistance at $104.82 on Feb. 1. The price reached the 20-day EMA ($112) today which is acting as a strong resistance.
The bears are attempting to pull the price below $104.82. If they succeed, it will suggest that bears continue to sell aggressively at higher levels….
cointelegraph.com