Bitcoin (BTC) and select altcoins are showing signs of some buying near support levels. According to Arcane Research, the seven-day average real Bitcoin trading volume has dropped to the lowest level since July 2021. During the previous instance, the sharp drop in volume marked a bottom and led to a strong rally from August to October 2021.
However, Bloomberg Intelligence senior commodity strategist McGlone warned in a recent podcast that risk assets may correct as the United States Federal Reserve increases rates and reduces asset purchases.
After the corrective phase is over, McGlone expects Bitcoin to transition from a “risk-on to a risk-off asset” and “come out better off.”
In the short term, analysts at Decentrader, a crypto market intelligence firm, expect Bitcoin to stay range-bound between “$44,000 and potentially $38,000 before an eventual breakout.”
While analysts are divided on their forecasts for Bitcoin, let’s study the charts of the top-10 cryptocurrencies to find the path of least resistance.
BTC/USDT
The bears are attempting to pull Bitcoin toward the strong support at $39,600 but the long tail on the candlesticks of the past two days shows that bulls have other plans. The buyers are buying on dips but a minor negative is that they have not been able to push the price above the 20-day exponential moving average ($43,804).
Both moving averages are sloping down and the relative strength index (RSI) remains in the negative zone, indicating that bears have the upper hand. If the price turns down from the current level or the 20-day EMA, the bears will again attempt to sink the BTC/USDT pair to $39,600. This is a key level to keep an eye on in the short term.
If this level cracks, the bearish momentum could pick up as several stop-losses could be triggered. That may result in a decline to $30,000.
Alternatively, if the price rebounds off the current level or the $39,600 support, the buyers will attempt to push the pair above the moving averages. If the price sustains above the 50-day simple moving average ($47,070), the negative view will invalidate and the pair could rally to the stiff overhead resistance at $52,088.
ETH/USDT
Ether (ETH) has continued its down move and is close to the support at $2,928.83. The bulls may attempt to defend this level and start a relief rally.
If that happens, the ETH/USDT pair could rise to the 20-day EMA ($3,381). This is a key resistance to watch out for because a break above it will be the first indication that the bears may be losing steam.
A break and close above the channel will signal a possible change in trend. The pair could then start its upward march toward $4,200.
On the contrary, if the price turns down from the current level or the 20-day EMA, it will increase the possibility of a break below $2,928.83. If that happens, the pair could slide to the strong support at $2,652.
BNB/USDT
Binance Coin (BNB) continues to trade inside the descending channel pattern. The 20-day EMA ($485) has started to turn down and the RSI has dipped below 43, suggesting that bears are at an advantage.
The bulls are attempting to defend the minor support at $450. If the price rebounds off this level, the buyers will make one more attempt to clear the overhead hurdle at $500. If they succeed, it will indicate a possible change in trend.
The BNB/USDT pair could then start its northward march toward $572 and later to $617. Alternatively, if the price breaks below $450, the bears will try to pull the BNB/USDT pair to the support line of the channel.
ADA/USDT
Cardano (ADA) rallied to the resistance line of the descending channel on Jan. 18 but the bulls could not push the price above the channel. This suggests that bears are defending the resistance line aggressively.
The ADA/USDT pair has dipped to the moving averages, which could act as a strong support. The moving averages are on the verge of a bullish crossover and the RSI is in the positive territory, indicating advantage to buyers.
If the price rebounds off the current level, the bulls will again try to drive the price above the channel and the developing neckline of a possible inverse head and shoulders pattern. If that happens, the pair could start a new uptrend.
This positive view will invalidate if the price breaks and sustains below the moving averages. Such a move could pull the pair down to $1.06.
SOL/USDT
Solana (SOL) has reached near the minor support at $130. The bulls had defended this level on Jan. 10 and may again try to do so during the current decline.
If the price rebounds off the support, the bulls will again attempt to push the SOL/USDT pair above the 20-day EMA ($151). If they succeed, the pair could rally to the resistance line of the descending…
cointelegraph.com