Bitcoin (BTC) and most major altcoins continue to witness a bloodbath on Jan. 21 and the result of the most recent downturn has been a $200 billion reduction in market capitalization.
A new report by Huobi Research, in collaboration with Blockchain Association Singapore, forecast Bitcoin to enter a bear market in 2022. The liquidity tightening measures undertaken by the U.S. Federal Reserve and other central banks across the world and the regulatory action by authorities could play spoilsport and keep crypto prices under check.
The calls for a bear market have not shaken up the resolve of MicroStrategy CEO Michael Saylor who is determined to hold on to the company’s Bitcoin holdings. Saylor said in a recent interview with Bloomberg that the firm’s strategy is to acquire and hold Bitcoin and not sell.
Could Bitcoin and most major altcoins start a relief rally from their strong support levels? Let’s study the charts of the top-10 cryptocurrencies to find out.
BTC/USDT
Bitcoin attempted a recovery on Jan. 20 when bulls pushed the price to the 20-day exponential moving average ($43,041). However, the bears had other plans as they sold this rise and pushed the price lower as seen by the long wick on the day’s candlestick.
The selling continued today and the BTC/USDT pair has broken below the strong support at $39,600. There is a minor support at $37,332.70. The bulls are likely to defend this support zone with all their might.
The oversold level on the relative strength index (RSI) also points to a possible consolidation or a rebound. If the subsequent relief rally rises above the 50-day simple moving average (SMA), it will indicate that the downtrend may be over.
Conversely, if the price plummets below the support zone, the bearish momentum could pick up and the pair may slide to $30,000.
ETH/USDT
Ether’s (ETH) long wick on the Jan. 20 candlestick indicates that the trend remains negative and traders are selling on relief rallies to strong resistance levels.
The selling has continued today and bears have pulled the price below the immediate support at $2,928.83. This opens up the doors for a possible drop to $2,652 where buyers are anticipated to mount a strong defense.
If the price bounces off $2,652, the bulls will again try to push the ETH/USDT pair above the 20-day EMA and the resistance line of the channel. If that happens, the pair could signal a change in trend.
Conversely, if bears sink and sustain the price below $2,652, the selling could accelerate and the pair may drop to $2,000.
BNB/USDT
Binance Coin (BNB) turned down from the 20-day EMA ($474) on Jan. 20, indicating that bears are defending this resistance aggressively. The sellers will now try to pull the price below the Jan. 10 intraday low at $405.60.
The downsloping moving averages and the RSI in the negative territory indicate advantage to bears. If the price sustains below $405.60 and the descending channel, the selling could intensify and the pair may drop to $325.
Conversely, if the price rebounds off $405.60 or the support line of the channel, the bulls will again attempt to push the BNB/USDT pair above the 20-day EMA and the resistance line of the channel. If they do that, it will signal a possible change in trend.
ADA/USDT
Cardano (ADA) broke and closed below the moving averages on Jan. 20. The long wick on the day’s candlestick showed that bears continue to sell on rallies.
If bears sustain the price below the moving averages, the ADA/USDT pair could drop to the critical support at $1. This is an important support to watch out for because it has not been breached on a closing basis for about ten months.
If the price turns up from the current level and breaks above the moving averages, it will indicate that traders are accumulating on dips. The buyers will have to push and sustain the pair above the descending channel to signal a possible change in trend.
SOL/USDT
Solana (SOL) formed an outside day candlestick pattern on Jan. 20. Traders sold aggressively at higher levels and pulled the price below the immediate support at $130.
The SOL/USDT pair has dropped to the strong support at $116. If this level also fails to provide support, the decline could extend to the support line of the descending channel. The downsloping moving averages and the RSI in the oversold zone, suggest the path of least resistance is to the downside.
Alternatively, if the price turns up from $116, the bulls will again try to overcome the barrier at the 20-day EMA ($146). If they manage to do that, the pair could rise to the resistance line. A break and close above the channel could signal a change in trend.
XRP/USDT
Ripple (XRP) broke and closed below the $0.75 support on Jan. 19. The bulls tried to reclaim the…
cointelegraph.com