Bitcoin (BTC) continues to be pinned down below $60,000 indicating that higher levels are attracting selling from traders.The S&P 500 made a ne
Bitcoin (BTC) continues to be pinned down below $60,000 indicating that higher levels are attracting selling from traders.
The S&P 500 made a new all-time high today on reports that U.S. President Joe Biden renominated Jerome Powell to serve a second term as the Federal Reserve chair. This news also boosted the U.S. dollar currency index (DXY) to its highest level since July 2020.
Usually, sharp gains in the DXY are inversely correlated with Bitcoin and the same can be seen in November of this year as well. While the DXY is up about 2.3% in November, Bitcoin is down roughly 5.5% during the same period.
Independent market analyst, TechDev, said Bitcoin’s performance in 2021 is following the price action of 2017 but with a lag of 5-8 days. If the correlation continues, the eagerly awaited blow-off top phase in Bitcoin is likely to occur.
Could the current fall be the final dip before the resumption of the uptrend or is the decline the start of a sharper correction? Let’s study the charts of the top-10 cryptocurrencies to find out.
BTC/USDT
Bitcoin’s recovery from $55,600 on Nov. 19 reached the 50-day simple moving average ($60,350) on Nov. 20 but the bulls could not clear this hurdle. This indicates that bears are attempting to flip the 50-day SMA into resistance.
The moving averages are about to complete a bearish crossover and the relative strength index (RSI) is in the negative territory, suggesting that the path of least resistance is to the downside.
If the price turns down and breaks below $55,600, it will indicate the start of a deeper correction to the $52,500 to $50,000 support zone.
This negative view will invalidate if the price turns up from the current level and breaks above the downtrend line. Such a move will indicate that the correction may be over.
The BTC/USDT pair could then start its northward march toward the overhead resistance zone at $67,000 to $69,000.
ETH/USDT
Ether’s (ETH) relief rally from the Nov. 18 intraday low at $3,956.44 rose above the 20-day exponential moving average ($4,364) on Nov. 20 but the bulls could not sustain the higher levels. The bears pulled the price back below the 20-day EMA on Nov. 21.
The ETH/USDT pair dropped to the 50-day SMA ($4,240) today but the long tail on the candlestick indicates that bulls are defending this support. If buyers drive the price above $4,451, the pair could rally to the 61.80% Fibonacci retracement level at $4.519.78 and then to the 78.60% retracement level at $4,672.93.
On the contrary, if the price turns down from the current level, the bears will again try to sink the pair below the 50-day SMA. If they succeed, the pair could drop to $3,956.44. A break and close below this level will complete a head and shoulders pattern. The pair could then drop to $3,400 and eventually to the pattern target at $3,047.
BNB/USDT
Binance Coin (BNB) rebounded off the 50-day SMA ($526) on Nov. 19 but the bulls could not extend the relief rally above the 61.8% Fibonacci retracement level at $602.40.
The bears have pulled the price below the 20-day EMA ($585) today. If the price sustains below the 20-day EMA, the bears will make one more attempt to sink the BNB/USDT pair below the 50-day SMA. If they succeed, the pair could slide to $485.40.
Conversely, if the price turns up from the current level and breaks above $605.20, it will suggest that bulls are back in the game. The pair could then rally to the overhead resistance zone at $659.50 to $669.30.
The flattish 20-day EMA and the RSI near the midpoint do not give a clear advantage either to the bulls or the bears.
SOL/USDT
Solana’s (SOL) bounce off the 50-day SMA ($198) hit a strong hurdle at the downtrend line on Nov. 21, indicating that bears continue to sell on rallies.
The price action of the past few days has formed a symmetrical triangle pattern suggesting a balance between supply and demand. This equilibrium will shift in favor of the bulls on a break and close above the resistance line of the triangle. The SOL/USDT pair could then retest the all-time high at $259.90.
Alternatively, if the price sustains below the 20-day EMA, the pair could drop to the support line of the triangle. The bears will have to sink the price below this support to gain the upper hand. The pair could then drop to $153.
ADA/USDT
Cardano (ADA) rose above the breakdown level at $1.87 on Nov. 20 but the bulls could not push the price above the 20-day EMA ($1.95). This suggests that sentiment remains negative and traders are selling on rallies to the 20-day EMA.
The price dipped back below $1.87 on Nov. 21 and the bears will now attempt to sink the ADA/USDT pair below $1.70. If they manage to do that, the selling could intensify and the pair could drop to $1.50.
Contrary to…
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