The United States equities markets are on track to finish the week in the red but that has not resulted in a deeper loss for Bitcoin (BTC). The news of cryptocurrency lender Genesis filing for Chapter 11 bankruptcy also did not have any meaningful impact on Bitcoin’s price. This shows that the selling pressure could be reducing.
However, trading firm QCP Capital warned in the latest edition of its regular markets newsletter that the current recovery in Bitcoin was only a bear market relief rally. They anticipate this recovery to be followed by another bout of selling which could sink the price of Bitcoin and Ether (ETH) below their 2022 low. QCP used the Elliott Wave analysis to arrive at this conclusion.
After an extended bear phase, the price action always climbs a wall of worry during the initial days of a new bull market. At that time, several analysts remain in disbelief as they keep expecting the price to move lower but traders could catch a change in trend if they keep an eye on the formation of higher highs and higher lows.
Are Bitcoin and select altcoins showing signs of a bottom formation? Let’s study the charts of the top-10 cryptocurrencies to find out.
BTC/USDT
Bitcoin’s price has been trading in a tight range between $20,400 and $21,650 for the past few days. Usually, a tight consolidation near a stiff resistance is a positive sign as it shows that traders are not rushing to book profits.
The upsloping moving averages and the relative strength index (RSI) in the overbought zone indicate that the path of least resistance is to the upside. Buyers will have to drive and sustain the price above $21,650 to signal the resumption of the up-move. The BTC/USDT pair could then start its journey toward $25,211.
Conversely, if bears do not allow the price to rise above $21,650, several traders who may have purchased at lower levels could be tempted to book profits. The selling could magnify on a break below $20,400.
The next support on the downside is the 20-day exponential moving average ($19,268). If the price rebounds off this support, the bulls will again try to clear the overhead hurdle at $21,650 but if the 20-day EMA cracks, the correction could extend to $18,388.
ETH/USDT
The sellers tried to start a deeper correction in Ether but the bulls purchased the dip near $1,500 on Jan. 18. This shows that the bulls are buying on minor pullbacks.
The bulls will try to propel the price above the overhead resistance zone between $1,610 and $1,680. If they succeed, the ETH/USDT pair could move to $1,800. This level may again act as a barrier but if bulls overcome it, the pair could reach $2,000.
If bears want to weaken the momentum, they will have to defend the overhead zone and yank the price below $1,500. The pair could then slide to the 20-day EMA ($1,428), which may attract buyers.
BNB/USDT
BNB (BNB) bounced off the 20-day EMA ($281) on Jan. 19 but the bulls are struggling to sustain the momentum as higher levels are attracting sellers.
The zone between the 20-day EMA and the 50-day SMA ($268) is an important one to keep an eye on because if the price turns up from it, the bulls will again try to thrust the BNB/USDT pair above $318. If they do that, the pair will complete a bullish inverse head and shoulders pattern.
On the other hand, if the price continues lower and breaks below the moving averages, it could clear the path for a possible drop to $240 and later to $220.
XRP/USDT
XRP (XRP) found support at the moving averages on Jan. 18 and turned up on Jan. 19. This indicates strong buying at the 20-day EMA ($0.37).
Buyers will try to maintain the tempo and push the price to the overhead resistance at $0.42. This is a key level for the bears to defend because if it gets taken out, the XRP/USDT pair could surge to $0.51 as there is no major obstacle in between.
The bears are likely to have other plans as they will again try to pull the price below the moving averages. If they manage to do that, the pair could plummet to the support line where buying may emerge.
ADA/USDT
Cardano (ADA) turned up from the support line of the flag pattern on Jan. 19, which is a positive sign. Buyers will try to propel the price above the flag to signal the start of the next leg of the up-move.
On a break above the flag, the bears may mount a strong defense at $0.37 but if bulls overcome this barrier, the ADA/USDT pair could soar to $0.44. This level may again prove to be a sticking point for the bulls.
This positive view could invalidate in the near term if the price turns down and plummets below the flag. That could attract further selling from short-term traders and the pair may slump to the 50-day SMA ($0.29).
DOGE/USDT
Buyers attempted to kick Dogecoin (DOGE) above $0.09 on Jan….
cointelegraph.com