Bitcoin (BTC) is struggling to stay above $23,000 as the weekend approaches. The selling pressure increased after the personal consumption expenditures excluding food and energy rose 0.6% in January and 4.7% over the year, above market expectations of an increase of 0.5% and 4.4% respectively.
This could trigger fears that the United States Federal Reserve may have to continue its rate hikes to bring inflation under control. Expectations of a rate hike could strengthen the U.S. dollar index further, which is already near a seven-week high, and that may put pressure on the cryptocurrency markets in the near term.
A drop in the cryptocurrency markets may start a discussion that the rally in January may have been a bull trap. However, the price action in Bitcoin and several altcoins show that a bottoming formation may have begun. The next dip may form a higher low before attempting a move higher.
What are the important support levels in Bitcoin and altcoins? Let’s study the charts of the top-10 cryptocurrencies to find out.
BTC/USDT
Buyers successfully held the 20-day exponential moving average ($23,440) for the past two days but the failure to sustain the rebound attracted strong selling on Feb. 24.
The negative divergence on the relative strength index (RSI) suggests that the bullish momentum is weakening. The BTC/USDT pair has reached immediate support at $22,800.
A break below this level could retest the crucial support zone between the 50-day simple moving average ($22,052) and $21,480.
Alternatively, if the price fails to sustain below the 20-day EMA, it will indicate that bulls are buying the dips as they anticipate a move higher. A break and close above $25,250 may start the next leg of the uptrend.
ETH/USDT
Ether (ETH) slipped below the 20-day EMA ($1,624) on Feb. 22 but the long tail on the candlestick shows solid buying at lower levels. The bulls tried to build upon the advantage on Feb. 23 and drive the price above $1,680 but the bears held their ground.
The selling intensified on Feb. 24 and the price dropped to the 50-day SMA ($1,565). This is an important support for the bulls to guard because if it cracks, the ETH/USDT pair could plummet to $1,461.
Contrarily, if the price rebounds off the 50-day SMA with strength, it will indicate that bulls are buying the dips. The buyers will then attempt to kick the price above the $1,680 to $1,743 resistance zone and resume the up-move.
BNB/USDT
BNB’s (BNB) tight range trading between the overhead resistance of $318 and the 50-day SMA ($304) resolved to the downside on Feb. 24. This indicates that bears have overpowered the bulls.
Although the 20-day EMA ($310) is flat, the RSI has dipped below 46, suggesting that the momentum is shifting in favor of the bears. The BNB/USDT pair could slump to the $280 level. This is an important level to watch out for because a break below it will complete a bearish head and shoulders (H&S) pattern.
If buyers want to avoid the sharp decline, they will have to quickly propel the price back above $318. That could clear the path for a rise to the neckline of the bullish inverse H&S pattern.
XRP/USDT
XRP (XRP) traded near the resistance line of the descending channel pattern for the past few days but the bulls could not enforce a breakout.
That may have attracted selling from the short-term bears who yanked the price below the moving averages. The XRP/USDT pair could now drop to the solid support at $0.36. If this level also fails to hold up, the decline may extend to $0.33.
Contrary to this assumption, if the price rebounds off $0.36, the bulls will make one more attempt to overcome the barrier at the resistance line. If they can pull it off, the pair may rally to the overhead resistance at $0.43.
ADA/USDT
The bulls managed to keep Cardano (ADA) above the immediate support of $0.38 for the past two days but they failed to sustain the rebound above the 20-day EMA ($0.39). This suggests that bears are selling on minor rallies.
The price dropped to the 50-day SMA ($0.37) on Feb. 24. If this support gives way, the ADA/USDT pair could slide to the strong support zone between $0.34 and $0.32. Buyers are expected to defend this zone with all their might because if they fail to do that, the selling may intensify and a drop toward $0.27 could not be ruled out.
Conversely, if the price turns up from the current level, the bulls will again try to thrust the price above the 20-day EMA and retest the neckline of the inverse H&S pattern.
DOGE/USDT
After staying above the 50-day SMA ($0.08) for several days, Dogecoin (DOGE) slipped below the level on Feb. 23. This indicates a minor advantage to the bears.
The DOGE/USDT pair could drop to the strong…
cointelegraph.com