After trading near the $20,000 level for several days, Bitcoin (BTC) turned down sharply and dropped below $19,000 on Sept. 6. The fall was not limite
After trading near the $20,000 level for several days, Bitcoin (BTC) turned down sharply and dropped below $19,000 on Sept. 6. The fall was not limited to the cryptocurrency markets as the United States equities markets also closed lower on Sept. 6.
Risky assets have been facing selling pressure in the past few days as investors are worried that the Federal Reserve could continue with its aggressive tightening policy.
The CME FedWatch Tool shows that the probability for a 75 basis point rate hike in the September meeting has risen to 80% from 69% a week back. This extended the rise in the U.S. dollar index (DXY), which closed above 110 on Sept. 6.
The U.S. equities markets and the cryptocurrency markets are attempting a relief rally on Sept. 7 but the recovery is likely to sustain only after the DXY shows signs of topping out.
Although the bear market has been brutal, it is an encouraging sign to see that venture capital firms have continued to plow money into cryptocurrency and blockchain companies. According to a KPMG report released on Sept. 6, the total investments in the first half of 2022 by these firms hit $14.2 billion, which comes after the record $32.1 billion investments made in 2021.
What are the critical overhead resistances in Bitcoin and altcoins that need to be crossed for the bullish momentum to pick up? Let’s study the charts of the top-10 cryptocurrencies to find out.
BTC/USDT
Bitcoin’s tight range trading between $19,520 and $20,576 resolved to the downside on Sept. 6. The bears pulled the price to the strong support zone between $18,910 and $18,626.
If the price rebounds off the zone, the BTC/USDT pair could rally to the breakdown level of $19,520. The bears will attempt to flip this level into resistance. If they manage to do that, the likelihood of a break below the support zone increases.
That could sink the pair to the vital support at $17,622. A break and close below this level could signal the resumption of the downtrend. The downsloping 20-day exponential moving average ($20,427) and the relative strength index (RSI) near the oversold territory indicate that bears are in control.
The first sign of strength will be a break and close above the 20-day EMA. Such a move will indicate that bulls are attempting a comeback.
ETH/USDT
Ether (ETH) rose above the moving averages on Sept. 6 but the bulls could not clear the overhead hurdle at $1,700. The bears sold aggressively and pulled the price back below the 20-day EMA ($1,597).
The bears will try to build upon the advantage and sink the price below the neckline of the head and shoulders (H&S) pattern. If they succeed, the ETH/USDT pair could drop to $1,422 and then to the important support at $1,280. The pattern target of this bearish setup is $1,050.
Alternatively, if the price bounces off the neckline, it will suggest that bulls continue to view dips as a buying opportunity. The pair could then consolidate between the neckline and $1,700 for some time. A break and close above $1,700 could clear the path for a possible rally to $2,030.
BNB/USDT
Binance Coin (BNB) turned down sharply from the 20-day EMA ($282) on Sept. 6 and broke below the critical support at $275. This completed a bearish H&S pattern.
Generally, after the breakdown from a major support, the price returns to retest the level. In this case, buyers will try to push the price back above $275. If they manage to do that, several aggressive bears may get trapped. That could result in a short squeeze and the BNB/USDT pair could rally to $308.
On the other hand, if the price turns down from $275, it will suggest that bears have flipped the level into resistance. That could start a decline to $240 and if this support also gives way, the next stop could be the pattern target at $212.
XRP/USDT
The bulls pushed XRP above the overhead resistance at $0.34 on Sept. 6 but the bears trapped the aggressive buyers and pulled the price below the immediate support at $0.32.
A minor positive is that the bulls have not allowed the price to sustain below $0.32. The long tail on the Sept. 7 candlestick shows buying at lower levels. If the price sustains above $0.32, the XRP/USDT pair could extend its range-bound action for some more time.
Contrary to this assumption, if the price turns down from the current level and sustains below $0.32, it will clear the path for a possible decline to $0.30. The bulls are likely to defend this level with all their might.
ADA/USDT
Cardano (ADA) closed above the 50-day simple moving average (0.49) on Sept. 4 and the bulls defended the level on Sept. 5. Buyers tried to extend the relief rally on Sept. 6 but met with a wall of selling near $0.51.
The price turned down sharply and broke below the moving averages….
cointelegraph.com