Bitcoin is showing renewed strength and targeting yearly highs. Will altcoins follow suit?
Bitcoin is showing renewed strength and targeting yearly highs. Will altcoins follow suit?
October is proving to be a solid month for Bitcoin (BTC) as the price is nearing the 2023 high at $31,805. Generally, major resistances are not cleared in the first instance as the bears come out in full force to guard the level. Therefore, a minor dip is to be expected, but that should not be considered as the start of a negative sentiment.
Buyers regroup at lower levels and try to form a higher floor. That triggers further buying and starts a rally. This is a possibility in Bitcoin but risks remain. While the cooling of the United States dollar index (DXY) is a positive sign, the weakness in the S&P 500 Index (SPX) is a negative sign.
Another risk to the rising cryptocurrency markets could come from the surging 10-year Treasury yield which once again rose above 5%. The rise in the yields show that the market participants are losing hope that the Federal Reserve will cut rates in the near future.
Could the frustration from the U.S. equities markets drive investors to the cryptocurrency markets? Will Bitcoin decouple from the S&P 500 Index and extend its up-move? Let’s analyze the charts to find out.
S&P 500 Index price analysis
The bears successfully held the retest of the neckline of the head and shoulders pattern in the S&P 500 Index. The failure to shove the price above the 50-day simple moving average (4,382) attracted aggressive selling by the bears.
The index dropped below the crucial support at 4,216 on Oct. 23 but the bulls are trying to halt the decline. Any recovery attempt is likely to face strong selling at the 20-day exponential moving average (4,317) and then at the 50-day SMA. The bulls will have to thrust the price above 4,400 to signal that the correction may be over.
If the price turns down and maintains below 4,216, the selling may accelerate further and the index could nosedive toward the pattern target of 4,088.
U.S. dollar index price analysis
The U.S. dollar index is witnessing a tough battle between the bulls and the bears. The bulls tried to push the price toward the local high of 107.35 but the bears held their ground.
Sellers are attempting to sustain the price below the breakout level of 106. If they manage to do that, the index may witness profit booking and tumble to the 50-day SMA ($105) and then to 104.50. This zone is likely to witness solid buying by the bulls.
If the price rebounds off this zone, the bulls will again try to propel the index above 107.35. If they can pull it off, the index may surge to 108 and eventually to 111.
On the contrary, if the price slides below 104.50, it will indicate that the bears are back in the game. The index may then slump to 103.
Bitcoin price analysis
After struggling to sustain above $30,000 for the past three days, the bulls made a decisive move on Oct. 23 and pushed the price to $31,000.
The sharp rally of the past few days has pushed the relative strength index (RSI) into the overbought territory, indicating that a consolidation or correction is possible in the short term. On the way down, if bulls do not allow the price to slip below $30,000, it will suggest that every minor dip is being purchased. The bulls will then make one more attempt to clear the hurdle at $31,000.
If they succeed, the BTC/USDT pair could rally to $32,400. The bears are expected to defend this level with all their might because if the $32,400 resistance is cleared, the pair may soar to $40,000.
Contrarily, if the price turns down sharply and breaks below $30,000, it will suggest that traders are booking profits. That may sink the price to the 20-day EMA ($28,428).
Ether price analysis
Ether (ETH) broke above the moving averages on Oct. 21, indicating that the bulls continue to buy the dips to the strong support at $1,531.
The 20-day EMA ($1,608) has started to turn up and the RSI is in the positive zone, indicating that the bears may be losing their grip. The ETH/USDT pair could rise to $1,746 where the bears will try to stall the up-move.
If bulls do not give up much ground from this level, the likelihood of a rally above $1,746 increases. The pair could then move up to $1,880. Instead, if the price turns down sharply from $1,746, it will indicate that the range-bound action may continue for a few more days.
BNB price analysis
BNB (BNB) broke and closed above the downtrend line on Oct. 22, invalidating the bearish descending triangle pattern. The failure of a bearish setup is a bullish sign.
The BNB/USDT pair has reached the horizontal resistance at $223. If this obstacle is overcome, the pair could rally to $243 and thereafter to $250. The bears are expected to guard this…
cointelegraph.com
COMMENTS