The banking crisis in the U.S. has led to aggressive buying in Bitcoin and select altcoins, which are nearin
The banking crisis in the U.S. has led to aggressive buying in Bitcoin and select altcoins, which are nearing stiff overhead resistance levels.
Three banks, Silvergate, Silicon Valley Bank and Signature collapsed within a span of a few days. That increased demand for United States government bonds, which sent the yield on the 2-year Treasury tumbling to 4.06%, a fall of 100 basis points since March 8.
This was the largest 3-day decline since Oct. 22, 1987, following the stock market crash, when the yield fell 117 points.
Although the Federal Reserve announced the formation of a $25 billion Bank Term Funding Program to support businesses and households, the regional banks are taking it on their chin on March 13. This shows that equities traders remain nervous.
However, among all the mayhem, it is an encouraging sign to see Bitcoin (BTC) lead the cryptocurrency recovery from the front. Bitcoin climbed back above $24,000 on March 13, covering a large distance from the $19,549 local low hit on March 10.
Could Bitcoin and the major altcoins sustain their short-term bullish momentum? Let’s study the charts to find out.
SPX
The S&P 500 index (SPX) plunged below the 200-day simple moving average (3,940) on March 9 and followed that up with another downward move on March 10.
A break below the 200-day SMA is a bearish sign but if the price quickly turns up and climbs back above the level, it will suggest that the breakdown on March 9 may have been a bear trap.
The index could gain momentum after buyers thrust the price above the 20-day exponential moving average (3,986). There is a minor resistance at 4,078 but it is likely to be crossed. The index may then soar to 4,200.
On the downside, a break and close below 3,764 will suggest that the traders are rushing to the exit. That next support is at 3,700 and then 3,650.
DXY
The recovery in the U.S. dollar index (DXY) stalled just below the 200-day SMA (106). This suggests that the bears are trying to flip the level into resistance. The selling has pulled the price below the 20-day EMA (104) on March 13.
The flattening 20-day EMA and the relative strength index (RSI) just below the midpoint indicate a balance between supply and demand. This could keep the index range-bound between 101 and the 200-day SMA for some time.
If the price turns down and plummets below the support near 101, the index will complete a head and shoulders (H&S) pattern. This bearish setup could start the next leg of the downtrend.
Conversely, a break above the 200-day SMA will attract buyers who may then push the price to 108 and thereafter to 110.
BTC/USDT
Bitcoin price rebounded off the 200-day SMA ($19,717) on March 10 and the recovery picked up momentum after the break above $21,480. This suggests that lower levels are attracting buyers.
The bulls continued the upward march and cleared the hurdle at $22,800 on March 13. This opens the gates for a retest of the stiff overhead resistance at $25,250. If buyers overcome this barrier, the BTC/USDT pair could witness aggressive short covering. That may catapult the price to $30,000.
Contrarily, if the price turns down from the overhead resistance, the pair may oscillate between the 200-day SMA and $25,250 for a while longer. Such a move will be a positive sign and improve the prospects of a break above the overhead resistance. This positive view could invalidate if the price turns down and plunges below the 200-day SMA.
ETH/USDT
Ether (ETH) rebounded off the support near $1,352, indicating aggressive buying at lower levels. The recovery strengthened after bulls pushed the price back above $1,461.
The ETH/USDT pair rose back above the 20-day EMA ($1,565) on March 12, indicating that bulls are back in the game. Buyers will next try to stretch the relief rally to the overhead resistance at $1,743.
The flattening 20-day EMA and the RSI in the positive territory suggest that the momentum favors the bulls. If buyers surmount the resistance at $1,743, the pair could soar to the psychological level at $2,000.
BNB/USDT
BNB (BNB) completed a bearish H&S pattern on March 9 but the sellers could not build upon this negative setup. Buyers purchased the drop on March 10 as seen from the long tail on the day’s candlestick.
The buying continued on March 12 and the bulls pushed the price back above the 200-day SMA. This may have trapped the aggressive bears who rushed to close their short positions.
That could be the reason for the sharp up-move on March 13, which propelled the price back to the overhead resistance at $318. If bulls clear this hurdle, the BNB/USDT pair may rise to $338.
If the price turns down from this level, the pair may consolidate between $338 and $265…
cointelegraph.com