Bitcoin and select altcoins slipped below their immediate support levels, opening the door for further downs
Bitcoin and select altcoins slipped below their immediate support levels, opening the door for further downside.
Bitcoin (BTC) and most major altcoins have started the new week on a soft note and the Crypto Fear and Greed Index has dropped into the “extreme fear” zone, suggesting that investors are still nervous.
Bitcoin has declined about 17% year-to-date while the Nasdaq 100 has dropped about 16% during the same period, indicating a tight correlation between the two. In comparison, gold has risen more than 10% in 2022 and its 50-day correlation coefficient with Bitcoin “is around minus 0.4, the lowest since 2018,” according to journalist Colin Wu.
Although the crypto price action has remained bearish, the declining balance of Bitcoin on the crypto exchanges indicates that long-term investors are unperturbed and continue to accumulate at every available opportunity. Data from on-chain analytics firm CryptoQuant suggests that the Bitcoin balance of 21 major exchanges dropped to its lowest level since July 2018 at 2.274 million Bitcoin as of April 17.
Could buying emerge at lower levels or will bears build upon their advantage and sink prices lower? Let’s study the charts of the top-10 cryptocurrencies to find out.
BTC/USDT
Bitcoin has been trading inside an ascending channel pattern for the past several days. The bulls defended the psychological level at $40,000 for the past few days but could not achieve a strong rebound off it. This suggests that demand dries up at higher levels.
The bears pulled the price below the immediate support at $39,200 today but the long tail on the candlestick indicates bulls are buying at lower levels.
If the price rises back above $40,000, the bulls will make one more attempt to clear the 50-day simple moving average ($42,167). If they succeed, the pair could rise to $43,900 and later attempt a rally to the 200-day SMA ($48,109).
Conversely, if the recovery falters at $40,000, it will suggest that bears have flipped this level into resistance. That will enhance the prospects of a drop to the support line of the channel. The bulls are expected to defend this level with all their might because a break below it could open the doors for a possible drop to $32,917.
ETH/USDT
Ether’s (ETH) tight range trading between the 20-day exponential moving average ($3,103) and the 50-day SMA ($2,991) resolved to the downside today. The bulls have pulled the price below the immediate support at $2,950.
The downsloping 20-day EMA and the relative strength index (RSI) below 40 indicate that bears are in control. If the price sustains below the 50-day SMA, the ETH/USDT pair could slide to $2,817 and then to the uptrend line.
Contrary to this assumption, if the price turns up and rises above the 50-day SMA, it will suggest that the bulls are attempting to trap the aggressive bears. A break and close above $3,150 could suggest that the correction may be over.
BNB/USDT
Binance Coin (BNB) turned down from the 20-day EMA ($417) and broke below the 50-day SMA ($407) today but the long tail on the daily candlestick suggests buying at lower levels.
The bulls will attempt to trap the aggressive bears and push the BNB/USDT pair above the zone between the 20-day EMA and $427. If they manage to do that, the pair could start its northward march toward $445.
Conversely, if the price turns down from the current level or the 20-day EMA, it will suggest that bears are active at higher levels. The sellers will then try to sink the price below $391 and challenge the strong support at $350.
XRP/USDT
The failure of the bulls to sustain Ripple (XRP) above the 50-day SMA ($0.78) on April 16 could have attracted selling by traders who may have purchased at lower levels. The price turned down and broke below the 20-day EMA ($0.76) on April 17.
If the price sustains below the 20-day EMA, the bears will attempt to sink the XRP/USDT pair to the strong support at $0.69. This is an important level for the bulls to defend because if it cracks, the selling could intensify and the pair may drop to $0.60.
The 20-day EMA has started to turn down and the RSI is in the negative territory, suggesting that bears have a slight advantage. This negative view will invalidate if the price turns up from the current level and breaks above $0.80. That could clear the path for a move to $0.85.
SOL/USDT
Solana (SOL) attempted to rise above the 20-day EMA ($106) on April 17 but the long wick on the day’s candlestick suggests that bears are selling on rallies to this level. The selling picked up momentum today and the bears have pulled the price below the 50-day SMA ($100).
The downsloping 20-day EMA and the RSI in the negative…
cointelegraph.com