The strength in the S&P 500 and weakness in the U.S. Dollar Index could limit the short-term downside in
The strength in the S&P 500 and weakness in the U.S. Dollar Index could limit the short-term downside in Bitcoin and select altcoins.
The S&P 500 Index (SPX) has gained for five consecutive weeks, the first such instance since November 2021. In comparison, Bitcoin (BTC) is trading well below its local high of $31,000, made on April 14. This shows a clear divergence between the performance of the two asset classes.
Some analysts expect Bitcoin’s range-bound action to continue for some more time. Cryptocurrency traders will be looking for some positive triggers that could push the price above the range. One such rumor floating in the markets is that after BlackRock filed for a Bitcoin spot exchange-traded fund, Fidelity Investments may also follow suit. If that happens, it will be a positive sign for the markets.
Another positive for the cryptocurrency markets has been that the U.S. Dollar Index (DXY) softened in the past week. Historically, the dollar and Bitcoin have an inverse correlation, which may help limit the downside in Bitcoin and launch a relief rally.
Let’s look at the important resistance levels that need to be crossed to start a sustained recovery in Bitcoin and the major altcoins.
S&P 500 Index price analysis
The S&P 500 Index is in a short-term uptrend. The rally of the past few days pushed the relative strength index (RSI) into the overbought territory, indicating that a minor correction or consolidation is possible.
The index could turn down and retest the breakout level of 4,325. If the price rebounds off this level, it will suggest that buyers have flipped 4,325 into support. That will enhance the prospects of a rally to 4,500 and thereafter to 4,650.
Contrary to this assumption, if the price turns down and breaks below the 20-day exponential moving average (EMA) of 4,283, it will suggest that the bullish momentum is weakening. That could pull the index to the 50-day simple moving average (SMA) of 4,180. Below this level, the advantage may tilt in favor of the bears.
U.S. Dollar Index price analysis
The failure of the bulls to sustain the U.S. Dollar Index back above the 20-day EMA (103) on June 12 accelerated selling. That pulled the index back below the 50-day SMA (102) on June 15.
The 20-day EMA has started to turn down and the RSI is in negative territory, indicating that bears have the upper hand. Sellers will try to sink the price to the crucial support at 100.82. A break and close below this level will signal the resumption of the downtrend.
Contrarily, if buyers quickly push the price back above the moving averages, it will suggest that the index could rise to the downtrend line. Buyers will have to drive the price above this level to open the gates for a possible rally to 106.
Bitcoin price analysis
Bitcoin has been correcting inside the descending channel pattern for the past several weeks.
The 20-day EMA ($26,389) is flattening out and the RSI has climbed to the midpoint, indicating that the selling pressure could be reducing. Buyers will try to push the price to the resistance line of the channel. This is an important level for the bears to defend because a break and close above it could start a new up move.
Alternatively, if the price turns down sharply from the current level, it will suggest that bears continue to sell on rallies. The BTC/USDT pair could then retest the strong support zone between $25,250 and $24,800.
Ether price analysis
Ether’s (ETH) attempt to start a recovery is facing selling at the 20-day EMA ($1,766), but a minor positive is that the bulls have not allowed the price to slip back below $1,700.
If the price turns up from $1,700, the ETH/USDT pair will again attempt to rally above the 20-day EMA. If that happens, it will suggest that the short-term corrective phase may be over. The pair may first rise to $1,928 and subsequently to $2,000.
Contrarily, if the price turns down from the current level and breaks below $1,700, it will indicate that bears remain in command. There is minor support at $1,600, but if this level gets taken out, the pair may plunge to $1,352.
BNB price analysis
BNB’s (BNB) relief rally is facing selling at the 38.2% Fibonacci retracement level of $252.50, but a positive sign is that the bulls have not given up much ground.
The bulls will again try to thrust the price above the overhead resistance zone between $252.50 and the 20-day EMA ($259). If they can pull it off, the BNB/USDT pair may climb to the 61.8% retracement level of $272.50. The bears are expected to fiercely protect this level.
Contrary to this assumption, if the price turns down from the current level or the overhead resistance, it will suggest that the bears are not…
cointelegraph.com