The United States consumer price index (CPI) increased 8.2% annually in September, beating economists’ expectations of an 8.1% rise. The CPI print liv
The United States consumer price index (CPI) increased 8.2% annually in September, beating economists’ expectations of an 8.1% rise. The CPI print lived up to its hype and caused a sharp, but short-term increase in volatile risk assets.
The S&P 500 oscillated inside its widest trading range since 2020 and Bitcoin (BTC) also witnessed a large intraday range of more than $1,323 on Oct. 13. However, Bitcoin still could not shake out of the $18,125 to $20,500 range it has been stuck in for the past several days.
Both the U.S. equities markets and Bitcoin tried to extend their recovery on Oct. 14 but the higher levels attracted selling, indicating that the bears have not yet given up.
Could the increased volatility culminate with a breakout to the upside or will it start the next leg of the downtrend?
Let’s study the charts of the S&P 500 index, the U.S. dollar index (DXY) and the major cryptocurrencies to find out.
SPX
The S&P 500 index (SPX) gapped down on Oct. 13 and dropped to 3,491 but lower levels attracted huge buying by the bulls. That may have caught several aggressive bears on the wrong paw and they might have scrambled to cover their short positions. That propelled the index back above the breakdown level of 3,636.
Buyers tried to extend the recovery on Oct. 14, but the bears had other plans. The sellers vigorously defended the 20-day exponential moving average (EMA) (3,715), indicating that the sentiment remains negative and relief rallies are being sold into.
The bears will try to sink the index to 3,491 which is an important level to keep an eye on. If this support cracks, the index could dive to 3,325.
Alternatively, if the index rebounds off the support zone between 3,636 and 3,491, it will suggest that bulls may be accumulating on dips. Buyers will then attempt to overcome the barrier at the 20-day EMA and challenge the downtrend line. If this resistance collapses, it will signal that the corrective phase may be over.
DXY
The U.S. dollar index turned down from 113.92 on Oct. 13 but the bulls arrested the decline at the 20-day EMA (112). This suggests that the sentiment remains positive and traders are viewing the dips as a buying opportunity.
The bulls will try to pierce the overhead resistance zone between $113.92 and $114.77. An acceptance above this zone will signal the resumption of the uptrend. The index could then rally to $117.14.
Contrary to this assumption, if the price turns down from the overhead resistance, the bears will try to pull the index below the 20-day EMA. A break below this support will be the first indication that the bullish momentum is weakening.
The index could then decline to the 50-day simple moving average (SMA) (109). A trend change will be signaled if bears sink the price below the uptrend line.
BTC/USDT
Bitcoin sliced through the support at $18,843 on Oct. 13 and dipped close to $18,125. This level attracted buying which started a sharp recovery as seen from the long tail on the day’s candlestick.
Buyers pushed the price above the moving averages on Oct. 14 but the up-move is facing stiff resistance at the downtrend line. The 20-day EMA ($19,466) is flattening out and the relative strength index (RSI) is near the midpoint, indicating equilibrium between buyers and sellers.
This balance will tilt in favor of the bulls if they push and sustain the price above the overhead resistance at $20,500. The BTC/USDT pair could then rally to $22,800. The bears are expected to mount a stiff resistance at this level.
If the price sustains below the 20-day EMA, the bears will again try to pull the pair below $18,843 and challenge the support at $18,125.
ETH/USDT
Ether (ETH) broke below the support at $1,220 on Oct. 13 but the bears could not keep the price down. The bulls vigorously purchased the dip, forming a hammer candlestick pattern.
Buyers have sustained the positive momentum on Oct. 14 and are trying to push the price above the overhead zone between the 20-day EMA ($1,331) and the resistance line of the triangle.
If they can pull it off, the ETH/USDT pair could attempt a rally to the downtrend line of the descending channel pattern. The bulls will have to clear this obstacle to signal a potential trend change.
The bears are likely to have other plans. They will attempt to halt the recovery in the overhead zone and then try to pull the pair below $1,190.
BNB/USDT
BNB has been range-bound between $300 and $258 for the past several days. In a range, traders usually buy near the support and sell close to the resistance.
That is what happened on Oct. 13 as the bulls purchased the dip to $258. Buyers tried to push the price above the moving averages on Oct. 14 but the long wick on the candlestick shows that bears are selling near…
cointelegraph.com