Bitcoin price is targeting $25,000 and holding this level could trigger breakouts in ADA, UNI, LINK and CHZ.
Bitcoin price is targeting $25,000 and holding this level could trigger breakouts in ADA, UNI, LINK and CHZ.
The S&P 500 rose for the fourth successive week as investors cheered on signs that inflation may have peaked. Bitcoin (BTC) and select altcoins also extended their recovery, suggesting that investors are increasing their exposure to risk assets.
A similar trend has played out in the cryptocurrency markets. Altcoins, led by Ether (ETH), have outperformed Bitcoin after clarity on Ethereum’s Merge, according to analysts at Glassnode.
However, trading firm QCP Capital is cautious about the momentum in the altcoin market. They highlighted that the open interest on Ether options had surged to $8 billion, exceeding Bitcoin option OI which was at $5 billion. Glassnode suggested that traders have been booking profits on the spread between their spot long Ether versus the quarterly short Ether futures positions.
Could Bitcoin and the altcoins extend their recovery in the next few days? Let’s study the charts of the top-5 cryptocurrencies that may outperform in the near term.
BTC/USDT
Bitcoin rose above the overhead resistance of $24,668 on Aug. 13 and Aug. 14 but the bulls could not sustain the higher levels. This indicates that bears are selling on rallies but repeated breach of an overhead resistance tends to weaken it.
The gradually upsloping 20-day exponential moving average ($23,414) and the relative strength index (RSI) in the positive territory indicate that the path of least resistance is to the upside. If bulls sustain the price above $25,000, the momentum could pick up further and the BTC/USDT pair could rally to $28,000.
This level may act as a stiff resistance but if bulls clear this hurdle, the rally could extend to $32,000. The critical level to watch on the downside is the 20-day EMA. A bounce off it will indicate that the sentiment remains positive and traders are buying on dips.
On the contrary, if the price turns down from the current level and breaks below the 20-day EMA, it will suggest that bears remain active at higher levels. The pair could then drop to the 50-day simple moving average ($21,976).
The $24,668 level is witnessing a tough battle between the bulls and the bears. The upsloping moving averages indicate advantage to buyers but the negative divergence on the RSI suggests the momentum may be weakening.
If the price breaks below the 20-EMA, it will signal a minor advantage to the bears. The pair could then decline to the 50-SMA and later to $23,600. Alternatively, if the price turns up from the 20-EMA and rises above $25,050, the up-move may resume.
ADA/USDT
Cardano (ADA) broke and closed above the overhead resistance at $0.55 on Aug. 13. This indicates that the uncertainty has resolved in favor of the bulls.
The rising 20-day EMA ($0.52) and the RSI in the positive territory indicate that bulls have the upper hand. The ADA/USDT pair could rally to $0.63 and then to the strong overhead resistance at $0.70. This level is likely to attract strong selling by the bears.
Contrary to this assumption, if the price turns down from the current level and breaks below the 20-day EMA, it will suggest that the break above $0.55 may have been a bull trap. The pair could then decline to the 50-day SMA ($0.49) and later to $0.45.
The pair completed an ascending triangle pattern on a break and close above the overhead resistance at $0.55. This pushed the RSI on the 4-hour chart to overbought levels, which may have tempted short-term traders to book profits.
The price may drop to the breakout level of $0.55. If bulls flip this level into support, the pair may continue its up-move to the pattern target at $0.65. This positive view could invalidate in the near term if the price plummets below the uptrend line.
UNI/USDT
Uniswap (UNI) has been consolidating between $8.11 and $9.83 for the past few days. This suggests that the bulls are buying the dips but the bears are defending the overhead resistance.
The longer the price remains in the range, the stronger will be the breakout from it. The 20-day EMA ($8.54) is sloping up and the RSI is in the positive territory, indicating advantage to buyers. If bulls thrust the price above $9.83, the UNI/USDT pair could pick up momentum and rally toward $10.55 and later to $12.
Alternatively, if the price turns down from the current level and breaks below the 20-day EMA, it will suggest that the pair may continue its range-bound action for some more time. The bears will have to sink and sustain the price below $8.11 to gain the upper hand.
The 4-hour chart shows that the bears are defending the zone between $9.50 and…
cointelegraph.com