Bitcoin (BTC) returned to psychological levels at $ 50,000 and the S&P 500 hit a new all-time high on December 23, suggesting the sell-off is easing due to fear of the omicron variation and the “Santa Claus rally” may have started.
Data from on-chain analytics company Glassnode shows around 100,000 bitcoins move from “liquid” to “illiquid” each month, which means that the coins are sent to addresses with “little transaction history”. This shows the accumulation of investors.
Another sign that investors are not discarding their coins after making minor corrections. Data by CryptoRank shows that the total number of bitcoins on crypto exchanges fell from 9.5% of the total bitcoin supply in October 2020 to 6.3% of the total supply in December this year, the lowest figure in 2021.
Is the current rally the beginning of a new upward trend or is it just a dead hop? Let’s check out the top 10 cryptocurrency charts to find out.
Bitcoin broke out and closed above the 20-day EMA ($ 49,720) on December 23, suggesting sellers are losing control. The flat 20-day EMA and Relative Strength Index (RSI) near the middle suggest that the short-term trend may change.
BTC / USDT daily chart | Source: TradingView
The recovery may reach the 38.2% fib retracement level at $ 52.314 and then the 50% fib retracement level at $ 55.560. The bears are likely to create strong resistance in this zone. If the price deviates downward from this zone, they will try to resume the downtrend.
A break and close below the strong support zone at $ 45,000- $ 42,000 could open the door for a decline to $ 30,000. On the flip side, if buyers push the price above $ 55,560, the BTC / USDT pair may soar to the 61.8% fib retracement level at $ 58,686. A break and close above this level will improve the prospect of retesting the all-time highs.
Ether (ETH) broke out and closed above the descending channel and the 20-day EMA ($ 4,060) on December 23, which is the first sign that the correction may be over.
ETH / USDT Daily Chart | Source: TradingView
If buyers hold the price above the 20-day EMA, the bullish momentum can build up and the ETH / USDT pair can rise to $ 4,488. This level could act as strong resistance again, but if the bulls push the price above it, the pair may retest the all-time high of $ 4,868.
The 20-day EMA is flattening out and the RSI is near the middle, indicating that the bulls are aiming for a return.
However, when the price turns down and returns into the channel, it shows that the current breakout is a bull trap. After that, the pair can drop to $ 3,643.73. Breaking and closing below this support could force a decline towards the 200-day SMA ($ 3,316).
Binance Coin (BNB) has bounced back from the downtrend line, which could act as a rigid resistance. If the price declined from current levels, it would indicate that traders will continue to sell during the recovery.
BNB / USDT daily chart | Source: TradingView
Now the bears will try to push the price into the strong support area at $ 500- $ 489.20. If that zone breaks, the decline can extend to the 200-day SMA ($ 439), likely to join the buyer and provide support.
Contrary to this assumption, this suggests that the correction may be over if the bulls push and hold the price above the downtrend line. Buyers will then attempt to resume the upward momentum and potentially encounter resistance at $ 575 and above at $ 617.
After trading near the 20-day EMA ($ 184) for the past few days, Solana (SOL) broke out on December 23rd and closed above the resistance. The 20-day EMA has flattened and the RSI is near the middle. suggests a balance between supply and demand.
Daily SOL / USDT chart | Source: TradingView
This equilibrium will tend in favor of the bulls if the price holds above the 20-day EMA. Such a move would mean that the short-term correction may be over. After that, SOL / USDT can rise to $ 204.10 and above to $ 240.
Conversely, if the price goes down and falls below $ 168.49, it shows that the bears are continuing to sell up. After that, the pair can drop to $ 148.04. If this level is also broken, the pair could fall to the 200-day SMA ($ 123).
Cardano (ADA) rose above the 20-day EMA ($ 1.37) on December 23, showing that buyers are aiming for return. However, the bears are not giving up anytime soon and will try to push the price back below the 20-day EMA.
Daily ADA / USDT Chart | Source: TradingView
When successful, it shows that sentiment remains negative and traders sell on rallies. After that, the ADA / USDT pair may fall to the strong support at USD 1.18. A break and a close below this level can drop the pair to $ 1.
If the price rebounds from the 20-day EMA, it also shows that sentiment is up and traders are buying on the downside. The bulls will then attempt to push the price down to the $ 1.87 resistance level.
Ripple (XRP) broke out and closed above the 200-day SMA ($ 0.94) on December 22nd, suggesting sellers may be losing control. The bears are currently trying to stave off an upswing near the psychological $ 1 mark.
XRP / USDT daily chart | Source: TradingView
When the bulls do not allow the price to drop below the moving averages again, it shows that traders are buying the dip. This move increases the likelihood of a breakout above 1. When that happens, the XRP / USDT pair can rise to $ 1.20 and higher to $ 1.41.
Contrary to this assumption, if price falls below the moving averages, it shows that traders could sell near the overhead resistance and hold the pair trapped in a wide range of $ 0.75 to $ 1.
Terra (LUNA) went down from $ 98.20 on December 22nd, showing that the bears are defending psychological resistance at $ 100, but the bulls have other plans as they buy the dip and prices on December 23rd let rise again.
Daily LUNA / USDT chart | Source: TradingView
The rising 20-day EMA ($ 74) and the RSI in the overbought territory suggest that the advantage is in the hands of buyers. If the bulls keep the price above USD 100, the LUNA / USDT pair could enter the next phase of the uptrend. The next upside target is $ 124.65 and above $ 150.
Also, if the price drops from current levels, it means that the bears at $ 100 will continue to be a major challenge. Sales are likely to pick up if the price drops below the 20-day EMA. After that, the pair can drop to $ 50.
Avalanche (AVAX) is facing an area of resistance created by the 61.8% – 78.6% Fib retracement level at $ 119.69 – $ 131.70, but one small positive is that the bulls are failed to give up much land.
AVAX / USDT daily chart | Source: TradingView
The 20-day EMA is rising ($ 107) and the RSI is in positive territory, suggesting that the path of least resistance is up. If the bulls push the price above $ 131.70, the AVAX / USDT pair may retest the all-time high of $ 147.
Conversely, if the price turns down from current levels or the overhead resistance and falls below the 20-day EMA, demand will dry up at higher levels. After that, the pair can drop to $ 98.14. If this level is broken, the next stop could be at $ 75.50.
Polkadot (DOT) rebounded from strong support at $ 25- $ 22.66 on December 20th and the bulls pushed the price above the moving averages on December 23rd.
DOT / USDT daily chart | Source: TradingView
If buyers hold the price above the moving averages, the DOT / USDT pair can rise to $ 31.49 where the bears can create tough resistance.
If the price moves down from this level but rebounds from the moving averages, it would indicate a shift in sentiment from selling up to buying down. That could open the door to a rally to $ 39.35.
This positive view will be invalid if the price deviates from current levels and falls below the 20-day EMA ($ 28.42). That could pull the pair into the support zone.
The Dogecoin (DOGE) rally from the strong support at $ 0.15 has hit the 20-day EMA ($ 0.18). This shows that the bears may be losing their grip.
Daily DOGE / USDT Chart | Source: TradingView
Buyers will now attempt to push the price above the $ 0.19 resistance level. If this succeeds, the DOGE / USDT pair can rise to $ 0.22 and above the 200-day SMA ($ 0.23). The bears will likely defend this zone heavily.
On the other hand, if the price goes down from $ 0.19, the pair may fall back to $ 0.15 and stay in the range between the two for a few more days. The bears will need to move lower and hold the price below $ 0.15 to enter the next phase of the downtrend.
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Disclaimer: This article is for informational purposes only, not investment advice. Investors should research carefully before making a decision. We are not responsible for your investment decisions.
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