Bitcoin (BTC) and most major altcoins continued to experience a bloodbath on Jan. 21, and the result of the recent downturn was a $200 billion drop in market cap.
one report A new report by Huobi Research in collaboration with the Singapore Blockchain Association predicts that Bitcoin will enter a bear market in 2022.Liquidity-tightening measures by the US Federal Reserve and other central banks around the world, as well as regulatory actions by authorities, may be the main reason.
The bear market exclamations haven’t shaken the resolve of MicroStrategy CEO Michael Saylor, who is determined to hold on to the company’s bitcoin. Saylor said in a recent interview with Bloomberg that the company’s strategy is to buy and hold Bitcoin, not sell it.
Can Bitcoin and Most Major Altcoins Rally From Their Strong Support Levels? Let’s study the charts of the top 10 cryptocurrencies to find out.
Bitcoin attempted a rebound on Jan. 20 when bulls pushed the price down to the 20-day EMA ($43,041). However, the bears have other plans as they sell on this rally and push the price lower as shown by the long wick on the intraday bar.
The selling continued on Jan. 21 and the BTC/USDT pair broke below the strong support at $39,600. There is minor support at $37,332.7. The bulls are likely to defend this support with all their might.
Oversold levels on the Relative Strength Index (RSI) are also signaling a possible consolidation or recovery. If the next rally can help the price scale above the 50-day SMA, it indicates that the downtrend may be over.
Conversely, if the price breaks below the support zone, the downside could increase and the pair could drop to $30,000.
The long wick on the Ether (ETH) bar from Jan. 20 shows that the trend remains negative and traders are selling on relief rallies to strong resistance levels.
ETH/USDT daily chart | Source: TradingView
Selling resumed on Jan 21 and the bears dragged the price below the next support at $2,928.83. This opens the door for the possibility of a drop to $2,652 where buyers can defend aggressively.
If the price bounces off $2,652, the bulls will make another attempt to push the ETH/USDT pair above the 20-day EMA and the channel resistance line. If that happens, the pair could signal a trend reversal.
Conversely, if the bears turn down and sustain the price below $2,652, selling may accelerate and the pair may drop to $2,000.
Binance Coin (BNB) was rejected by the 20-day EMA ($474) on Jan. 20, showing the bears are aggressively defending this resistance. The sellers will now attempt to pull the price below the January 10th low of $405.60.
Daily BNB/USDT Chart | Source: TradingView
The moving averages are sloping down and the RSI is in the negative territory, showing an advantage for the bears. If the price stays below $405.60 and the descending channel, selling is likely to increase and the pair can drop to $325.
On the other hand, if the price recovers from $405.60 or the channel support line, the bulls will make another attempt to push the BNB/USDT pair above the 20-day EMA and the channel resistance line. If this is the case, it signals a possible trend reversal.
Cardano (ADA) broke through and closed below the moving averages on Jan. 20. The long wick on the intraday bar shows that the bears continue to sell on the rally.
Daily ADA/USDT Chart | Source: TradingView
If the bears sustain the price below the moving averages, the ADA/USDT pair can drop to the critical $1 support. This is a key support to watch for as it has not been broken on a fundamental basis for the last ten months.
When the price surges from the current levels and breaks above the moving averages, it shows that traders are accumulating on the downside. Buyers need to push and hold the pair above the descending channel to signal a possible trend reversal.
Solana (SOL) formed an outside bar candlestick pattern on Jan 20th. Traders sold heavily from higher levels and dragged the price below the next support at $130.
Daily SOL/USDT chart | Source: TradingView
The SOL/USDT pair has fallen to the strong support at $116. If this level does not provide support, a decline can pull to the descending channel support line. The moving averages are sloping down and the RSI is floating in the oversold territory, suggesting that the path of least resistance is to the downside.
If the price scales up from $116, the bulls will make another attempt to break the hurdle at the 20-day EMA ($146). If they succeed, the pair can rally to the resistance line. A break and close above the channel can signal a trend reversal.
Ripple (XRP) broke and closed below the $0.75 support on Jan. 19. The bulls attempted to reclaim this level on Jan. 20, but the long wick on the candlestick shows that the bears will continue to sell if they recover.
XRP/USDT daily chart | Source: TradingView
The XRP/USDT pair broke below the $0.69 support. If the bears sustain the lower levels, the pair can extend the decline to $0.60. The moving averages are sloping down and the RSI near the oversold zone shows that the sellers are in control.
This negative view will be invalidated if the price turns up from the current levels and breaks above the moving averages. Such a move could indicate accumulation at lower levels. After that, the pair can rise towards $1.
Terra (LUNA) broke yet again from the downtrend line on January 20th, showing that the bears remain aggressively defending this level.
Although the 20-day EMA ($79) is flat, the RSI has dipped below 46, showing that bears have a slight advantage. If the price stays below $73.95, the LUNA/USDT pair can start falling towards the critical support at $62.46.
Contrary to this assumption, if the price recovers from the current levels, the bulls will make another attempt to push the pair above the downtrend line. If they are successful, this indicates that the customization process may have ended. The pair can rally to $93.81.
Polkadot (DOT) has broken below the critical support at $22.66, which is an important level to watch as it has not broken on a closing basis since mid-August last year.
DOT/USDT daily chart | Source: TradingView
If the price recovers from the current levels, the bulls will make another attempt to clear the overhead barrier at the moving averages. A break and close above the 50-day SMA ($27.08) will be the first sign that selling pressures might be easing. The bulls need to push the price above $32.78 and hold it to signal a potential reversal.
On the other hand, if the DOT/USDT pair sustains below $22.66, it will indicate that supply will exceed demand and traders will exit. After that, the pair can drop to the next support at $16.81.
Avalanche (AVAX) turned down near the 20-day EMA ($90) on Jan 20 and broke below the strong support at $75.50 on Jan 21.
AVAX/USDT daily chart | Source: TradingView
The sloping moving averages and the RSI in the negative territory show that the bears are in control. A close below $75.50 will complete a descending triangle pattern and signal that the pair has made a cycle high. After that, the AVAX/USDT pair can drop to $50.
However, the bulls are unlikely to give up without a strong fight. If the price recovers from the current levels, the pair can rally to the 20-day EMA and then to the downtrend line. The bulls need to break through this barrier to signal the end of the correction.
The bulls unsuccessfully attempted to push Dogecoin (DOGE) back above the moving averages on Jan. 20. This shows that sentiment is still negative and that the bears are selling near the resistance levels.
Daily DOGE/USDT chart | Source: TradingView
The DOGE/USDT pair can now descend towards the strong support at $0.13 where buyers can get in to capitalize on the downside move.
If the price recovers from this level and rises above the moving averages, it will indicate that the range-bound action could last for a few more days.
The key levels to watch on the upside are $0.19 and $0.13 on the downside. The next trend might start after the price breaks either level. Until then, the stochastic moves in the range could continue.
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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London, united kingdom, 22nd November 2024, Chainwire
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