Stock markets in Europe and the United States are in the red as traders continue to sell off risky assets amid escalating geopolitical conditions. Bitcoin (BTC) and several major cryptocurrencies are also seeing profit-taking after a recent rally.
Another reason investors may be interested is the upcoming March 16 Federal Open Market Committee (FOMC) meeting. A March 2 statement by Fed Chair Jerome Powell made it clear that the central bank is likely to hike rates this month.
Brian Coulton, chief economist at Fitch Ratings expected Core inflation will remain elevated in 2022 and the Fed will “hit interest rates to 3% by the end of 2022.”
ExoAlpha Managing Partner and Chief Investment Officer David Lifchitz to speak Bitcoin could remain soft in the short-term as a Fed rate hike strengthens the dollar, thus “weakening” bitcoin. However, he does not expect any drastic impact on Bitcoin.
A number of uncertain factors could hamper near-term bullish momentum. Let’s analyze the charts of the top 10 cryptocurrencies to identify key support and resistance levels.
Bitcoin fell from $45,400 on March 2nd, showing the bears defending the overhead resistance at $45,821. The price has fallen to the moving averages, which is a key support to watch out for.
BTC/USDT daily chart | Source: TradingView
If the price recovers from the moving averages, it shows that the bulls are buying on the downside. They will then attempt to push the price above the overhead resistance area at $45,821 and the ascending channel resistance line. If they succeed, the BTC/USDT pair can surge to the next major resistance at $52.088.
Contrary to this assumption, if the price breaks below the moving averages, it shows that traders are selling at higher levels. That could open the door for a drop to $37,000 and then the channel support line.
The 20-day flat EMA ($40,899) and the Relative Strength Index (RSI) near the midpoint are suggesting range-bound action for a few days.
Ether (ETH) broke out and closed above the 50-day SMA ($2.838) on Feb. 28, but the bears successfully defended the psychological level at $3,000. This may have prompted short-term traders to sell and dragged the price below the moving averages.
ETH/USDT daily chart | Source: TradingView
The ETH/USDT pair can now drop to the symmetrical triangle support line. This is a key support for the bulls to defend because if this level breaks, selling will increase. If the price sustains below the triangle, the downtrend can resume. After that, the pair can drop to $2,300 where the bulls are likely to provide support.
Additionally, if the price points up from the support line, the bulls will attempt to push the pair above the overhead resistance at $3,000 and challenge the triangle resistance line.
Although the bulls pushed BNB above the 50-day SMA ($403), they failed to sustain the higher levels. This shows that the bears are defending this level with all their might.
Daily BNB/USDT Chart | Source: TradingView
The sellers are trying to sink and sustain the price below the 20-day EMA ($391). If so, the BNB/USDT pair can drop to the strong support at $350.
Additionally, if the price recovers from current levels, the likelihood of a breakout and close above the 50-day SMA increases. That could open the door for a rally to the overhead resistance of $445.
The 20-day flat EMA and the RSI near the midpoint are suggesting a range-bound move in the near-term.
Ripple (XRP) was rejected by the downtrend line and fell to the 50-day SMA ($0.73). This shows that the bears are still selling heavily at higher levels.
XRP/USDT daily chart | Source: TradingView
If the price recovers from the 50-day SMA, buyers will once again attempt to push and sustain the XRP/USDT pair above the downtrend line. If they succeed, buying momentum could increase and the pair could climb to $0.91.
On the other hand, if the price sustains below the 50-day SMA, the bears will attempt to drag the pair to $0.62. The flat moving averages and the RSI near the middle do not give the bulls or bears a clear advantage.
Terra (LUNA) failed to sustain above $94 but the positive sign is that buyers have not given up much land. The bulls have been buying continuously as the price has fallen to $86 over the past three days.
Daily LUNA/USDT Chart | Source: TradingView
Usually, a tight consolidation near overhead resistance is a sign of strength. If the bulls push and sustain the price above $94, the LUNA/USDT pair can challenge the all-time high of $103.
A breakout and close above this level would indicate a continuation of the uptrend. The pair can then rally to $110. The rising 20-day EMA ($72) and the RSI near the overbought zone are suggesting an advantage for the buyers.
This bullish view will be invalidated in the short-term if the price turns down and falls below $86, which can pull the price to $80.
Solana (SOL) surged above the descending channel’s resistance line on March 2, but the bulls failed to clear the hurdle at the 50-day SMA ($103). Failure to do so can tempt short-term traders to take profits. This pulled the price back into the channel.
Daily SOL/USDT chart | Source: TradingView
If the bears drag and sustain the price below the 20-day EMA ($95), the SOL/USDT pair can drop to the strong support at $81. This is an important level to watch as the bulls have successfully defended it for the past few days.
If the price recovers from $81, the pair can rally to the 50-day SMA and then oscillate between the two levels for a few days.
A breakout and close above the 50-day SMA would be the first sign that the downtrend might be over. After that, the pair can rally to $122. Alternatively, if the bears pull and sustain the pair below $81, the decline can extend to $66.
During a strong downtrend, when strong supports are broken, they often turn into resistance and this is what happened with Cardano (ADA). The recovery rally stalled on a breakout of $1, which shows the bears are defending this level.
Daily ADA/USDT Chart | Source: TradingView
The bears will now attempt to sink the price below the next support at $0.82 and challenge the February 24th low of $0.74. If this level is also broken, the ADA/USDT pair can extend its downtrend to $0.68.
Contrary to this assumption, if the price recovers from $0.82, the bulls will make another attempt to clear the $1 barrier, which will be the first sign that the sellers are losing ground. The bulls need to push and hold the pair above the channel to indicate a trend reversal.
Avalanche (AVAX) was rejected by the descending trendline of the descending channel for the fourth time. This shows that traders are selling on rallies at this level.
AVAX/USDT daily chart | Source: TradingView
The bears are attempting to keep the price below the moving averages, while the bulls are buying the dip and attempting to sustain the AVAX/USDT pair above the 20-day EMA ($80). The flat 20-day EMA and the RSI near the middle are suggesting an equilibrium between supply and demand.
If the bulls propel the price above the 20-day EMA, the pair can rally back to the downtrend line. The bulls need to clear this barrier to signal a trend reversal. Alternatively, if the price falls below $71, the pair can fall to $64.
Polkadot (DOT)’s failure to move above the 50-day SMA ($19) shows that sentiment remains bearish and traders are selling while it recovers to stiff resistance levels.
DOT/USDT daily chart | Source: TradingView
The bears have pulled the price below the 20-day EMA ($18) and will now attempt to test the strong support at $16-$14. This zone has successfully held on the last two occasions, so the bulls will once again attempt to defend it aggressively.
If the price recovers from the zone, the DOT/USDT pair can rally to the moving averages. A breakout and close above the 50-day SMA would be the first sign that the downtrend might be over.
Conversely, a break and close below the zone will result in the price resuming the downtrend. After that, the pair can drop to the psychological support at $10.
Dogecoin (DOGE)’s recovery rally has stalled at the 20-day EMA ($0.13), showing that the bears are not ready to give up their advantage. The bears are attempting to drag the price to the strong support at $0.12.
Daily DOGE/USDT chart | Source: TradingView
Repeated retests of support tend to weaken it and it shows that bulls are unable to sustain higher levels. If the price breaks out and sustains below $0.12, the DOGE/USDT pair can drop to the psychological $0.10 level.
The moving averages are sloping down and the RSI is in the negative territory, suggesting that the path of least resistance is down. This negative view will be invalidated in the short-term if the bulls push and sustain the pair above the 50-day SMA ($0.14).
You can see the coin prices here.
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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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