According to crypto analyst Rakesh Upadhyay, the S&P 500 and Bitcoin (BTC) have bounced from nearby reinforcement levels, showing that the bulls are not giving up and are likely buying the dips. The analyst studies the charts of the main cryptocurrencies, including BTC and DOGE.
An overview of the cryptocurrency market
The US 10-year Treasury yield hit its highest level since 2008. This type of rally is mostly negative for risky assets. However, US stocks rebounded after the Wall Street Journal reported that some Federal Reserve officials were concerned about the speed of rate hikes and the risks of tightening too much.
It is widely accepted that the US will enter a recession. However, there is debate about how long this will take. Koindeks.com Regarding this, Tesla CEO Elon Musk recently said on Twitter that the calm could “probably last until spring 2024”. He also added that ‘it would be nice to have a year without a terrible global event’.
Bitcoin price witnessed a massive drop from its all-time high. However, the hash rate is still strong. According to Bloomberg Intelligence senior commodity strategist Mike McGlone, this puts Bitcoin’s discount from October’s hash rate to its highest level since the first quarter of 2020. The previous example of the big discount was followed by a massive rally that lasted until 2021. McGlone says the same thing will likely repeat itself this time. He also argues that Bitcoin will outperform many major assets. Now it’s time for analysis…
BTC, ETH, BNB and XRP analysis
Bitcoin bounced off its closest reinforcement at $18,843 on October 20. However, the bulls were unable to overcome the drawback at the 20-day EMA ($19,318). This indicates that the bears want to further strengthen their grip.
If the price slides and stays below $18,843, a drop to $18,125 is possible. The bulls will likely defend the zone strongly in the mid-$18,125 to $17,622 zone. Because, if they don’t, BTC is likely to continue its downtrend. The next stop on the downside is $15,750.
The long tail on the October 21 candlestick shows buyers buying the dip below $18,843. They will try to push the price above the moving averages. A break above the 50-day SMA ($19,616) is expected to open the way for a possible rally to $20,500. This is a valuable level to consider. Because, a break above this is likely to indicate the start of a strong recovery to $22,800 followed by $25,211.
ETH is struggling to break above the 20-day EMA ($1,313). However, a small positive is that the bulls did not allow the price to stay below the $1,263 close support.
If the price rises from the current level and rises above the 20-day EMA, a true uptrend to the downtrend line of the descending channel is possible for ETH. Buyers will have to push the price above this resistance to signal the start of a new bullish move. Conversely, if the price continues to decline and slides below the $1,220-1,190 support zone, selling is likely to worsen. Thus, it is possible for ETH to drop to the spiritual level of $1,000 and subsequently to the mainstay of the channel.
Binance Coin (BNB)
BNB is trading below the moving averages while the bears are trying to push the price down to the reinforcement of the range at $258.
The gradually falling 20-day EMA ($274) and the relative strength index (RSI) in the negative zone point to the advantage for the bears. The $258 level is likely to witness a fierce battle amid the bulls and bears. If the sellers peak, a drop to $216 is possible for BNB. Instead, if the price rises from the current level or the $258 reinforcement, the bulls will try to push BNB above the moving averages. If this happens, it is possible for BNB to attempt a rally to $300. It is possible that this level can act as a strong barrier. However, if the bulls surpass this, it is possible for BNB to rise to $338.
XRP fell below the developing symmetrical triangle pattern on October 20. However, the long tail on the candlestick indicates that the bulls are buying dips to the 50-day SMA ($0.43). Buyers again defended the 50-day SMA on Oct. 21.
The 20-day EMA ($0.46) has started falling. Also, the RSI has slipped into negative territory, indicating that the bears have a slight advantage. If the price drops from the current level or the 20-day EMA, the bears will try to push XRP to the breakout level of $0.41. This level is likely to attract strong purchases. On the upside, a break and close above the 20-day EMA will be the prime indicator of strength. It is possible for XRP to rally to $0.51 and then the resistance line later on. It is possible that a break and close above the triangle will improve the expectations for the resumption of the uptrend.
ADA, SOL, DOGE and MATIC analysis
ADA has been in a downtrend for the past few days. After a two-day relief rally, sales resumed on October 18. Thus, the bears pushed the price to the key edge of the wedge.
The sharp selling of the last few days has truly rounded the RSI into the multisold zone. This suggests that the sell-off may have gone too far in the near term and a relief rally or consolidation is just around the corner. If the price breaks out of the mains line, ADA will attempt to move up to $0.36 and then the 20-day EMA ($0.38). A break above this level will be the first indication that the bears will lose their grip. On the downside, if the price drops below the mainstay, selling could accelerate further and ADA could drop to $0.30.
SOL dropped below the $29.42 support on Oct. 19, pointing to increased selling pressure from the bears. Selling continued and a $27.87 boost was received on October 21. This paves the way for the critical reinforcement to be retested at $26.
The falling moving averages and the RSI in the negative zone show that the bears are in control. If the SOL fails to rebound sharply from $26, the probability of a break below it increases. SOL is likely to drop to the next foothold at $22 later. Contrary to this assumption, if the price rises from the current level or $26 and rises above $30, it will signal accumulation at lower levels. After the SOL breaks above the 50-day SMA ($32.28), the bullish momentum is likely to rally in the near term.
Attempts by the bulls to push Dogecoin (DOGE) above the moving averages have met with valuable resistance from the bears. Sellers will now try to push the DOGE price down around $0.06.
The falling 20-day EMA ($0.06) and the RSI below 45 suggest the DOGE bears have the upper hand. If the sellers sink the price below the reinforcement, DOGE could drop to the June low of $0.05. Bulls will have to defend this level with all their might. Because, if the reinforcement is broken, DOGE will probably start the next leg of the downtrend. If the bulls want to avoid a collapse, they will have to push the price above the moving averages quickly. DOGE is likely to rally to $0.07 later, where the bears will form strong resistance again.
MATIC dropped from $0.88 on October 19 and settled below the moving averages on October 21. The failure of the bulls to defend the moving averages in the test, again, is a negative sign.
If the price stays below the moving averages, the probability of a drop to the $0.71 to $0.69 support area increases. If the price bounces back from this zone, it will suggest that MATIC will consolidate in a narrower range mid-$0.69 to $0.88 for a few days. The horizontal moving averages and the RSI quickly below the midpoint point to a consolidation in the near term. On the other hand, if the price quickly reverses course and rises above $0.88, it will suggest a real shift in sentiment from selling on rallies to buying on dips. It is possible for MATIC to rally to $0.94 and subsequently to $1.05 later.