Bitcoin (BTC) and most major altcoins have bounced off their immediate support levels, indicating that the sentiment is improving and traders are buying on minor dips.
Billionaire and Mexico’s third-richest person Ricardo Salinas Pliego said in his Christmas and New Year message to stay away from fiat money, terming it as “fake money made of paper lies.” Instead, he advised people to “invest in Bitcoin.”
Veteran trader Peter Brandt warned that “chart pattern breakouts should be viewed with great suspicion” during the thinly traded holiday period in the last half of December.
Analysts remain bullish for 2022. Crypto analyst and pseudonymous Twitter user DecodeJar believes that Bitcoin could surpass $100,000 and reach the conservative price target at $190,000.
Could Bitcoin continue its recovery in the next few days and pull altcoins higher? Let’s study the charts of the top-10 cryptocurrencies to find out.
BTC/USDT
Bitcoin successfully held the 20-day exponential moving average ($50,033) for the past three days, signaling that bulls are buying on dips. This is likely to attract further buying from the bulls.
The 20-day EMA has started to turn up and the relative strength index (RSI) has risen into the positive zone, indicating that bulls are at an advantage.
If buyers propel the price above the 38.2% Fibonacci retracement level at $52,314, the prospects of a rally to the stiff overhead resistance at $60,000 increase. The bears are likely to defend this level with vigor.
This bullish view will be negated if the price turns down from the current level or the overhead resistance and breaks below the moving averages. That could pull the BTC/USDT pair to the strong support at $45,456.
ETH/USDT
Ether (ETH) broke and closed above the 20-day EMA ($4,065) on Dec. 23 but the bulls have not been able to build upon this advantage. This suggests that the bears have not yet given up and are selling on rallies.
The flat 20-day EMA and the RSI near the midpoint indicate a balance between supply and demand. The bullish momentum could pick up if bulls propel and sustain the price above the overhead resistance at $4,200. This could clear the path for a possible rally to $4,488, followed by a retest of the all-time high at $4,868.
On the contrary, if the price turns down from the current level and breaks below $3,893.23, it will suggest that bears have gained the upper hand. That could pull the ETH/USDT pair to $3,643.73 and then to the 200-day simple moving average ($3,339).
BNB/USDT
After trading close to the 20-day EMA ($549) for the past three days, Binance Coin (BNB) has climbed above the resistance today.
The 20-day EMA is flat and the RSI is just above the midpoint, suggesting a status of equilibrium between the bulls and the bears. If the price sustains above the 20-day EMA, it will indicate that bulls have overpowered the bears.
The BNB/USDT pair could first rally to $575 and then rise to $617. Alternatively, if the price turns down from the current level, the bears will attempt to pull the pair to $500. This is an important support for the bulls to defend because if it cracks, the decline could extend to the 200-day SMA ($442).
SOL/USDT
Solana (SOL) broke and closed above the 20-day EMA ($187) on Dec. 23, indicating that the correction may be ending. The bears tried to pull the price back below the 20-day EMA on Dec. 24 but the bulls did not relent.
This may have attracted further buying by traders. The SOL/USDT pair could now rise to the resistance line of the falling wedge pattern where the bears are likely to mount stiff resistance.
If the price turns down from the resistance line but rebounds off the 20-day EMA, it will suggest that bulls are buying on every minor dip. That will increase the possibility of a break above the wedge, opening the doors for a retest of $259.90.
Conversely, if the price turns down and breaks below the 20-day EMA, the pair could slide to $167.88. A break below this support may sink the pair to the 200-day SMA ($125).
ADA/USDT
The bulls successfully defended the 20-day EMA ($1.39) for the past three days. This indicates that the sentiment has turned positive and traders are buying on dips. Cardano (ADA) has resumed its recovery today.
The RSI has risen above 58 and the 20-day EMA has started to turn up, indicating that bulls are attempting a comeback. The ADA/USDT pair could rise to $1.76 and then to the stiff overhead resistance at $1.87.
This bullish view will invalidate if the price turns down from the current level and breaks below the 20-day EMA. Such a move will suggest that bears are selling on rallies. The bears will then attempt to pull the pair below $1.18. If they do that, the pair could drop to $1.
XRP/USDT
XRP turned down from the psychological resistance at $1 on Dec. 24, indicating that bears are active at higher levels. The sellers pulled the price to the 20-day EMA ($0.90) but a minor positive is that bulls have held this level for the past three days.
The price is currently stuck between the moving averages. If buyers push the price above the 200-day SMA ($0.94), the XRP/USDT pair could rally to $1. A breakout and close above this level could complete an inverse head and shoulders pattern, which could open the doors for a possible rally to $1.25.
On the contrary, if the price breaks and sustains below the 20-day EMA, the pair could drop to $0.85. If this level also cracks, the decline could reach the critical support at $0.75. A strong rebound off this level could keep the pair range-bound between $0.75 and $1 for a few more days.
LUNA/USDT
The bulls repeatedly pushed Terra’s LUNA token above the $100 resistance in the past three days but they have not been able to sustain the higher levels. This suggests that the bears continue to defend this level aggressively.
The LUNA/USDT pair could now correct to the 38.2% Fibonacci retracement level at $83.83 and then to the 50% retracement level at $77.72. This zone is likely to act as strong support.
If the price rebounds off this zone, it will suggest that the trend remains bullish and traders are buying on dips. The bulls will then again attempt to push the price above the all-time high at $103.60.
If they manage to do that, the pair could rally to $124.65 and then to $150. This positive view will invalidate if the price turns down and breaks below the 61.8% Fibonacci retracement level at $71.61.
Related: Bitcoin rises above $51K as the dollar flexes muscles against the euro
AVAX/USDT
Avalanche (AVAX) once again bounced off the 20-day EMA ($109) on Dec. 26 indicating that bulls are buying on dips. The rising 20-day EMA and the RSI above 57 indicate that bulls have the upper hand.
If the price sustains above the 20-day EMA, the bulls will attempt to clear the overhead resistance zone between the 61.8% Fibonacci retracement level at $119.69 and the 78.6% retracement level at $131.70. If they succeed, the AVAX/USDT pair could rise to the all-time high at $147.
On the contrary, if the price turns down from the current level or the overhead zone and plummets below the 20-day EMA, it will suggest that traders are booking profits at higher levels. The pair could then drop to $98 where buyers may attempt to stall the decline.
DOT/USDT
The bulls successfully defended the 20-day EMA ($28.91) on Dec. 24 and 25, indicating that the sentiment has turned positive and traders are buying on dips. Sustained buying has pushed Polkadot (DOT) above the overhead resistance at $31.49 today.
The 20-day EMA has started to turn up gradually and the RSI has jumped into the positive territory, indicating that bulls are in command.
If buyers sustain the price above $31.49, the bullish momentum could pick up further and the DOT/USDT pair could start a new up-move. The first target on the upside is $39.35 and if this level is crossed, the next stop could be $43.56.
Contrary to this assumption, if the price turns down and breaks below the moving averages, the pair could drop to the strong support zone at $25 to $22.66.
DOGE/USDT
Dogecoin (DOGE) has been trading between the 20-day EMA ($0.18) and the overhead resistance at $0.19 for the past three days. This suggests that both bulls and bears are playing it safe and not making large bets.
A break and close above $0.19 will signal that bulls have absorbed the supply. That could start a recovery to $0.22 and if this level is crossed, the DOGE/USDT pair could reach the 200-day SMA ($0.23).
The bulls will have to clear this hurdle to signal the start of a sustained up-move. Alternatively, if the price turns down and breaks below the 20-day EMA, it will suggest an advantage to bears. The pair could then slide to the strong support at $0.15.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Market data is provided by HitBTC exchange.