- February 28, 2022
- Posted by: Bogdan
- Category: Avalanche, Binance Coin, bitcoin, Cardano, Dogecoin, ethereum, Markets, Polkadot, price analysis, Ripple, Solana, Terra
Bitcoin and altcoins surprised investors with a sharp bullish breakout today, signaling a possible change in the short-term trend.
Bitcoin (BTC) soared above $40,000 on Feb. 28 even though the S&P 500 remained soft. This suggests that the correlation between Bitcoin and the U.S. equity markets may be showing the first signs of decoupling. If bulls sustain the price above $38,500 till the end of the day, Bitcoin would avoid four successive months of decline.
The volatility of the past few days does not seem to have shaken the resolve of the long-term investors planning to stick with their positions. Data from on-chain analytics firm Glassnode showed that the amount of Bitcoin supply that last moved between three to five years ago soared to more than 2.8 million Bitcoin, which is a four year high.
Interestingly, an experiment by Portuguese software developer Tiago Vasconcelos to develop an artificial intelligence trading bot for Bitcoin resulted in the bot concluding that “the best move is to buy as soon as possible and never sell!”
Could bulls sustain the momentum and push Bitcoin toward the next overhead resistance? Will altcoins also join the party? Let’s analyze the charts of the top-10 cryptocurrencies to find out.
Bitcoin turned down from the 50-day simple moving average ($40,261) on Feb. 26 but the bears could not pull the price below $37,000. The price rebounded sharply today and the bulls have cleared the overhead hurdle at the 50-day SMA.
If bulls sustain the price above the 50-day SMA, the BTC/USDT pair could start its northward journey toward the resistance line of the channel. The bears are expected to mount a strong defense at this level. The bulls will have to push the pair above the channel to indicate that the correction may be over.
The 20-day exponential moving average ($39,813) is flattening out and the relative strength index (RSI) has risen to just above the midpoint. This indicates that the bulls are attempting a strong comeback.
This positive view will invalidate in the short term if the price fails to sustain above the moving averages. The pair could then again drop to the support line of the channel.
Ether (ETH) turned down from the 50-day SMA ($2,865) and dropped to the support line of the triangle indicating that higher levels continue to attract selling by the bears.
The price has rebounded off the support line of the triangle but the bulls will have to push and sustain the ETH/USDT pair above the 50-day SMA to signal a possible change in the short-term trend. If that happens, the pair could rally to the resistance line of the triangle.
Conversely, if the price turns down from the moving averages, it will suggest that the bears continue to sell at higher levels. That will increase the possibility of a break below the triangle. A close below the triangle could open the doors for a possible retest at $2,300.
Binance Coin (BNB) turned down from the 20-day EMA ($385) on Feb. 26 but the price has rebounded sharply off the strong support at $350 on Feb. 28. This indicates that the price is stuck between these two levels.
Both moving averages are sloping down and the RSI is just below the midpoint, indicating that bears have a slight edge. If the price turns down from the 20-day EMA, the possibility of a break below $350 increases. If that happens, the BNB/USDT pair could drop to the $330 to $320 support zone.
Conversely, if the price rises from the current level and breaks above the moving averages, it will indicate that the bulls are attempting a comeback. The pair could then rally to $445.
Ripple (XRP) turned down from the downtrend line on Feb. 26, indicating that bears are defending this resistance with vigor. A minor positive is that the bulls are defending the support at the 50-day SMA ($0.72).
If the price maintains above $0.75, the bulls will again attempt to push and sustain the XRP/USDT pair above the downtrend line. If they succeed, it could clear the path for a possible rally to $0.91.
Alternatively, if the price turns down from the current level, the bears will try to pull the pair below $0.68. If that happens, the pair could retest the Feb. 24 intraday low at $0.62. The flattish moving averages and the RSI just above the midpoint do not give a clear advantage either to the bulls or the bears.
The bulls have sustained Cardano (ADA) above $0.82 in the past few days but are struggling to push the price to the breakdown level at $1. This indicates that demand dries up at higher levels.
The longer the price sustains below the moving averages, the greater the possibility of a retest of the recent intraday low at $0.74. If this support cracks, the downtrend could resume and the ADA/USDT pair could plunge to $0.68.
Contrary to this assumption, if the price rises and breaks above $1, it will suggest that the markets have rejected the lower levels. The pair could then rise to the resistance line of the descending channel. The bulls will have to push and sustain the price above the channel to indicate that the downtrend may have ended.
Solana (SOL) has been sandwiched between the 20-day EMA ($94) and the strong support at $81 but this tight range trading is unlikely to continue for long.
The RSI is showing signs of forming a positive divergence, signaling that the bearish momentum may be slowing. If bulls push and sustain the price above the 20-day EMA, the SOL/USDT pair could rise to the resistance line of the descending channel.
A break and close above the channel will be the first indication that the bears may be losing their grip. The pair could then rise to the overhead resistance at $122. This positive view will invalidate on a break and close below $81.
Avalanche (AVAX) has been oscillating near the moving averages for the past three days. Although bulls pushed the price above the moving averages on Feb. 25, they could not sustain the higher levels. Strong selling pulled the price back below the moving averages on Feb. 27.
The bulls are currently attempting to sustain the price above the moving averages. If they manage to do that, the AVAX/USDT pair could rally to the downtrend line of the descending channel. This level could act as a stiff resistance but if bulls overcome it, the pair will indicate that the downtrend may have ended.
Contrary to this assumption, if the price turns down from the current level or the overhead resistance, it will suggest that bears continue to sell on rallies. The bears could gain strength if the price slips below $64.
Terra’s LUNA token turned down from $80 but the bulls successfully defended the immediate support at $70. This indicates that traders are accumulating on every minor dip.
The buying picked up momentum today and the bulls pushed the price above the overhead resistance at $70. The upsloping 20-day EMA ($62) and the RSI in the overbought territory indicate that bulls are in control.
The LUNA/USDT pair could now rise to $90 where the bears may again mount a strong resistance. A break and close above this level could propel the pair to the all-time high at $103.
Conversely, if the price turns down from $90, the pair could again drop to $70 and consolidate between these two levels for a few days.
Dogecoin (DOGE) has been struggling to bounce off the strong support at $0.12, indicating a lack of urgency among bulls to buy at higher levels.
The longer the price clings to the strong support at $0.12 without a strong bounce, the greater the possibility of a breakdown. If the bears pull the price below $0.12, the DOGE/USDT pair could retest the psychological support at $0.10.
This is an important level for the bulls to defend because if it cracks, the selling could intensify further and the pair could slide to $0.06. The first sign of strength will be a break and close above the 50-day SMA ($0.14). That could result in a rally to $0.17.
Polkadot’s (DOT) recovery stalled at the downtrend line, indicating that the sentiment remains negative and traders are selling on rallies to strong resistance levels.
The price could remain stuck between the downtrend line and $14 for the next few days. If bears pull the price below $14, the DOT/USDT pair could resume its downtrend and decline to the strong support at $10.
The buyers will have to push and sustain the price above the downtrend line to signal that the bears may be losing their grip. The pair could then rally to the overhead resistance at $23 where the bears may mount a strong defense.
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.