Bitcoin (BTC) fell below $40,000 on January 10 for the first time since September 2021. The cryptocurrency markets weren’t alone as US stock markets also saw strong sales as traders chose to reduce risks and piled into 10-year treasury. Which jumped to 1.8% from 1.51% at the end of 2021.
On January 9, Goldman Sachs’ chief economist, Jan Hatzius, said the US Federal Reserve could raise interest rates by four-quarters of a percentage point in 2022.
Analyst Alex Krüeger also warned that the cryptocurrency markets may not be able to ignore the Fed if it “decides to do everything with a deflationary machete.” He was not alone as former BitMEX CEO Arthur Hayes and Bentoshi also predicted a bearish picture.
Quantitative analyst Benjamin Cowen gave the bulls some hope when he said that “extreme fear” levels in the Crypto Fear & Greed indicator had only occurred four times since 2018 and had been followed by bullish reversals that resulted in strong returns between 17% and 1,585%. in bitcoin.
Could Bitcoin and the major cryptocurrencies start to rally or will support levels collapse? Let’s study the charts of the top 10 cryptocurrencies to find out.
BTC / USDT
Bitcoin dropped to $39,650 today as buyers stepped in and bought aggressively, as evidenced by the long tail of the candlestick. If the buyers maintain the bounce, the price may attempt to approach the 20-day exponential moving average ($45,369).
Both moving averages are down and the Relative Strength Index (RSI) is in oversold territory, which indicates bears in control. If the price drops from the 20-day moving average, the BTC/USDT pair may decline to the strong support level at $39,600 and stay in a range between these levels for a few days.
If the support at $39,600 is broken, the selling may intensify further and the pair could start its march towards $30K.
Conversely, if the bulls push the price above the 20-day EMA, the pair could rise to the strong air resistance at $52,088. A breakout and a close above this resistance could indicate a possible change in trend.
ETH / USDT
The bulls have been defending the support line of the descending channel in recent days but were unable to make a strong bounce from it. This indicates that demand is decreasing at higher levels. Ether (ETH) attempted a recovery on January 9, but was unable to break the breakout level at $3,250.
The price declined further today and the bears are trying to pull the ETH/USDT pair below the descending channel. If they succeed, the selling may intensify and the pair may drop to the next strong support level at $2,652.
This is an important support for the bulls to defend as if it has broken the pair, it may drop to the psychological support level at $2000.
Conversely, if the price rebounds from the current level, the bulls will make another attempt to breach the upper $3250 barrier and push the pair towards the channel resistance line.
BNB / USDT
Binance coin (BNB) slipped below the descending channel support line on January 8, but the long tail of today’s candle showed buying at lower levels. The bulls pushed the price back into the channel on January 9th, but failed to keep the price above the breakout level at $435.30.
The price is down again today and the bears are trying to keep the BNB/USDT pair below the channel. If they succeed, the pair could drop to $392.20. This is an important support for the bulls to defend as if the next stop might be $330 has been breached.
The RSI has fallen into the oversold territory, indicating that the selling may be oversold in the near term. This may lead to a slight recovery or beach related actions in the next few days. A breakout and a close above the 20-day moving average ($492) would be the first sign that the sellers might lose their grip.
SOL / USDT
Solana (SOL) attempted a rally on January 8, but the bulls were unable to push the price above $150. This indicates that the bears are selling relief pools.
If the speculators keep the price below $133, the SOL/USDT could drop to a strong support level at 116. Both moving averages are dropping and the RSI is approaching the oversold zone indicating bears in control.
If the $116 level breaks, the pair may move lower to the channel support line. If this support also collapses, the selling may intensify and the pair may drop to $82. The first sign of strength will be a breakout and a close above the 20-day moving average ($162).
ADA / USDT
Cardano (ADA) broke and closed below the $1.18 support on January 9, indicating a resumption of the downtrend. The next downside support is the critical $1 level.
Bulls are likely to defend this level aggressively as it has not been breached over the past few months. If the price rebounds above $1, the pair may reach the 50-day SMA ($1.39) where the bears should climb to a strong resistance.
If the price drops from the moving averages, the bears will make another attempt to pull the ADA/USDT pair below 1. If they succeed, the selling may accelerate and the pair may drop to the channel support line.
XRP / USDT
XRP closed below the $0.75 support on January 8 but rose above the level on January 9. This indicates that the bulls were trying to corner the aggressive bears, but the recovery attempt was short-lived.
The price is back below $0.75 today, which indicates that the bears are selling on every slight rally. The bearish moving averages and the relative strength index near the oversold area indicate the dominance of the bears.
If the price stays below $0.75, the XRP/USDT pair could drop to the intraday low on December 4th at $0.60. Bulls will need to push the price and hold above the 50-day SMA ($0.87) to signal the start of a stronger rally.
Moon / USDT
Terra’s LUNA token fell below the descending channel pattern on Dec 8th, but the long tail of today’s candle indicates buying at lower levels. The bulls pushed the price back into the channel and above the 50-day simple moving average ($70) on December 9.
The comfortable rally hit the $75.67 barrier and the price fell below the 50-day simple moving average today. This indicates that the bears continue to sell on rallies. The 20-day moving average ($78) is down, and the RSI is near 43, indicating bears are in control.
If the bears pull the price below $62.46, the selling may intensify and LUNA/USDT could drop to $51.84. This downtrend will be canceled if the price moves up from the channel support line and breaks the resistance line.
Related: Billionaire investor Bill Miller puts 50% of his net worth in Bitcoin
DOT / USDT
Polkadot (DOT) attempted to bounce off the strong support at $22.66, but the bulls were unable to push the price to the 20-day moving average ($26.95). This indicates that demand is decreasing at higher levels.
The bearish moving averages and the RSI are in negative territory, indicating that the bears have the upper hand. If the bears descend and continue the price below $22.66, the DOT/USDT pair may start falling to $16.81.
Alternatively, if the price rebounds from the current level, the bulls will once again attempt to push the pair above the 20-day moving average. If the pair succeeds, it could reach the 50-day SMA ($29.66) and then the upper resistance at $32.78.
AVAX / USDT
The avalanche (Afax) fell below the ascending trend line of the symmetrical triangle on January 8, but the bears were unable to take advantage of this advantage. The bulls pushed the price into the triangle again on January 9th.
However, the rally was short lived as the bears pushed the price below the triangle. This indicates that sentiment is still negative and that traders are selling with every slight rise.
There is a strong support at $75.50, but if it breaks, AVAX/USDT could drop to $57.02 and then to $50.
On the other hand, if the price bounces off the current level or the $75.50 support and settles inside the triangle, it will indicate a build-up at the lower levels. The pair could then go up to $98, where the bears can build up a strong resistance.
A breakout and a close above the moving averages could open the door for a rally to the downtrend line.
DOGE / USDT
Dogecoin (DOGE) has broken below the critical support level at $0.15, signaling the beginning of the next phase of the downtrend.
The descending moving averages and the oversold RSI indicate that the path of least resistance is to the downside. If the bears maintain the price below $0.15, DOGE/USDT could drop to the intraday low on December 4 at $0.13.
Contrary to this assumption, if the price rebounds from the current level, the bulls will try to push the pair above the moving averages. If they did, it would trigger a range between $0.19 and $0.15 and the pair could reach $0.19.
The bulls will need to push the price and hold above this resistance to signal the start of a new rally.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of TBEN. Every investment and trading movement involves risks. You should do your research before making a decision.
Market data is provided by HitBTC exchange.