The S&P 500 is trading near its all-time high, but Bitcoin (BTC) has plunged about 30% from its all-time high of $ 69,000. Even after the sharp decline, Bitcoin is up 63% year-to-date, outperforming the S&P 500, which is up around 30% in 2021.
Gold, which is popular as an inflation hedge, is down about 7% this year. Arcane research said in its report that Bitcoin’s outperformance in the high inflation environment shows that “Bitcoin has proven to be an excellent hedge against inflation.”
Real Vision CEO Raoul Pal said in an interview with Vlad of The Stakeborg Talks that Bitcoin’s recent sale may have been due to institutional investor profits, but he believes the sale may be coming to an end.
However, seasoned trader Peter Brandt is of the opinion that the panic sell has yet to take place, which is known to signal lows.
Could Bitcoin extend its decline or stage a strong rally above $ 50,000 in the coming days? Let’s study the charts of the top 10 cryptocurrencies to find out.
BTC / USDT
Bitcoin broke overhead resistance at $ 51,936.33 on December 27, but the long fuse on the candlestick shows traders sold that rise vigorously. The sale continued on December 28, and the price fell below the 20-day exponential moving average ($ 49,558).
The price fell below the 200 day simple moving average ($ 47,755) today, but the long tail on the candlestick shows the bulls are trying to stop the decline. If the price rises and holds above the 200 day SMA, the bulls will try again to push the BTC / USDT pair towards aerial resistance at $ 51,936.33.
On the contrary, if the price holds below the 200-day EMA, the sell-off could intensify. The 20-day EMA has started to drop and the Relative Strength Index (RSI) is below 42, indicating the bears are in control. If the support at $ 45,456 does crack, the pair could dip into the strong support zone at $ 42,000 to $ 40,000.
ETH / USDT
Ether’s (ETH) failure to hold above the 20-day EMA ($ 4,011) could have attracted short-term trader sales. The price fell sharply on Dec 28 and fell near the strong support at $ 3,643.73.
If the price bounces out of support, the bulls will make another attempt to push the ETH / USDT pair above the 20 day EMA. A breakout and close above $ 4,200 could indicate that the corrective phase may be over. The pair could first climb back to $ 4,488 and then challenge the all-time high of $ 4,868.
However, the downward slope of the 20-day EMA and the RSI in the negative area indicate that the path of least resistance is on the downside. If the support at $ 3,643.73 cracks, the pair could drop to the 200-day SMA ($ 3,353). This level may provide strong support, but if it cracks, the pair could drop to $ 2,800.
BNB / USDT
Binance Coin (BNB) climbed above the 20-day EMA ($ 546) on December 27, but the bulls were unable to maintain the higher levels. The price fell and fell below the 20-day EMA on December 28.
The bears will now try to drop the price below the strong support at $ 500. If successful, this could start a decline towards the 200 day SMA ($ 444) where the bulls are likely to defend the level aggressively.
Contrary to this assumption, if the price rises from the current level or strong support at $ 500, it will suggest that the bulls continue to buy on the lows. A breakout and close above $ 575 will signal that the correction may be over. The pair might first move up to $ 617 and then to the air resistance zone at $ 669.30 to $ 691.80.
SOL / USDT
Solana’s (SOL) rally stagnated at $ 204.75 on December 27, and the price fell below the 20-day EMA ($ 185) on December 28. This suggests that bears continue to sell on rallies.
The bears will now try to take advantage of their advantage and pull the price below $ 167.88. If this support cracks, SOL / USDT could drop to $ 148.04. The 20-day EMA is flat, but the RSI has fallen below 44 indicating that the bears are trying to gain the upper hand.
This negative opinion will cancel out in the short term if the price rises from the current level and exceeds $ 204.75. This will pave the way for a possible rally to the resistance line of the descending wedge pattern. A break out of the wedge will signal that the bulls are back in control.
ADA / USDT
Cardano (ADA) declined $ 1.59 on Dec. 27 and the price dropped to the 20-day EMA ($ 1.39). If the price rebounds from the current level, the buyers will try to push the price up to the resistance line of the descending channel.
The 20-day flat EMA and the RSI near the midpoint suggest a balance between supply and demand. A breakout and close above the channel will indicate that the downtrend may be over. The bulls will then try to push the price towards the strong overhead resistance at $ 2.47.
On the flip side, if the price holds below the 20 day EMA, it will suggest that bears continue to sell on rallies. ADA / USDT could then drop into the strong support area at $ 1.18. If this support cracks, the pair could drop to $ 1.
XRP / USDT
The bulls’ failure to push XRP above the 50-day SMA ($ 0.94) on December 27 may have attracted short-term traders to sell. This took the price below the 20-day EMA ($ 0.89) and support to $ 0.85.
The 20-day EMA fell and the RSI plunged into the negative zone, indicating that the bears have a minor advantage. If the price holds below $ 0.85, XRP / USDT could move lower to solid support at $ 0.74.
Conversely, if the price rises from the current level and breaks above the moving averages, it will suggest that lower levels are attracting big buying from the bulls. The pair can then go up to $ 1. A breakout and close above that level could complete an inverted head-and-shoulder setup, which has a setup target of $ 1.25.
LUNA / USDT
Terra’s LUNA token fell $ 103.60 on December 27 and the price fell to the 38.2% Fibonacci retracement level at $ 83.83. The bulls will likely try to block the correction in the area between $ 83.83 and the 20-day EMA ($ 80).
A strong rebound out of this zone will suggest that sentiment remains bullish and traders are not waiting for a deep correction to buy.
The bulls will then try to push the price up to $ 103.60. A breakout and close above this resistance could indicate a resumption of the uptrend. The first target on the upside is $ 135.26, then $ 150.
This positive opinion will be reversed in the short term if the price drops and falls below the 20 day EMA. This could bring the price down to the 61.8% Fibonacci retracement level at $ 71.61.
Related: A fair comparison? Ethereum’s growth exceeds Bitcoin’s in 2021
AVAX / USDT
The Avalanche Bounce (AVAX) on the 20-day EMA ($ 108) on December 26 collapsed to $ 120.96 on December 27. This suggests that the bears continue to sell at higher levels.
AVAX / USDT moved lower and broke below the 20-day EMA on December 28. If the bears keep the price below this level, the next stop could be $ 98. A breakout and close below that support could open the doors for a possible fall to $ 75.50.
Conversely, if the bulls push the price above the 20-day EMA, the pair could move up towards the downtrend line. A breakout and close above this resistance would suggest that the correction may be over. The pair could first hit $ 130 and then retest the all-time high at $ 147.
DOT / USDT
The bulls pushed Polkadot (DOT) above air resistance at $ 31.49 on Dec 27, but the long wick on the candlestick suggests selling at higher levels.
The failed breakout could have acted like a bull trap, catching aggressive buyers on the wrong foot. This may have resulted in a long selloff, pulling the price below the moving averages.
Both moving averages are flat and the RSI is just below the midpoint, indicating a balance between supply and demand.
If the bulls push the price above the moving averages, the pair could climb back to $ 31.49. A breakout and close above this level could signal an advantage to buyers. The pair could then rise to $ 39.35 and later to $ 43.56.
On the flip side, a breakout and close below the $ 25 to $ 22.66 support zone will indicate that the bears are in control.
DOGE / USDT
Dogecoin (DOGE) refused air resistance at $ 0.19 and fell back below the 20-day EMA ($ 0.18) on December 28. This suggests that the bears continue to defend the air resistance level.
DOGE / USDT could now drop to $ 0.15 which is a key level for the bulls to defend. If the price bounces off that support, the pair could remain stuck between $ 0.15 and $ 0.19 for the next few days.
The bulls will need to push and hold the price above $ 0.19 to signal the start of a strong rally of relief.
On the contrary, if the bears sink in and hold the price below $ 0.15, it will suggest that the downtrend has resumed. The pair could then drop to $ 0.13 and later to psychological support at $ 0.10.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trade move involves risk. You should do your own research before making a decision.
Market data is provided by HitBTC exchange.