Bitcoin (BTC) and most major altcoins are trying to bounce back from their respective support levels, indicating that buyers continue to pile up on lows.
Coinglass data shows that 9,925 Bitcoin left Coinbase Pro, the professional trading arm of Coinbase, on December 30, a possible sign of institutional buying. This contrasts sharply with the strong inflows seen on Binance and OKEx. Several analysts believe that institutional purchases could resume in January.
Economist and trader Alex Krüger expects Bitcoin to rally in early January based on cash flows. He also pointed out that January produced positive results for Bitcoin between 2018 and 2021, with gains ranging from 7% to 36%.
As investors debate the next possible direction for the crypto markets, MicroStrategy has continued to rack up Bitcoin on lows. The intelligence firm bought 1,914 Bitcoins between Dec. 9 and Dec. 29, according to a filing with the U.S. Securities and Exchange Commission. The recent purchase brought the company’s holdings to 124,391 Bitcoin.
Could Bitcoin Lead To A Strong Recovery In The Crypto Markets In The New Year? Let’s study the charts of the top 10 cryptocurrencies to find out.
BTC / USDT
Bitcoin rebounded from the support of $ 45,456 and broke the 200-day simple moving average ($ 47,826). However, the bulls are likely to face a significant challenge at the 20-day exponential moving average ($ 49,096).
If the price drops from the current level or the 20-day EMA, it will suggest that the bears are selling with every minor rally. This will increase the possibility of a breakout below $ 45,456. If this happens, the BTC / USDT pair could fall into the solid support area at $ 42,000 to $ 40,000.
The Relative Strength Index (RSI) forms a possible positive divergence, suggesting that the selling pressure may ease.
If the bulls drive the price above the 20-day EMA, the pair could climb back to $ 51,936.33. A breakout and close above this resistance could start a rise to the 50% Fibonacci retracement level at $ 55,000 and then to the 61.8% retracement level at $ 58,686.
ETH / USDT
Ether (ETH) rebounded off the solid support area at $ 3,643.73 to $ 3,503.68. The bulls will now try to push the price up to the 20 day EMA ($ 3,952) which is an important level to watch.
If the price drops from the 20-day EMA, it will suggest sentiment remains negative and traders are selling on rallies. The bears will then make another attempt to bring the price down below the support area.
A breakout and close below the 200 day SMA ($ 3,365) may signal the start of a deeper correction to $ 2,800. This negative opinion will be reversed if the price breaks and stays above $ 4,200. ETH / USDT could then climb to $ 4,488 and later to $ 4,868.
BNB / USDT
Binance Coin (BNB) is trying to bounce off the strong $ 500 support. The rally is expected to face the 20-day EMA sell-off ($ 540). If the price drops from this level, it will suggest that sentiment remains negative and traders are selling on rallies.
The declining 20-day EMA and RSI in negative territory indicate the bears are in control. A breakout and close below $ 500 could intensify selling and the BNB / USDT pair could drop to the 200 day SMA ($ 445).
Contrary to this assumption, if the price breaks the 20-day EMA, the bulls will try to push the pair above $ 575. If they are successful, the pair could climb back up to $ 617 and later to the air resistance zone at $ 669.30 to $ 691.80.
SOL / USDT
Solana (SOL) tries to bounce off $ 167.88. The rally of relief is expected to face strong selling at the 20-day EMA ($ 182). The RSI is in the negative zone and the 20 day EMA is gradually decreasing, indicating that the bears have an advantage.
If the price drops and falls below the support of $ 167.88, the SOL / USDT pair could drop to $ 148.04. The bulls can try to defend this level, but if the support gives way, the pair could begin its descent towards the 200 day SMA ($ 128).
This negative opinion will be invalidated if the bulls push the price above the 20 day EMA and overhead resistance at $ 204.75. The pair could then move up to the resistance line of the descending wedge pattern. A breakout and close above this level could pave the way for a retest of the all-time high at $ 259.90.
ADA / USDT
Cardano (ADA) broke and closed below the 20-day EMA ($ 1.38) on December 29, but buyers have yet to give up. They are trying to push the price above the 20 day EMA.
If they are successful, ADA / USDT could move up to the resistance line of the descending channel. Bears are likely to defend this level aggressively. If the price drops from the resistance line, the pair could extend its stay inside the channel for a few more days.
A breakout and close above the channel will be the first indication of a possible trend change. Conversely, if the price drops from the current level, the pair could drop to $ 1.18. This is an important level to watch because if it cracks the pair could drop to $ 1.
XRP / USDT
XRP is limited to a range between $ 1 and $ 0.75. The price rebounded from $ 0.80 on December 30 and the bulls will now attempt to push the price above the 20 day EMA ($ 0.88).
If they do, the XRP / USDT pair could hit the 200 day SMA ($ 0.94) and then overhead resistance at $ 1. The bulls will need to push and hold the price above this resistance to signal the start of a sustained rally.
The 20-day EMA drops and the RSI is below 45 indicating the bears have the upper hand. If the price drops from the 20-day EMA, the bears will attempt to push the pair below $ 0.75. A close below this level could pave the way for a downside to $ 0.60.
LUNA / USDT
Terra’s LUNA token bounced off the 20-day EMA ($ 81) on December 30, indicating sentiment remains positive and traders are buying on lows.
The bulls will now try to push the price to an all-time high of $ 103.60. A breakout and close above this resistance will signal the start of the next stage of the uptrend which could reach $ 135.26 and then $ 150.
On the other hand, if the price drops $ 93.81 and goes below the 20-day EMA, it will suggest that traders are closing their positions on rallies. LUNA / USDT could then drop to the 61.8% Fibonacci retracement level at $ 71.61.
Related: Frax Share, Swipe, and Gnosis Dominate Altcoin Market As Bitcoin Recovers To $ 47.5,000
AVAX / USDT
Avalanche (AVAX) rebounded from minor support at $ 98 on December 30 and the bulls are now trying to push the price above the 20 day EMA ($ 107).
If successful, AVAX / USDT could move up to the downtrend line where bears could mount strong resistance. A breakout and close above this level will be the first sign that the correction may be over.
The pair could then rise to $ 128. If the bulls push the price above this resistance, it will complete a bullish inverted head and shoulders pattern. The pair may first retest the all-time high at $ 147 and then attempt a rally towards the setup target of $ 177.50.
On the contrary, if the price drops from the 20-day EMA and falls below $ 98, the pair could drop to $ 75.50.
DOT / USDT
Polkadot (DOT) broke below the 20-day EMA ($ 28) on December 28 and the bears successfully repelled attempts by the bulls to push the price above the moving averages.
If the price drops from the current level, bears will try to drop the DOT / USDT pair below the $ 25 support area at $ 22.66. If that happens, the sell could accelerate and the decline could extend to $ 16.81.
Alternatively, if the price breaks the moving averages, buyers will try to propel the pair above $ 31.49. If they succeed, it could open the doors for a possible rally to $ 39.50 and later to $ 43.56.
DOGE / USDT
Dogecoin (DOGE) broke below the 20-day EMA ($ 0.17) on December 28, but the bears were unable to challenge the main support at $ 0.15. This suggests that the sale is drying up at lower levels.
The bulls are trying to push the price back above the 20 day EMA. If successful, DOGE / USDT could rally to overhead resistance at $ 0.19. A breakout and close above this level will signal the possible start of a further rise that could reach the 200-day SMA ($ 0.23).
Conversely, if the price drops against the 20-day EMA, bears will try to push the pair below $ 0.15. This is an important level for the bulls to defend as if it does crack the pair could dip to $ 0.13 and possibly 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.