Bitcoin (BTC) has seen a roller coaster ride in 2021 and even though BTC has corrected sharply from its all-time high of $ 69,000, the digital asset is still up 60% year-to-date. During the same period, gold fell more than 5%.
With inflation soaring in the United States and several other parts of the world, Bitcoin’s outperformance against gold shows investors may view it as a better hedge against inflation compared to gold. .
During the year, the total crypto market cap jumped to around $ 3 trillion, but Bitcoin’s dominance fell from around 70% at the start of the year to 40%. This shows that several altcoins outperformed Bitcoin by a huge margin.
As cryptocurrencies are increasingly adopted, there are several altcoins that are likely to capture the attention of investors. These could produce strong returns for investors over the next year or so.
Technical analysis has been used to arrive at the current list of large cap cryptocurrencies that could remain on the agenda in 2022 and benefit from a crypto bull run.
Let’s take a look at the charts of the top five cryptocurrencies to calculate their possible target goals and support levels to watch for in 2022.
BTC / USDT
Bitcoin (BTC) broke and closed above overhead resistance at $ 64,854 in early November, but the long wick on the candlestick shows profit taking at higher levels. The sale continued the following week and the price fell back below $ 64,854.
The bulls attempted to defend the 20 week exponential moving average (EMA) ($ 51,999), but were unable to maintain the rebound. This intensified the sell-off and pulled the price below the 50-week Simple Moving Average (SMA) ($ 47,681).
The bulls bought the bottom but failed to extend the rally above the 20 week EMA. This indicates a possible change in sentiment from buying on lows to selling on rallies. The bears are again trying to pull and hold the price below the 50 week SMA.
If they are successful, the BTC / USDT pair could drop to solid support at $ 39,600. The 20-week EMA started to decline and the Relative Strength Index (RSI) fell below 50, indicating the bears have the upper hand.
A breakout and close below $ 39,600 could cause a deeper correction to $ 28,805. Such a sharp drop could delay the start of the next stage of the uptrend.
On the other hand, if the bulls successfully defend the 100 week SMA, the pair will make another attempt to break the 20 week EMA. If this happens, the pair will attempt a rally to the air zone at $ 64,854 to $ 69,000.
A breakout and close above this area could initiate the next stage of the uptrend which could push the pair to the psychologically critical level at $ 100,000.
ETH / USDT
Ether (ETH) corrects in a strong uptrend. Both moving averages are rising and the RSI is in positive territory indicating that the bulls have the upper hand.
Although the bears have attempted to pull the price below the 20 week EMA ($ 3,745), the long tail on candlesticks in recent weeks shows that the bulls are aggressively buying at lower levels.
The bulls will now make another attempt to break through the barrier at the psychologically critical level at $ 5,000. If successful, ETH / USDT could initiate the next stage of the uptrend with the first target at a 100% Fibonacci extension level at $ 5,719.68.
If momentum carries the price above that level, the next target to watch is the 138.2% Fibonacci extension level at $ 6,566.19, then the 161.8% extension level. at $ 7,089.17.
Contrary to this assumption, if the price drops from the current level or air resistance and goes below the 20 week EMA, it will signal traders to sell on rallies. This could open the door for a possible fall to the solid support at $ 2,652.
This is an important level to watch on the downside as a break below could pull the pair to $ 1,700.
BNB / USDT
Binance Coin (BNB) fell $ 669.30, indicating that bears are aggressively defending the all-time high at $ 691.80. However, a minor bright spot is that the bulls buy the 20 week EMA ($ 500) declines.
The moving averages on the rise and the RSI in the positive zone indicate that the buyers have the upper hand.
If the price bounces from the current level, the BNB / USDT pair could hit the overhead area of $ 669.30 to $ 691.80. Bulls will need to break through this barrier to signal the resumption of the uptrend.
If that happens, the pair could begin the next stage of the upside to $ 848.30 and then attempt a rally to $ 1,171.90.
Another possibility is that the price will rebound off the 20 week EMA but turn away from the air resistance. In such a case, the pair may remain ranged for a few weeks.
Consolidation close to all-time high is a positive sign as it shows traders are not rushing to exit. This increases the prospects for further upside.
Conversely, if the bears sink and keep the price below the 20 week EMA, it will indicate that supply is exceeding demand. This could cause the SMA to drop by 50 weeks ($ 379). A breakout and close below this level could invalidate the bullish assumption.
Related: Nexo co-founder targets Bitcoin at $ 100,000 by mid-2022
AVAX / USDT
The strong rise of Avalanche (AVAX) to the all-time high of $ 147 had pushed the RSI close to the 85 level, indicating that the rise was excessive in the near term. This may have resulted in a profit taking by short term traders.
The bears have pulled the price below $ 81 for three straight weeks, but they have not been able to maintain the lower levels as shown by the long tail of the candlesticks. This indicates that the bulls have flipped the previous resistance at $ 81 in support.
The strong rebound of the EMA 20 ($ 73) indicates sentiment remains bullish and traders are buying on lows. The bulls will now try to push the price to an all-time high of $ 147.
A breakout and close above this resistance could initiate the next stage of the uptrend. The AVAX / USDT pair could then climb to $ 213.17 and if momentum holds, the rally could even expand to $ 260.
This bullish view will be invalidated if the price drops from the current level or air resistance and goes below $ 75.50. Such a move will indicate that sentiment has turned negative and traders are selling on rallies.
The pair could then drop to the strong support at $ 50. Such a deep fall is likely to delay the start of the next stage of the ascent.
MATIC / USDT
Polygon’s MATIC is in an uptrend. The bulls attempted to push the price above the all-time high at $ 2.70 but failed. This suggests that bears aggressively defend air resistance.
However, a positive sign is that the bulls are buying the 20 week EMA declines ($ 1.62). This indicates that sentiment remains bullish and traders are racking up lows.
Rising moving averages and the RSI near the overbought zone indicate that the path of least resistance is on the upside. The bulls will make another attempt to push the MATIC / USDT pair above $ 2.70.
If successful, the pair could enter the next stage of the uptrend which could reach $ 3.28. A breakout and close above this level could extend the rally to $ 4 and possibly $ 4.77.
Contrary to this assumption, if the price drops from the current level or air resistance and drops below the 20 week EMA, it will suggest that supply is exceeding demand.
If the price holds below the 20 week EMA, the sell could accelerate and the pair could drop to the 50 week EMA ($ 1.04).
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 comes with risk, you should do your own research before making a decision.