Bitcoin price is showing some early signs of a relief rally, and SOL, LTC, LINK, and BSV could be next if the bulls retake $20,000 as support for BTC.
The price of bitcoin (BTC) fell to $17,622 on June 18. It is the first time in the history of Bitcoin that it has fallen below its previous cycle high.. The aggressive monetary tightening of the US Federal Reserve, the crisis of the cryptocurrency lending platform Celsius and the liquidity problems of the investment fund Three Arrows Capital are creating a sense of panic among traders.
Markets commentator Holger Zschaepitz said that bitcoin price has crashed more than 80% four times in history. That puts the current drop of about 74% within historical standards. Previous bear markets have bottomed just below the 200-week moving averageaccording to market analyst Rekt Capital. If history repeats itself, the price of bitcoin is unlikely to remain at current depressed levels for long..
Coinglass data suggests that bitcoin’s 39% loss in june this year is the worst since 2013. While several investors expect bitcoin price to bottom out soon, cryptocurrency critic Peter Schiff warned that the sell-off could continue and the largest cryptocurrency could fall as low as $3,000.
Could the bulls stop the short-term bitcoin price decline? If that happens, let’s study the charts of the top 5 cryptocurrencies that could outperform all other coins.
- What is happening with the price of Bitcoin?
BTC/USDT
Bitcoin price crashed below the crucial support of $20,111 on June 18, signaling the resumption of the downtrend. A small silver lining is that the bulls bought during the dip, as seen in the long tail of the daily candlestick.
The buyers are trying to push the price back above the breakout level of $20.111.. If they manage to do so, it will suggest that the drop to $17,622 on June 18 may have been a bear trap. The BTC/USDT pair could then rally to $23.362 where the bears could once again mount major resistance.
The Relative Strength Index (RSI) has been trading in the oversold zone for the past few days, suggesting a relief rally in the near term.
This positive view could be invalidated if the price turns below $20,111.. That will suggest that the bears have turned the level into resistance and will increase the chance of a break below $17.622. The next support on the downside is $16,000.
The positive divergence on the RSI suggests that the bears may be losing their grip. The 4-hour chart shows that the price has recovered to the 20 exponential moving average.
This is an important level for the bears as if it breaks and closes above it, the pair could reach the upper resistance zone between the 50 SMA and $23.362.
On the contrary, if the price fails to sustain above the 20 EMA, it will suggest that the bears are active at higher levels. Sellers will once again try to push the pair to $17.622.
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SOL/USDT
Solana (SOL) has been in a strong downtrend, but positive divergence on RSI suggests bearish momentum might be weakening.
The bulls will try to push the price above the 20-day EMA ($36). If they do, it will suggest that the bulls are back. Thereafter, the SOL/USDT pair could rally to the 50-day SMA ($50), where the bears could once again mount a major defense.
On the contrary, if the price turns below the 20-day EMA, it will suggest that the bears do not want to give up their advantage. Then sellers will try again to drive the price below $25 and start the next leg of the downtrend.
On the 4 hour chart, the bulls have broken above the moving averages and will try to overcome the downtrend line hurdle.. If they succeed, it will be understood that the downtrend has ended in the short term. Buyers will try to push the price to $42.50 and then to $45.
On the contrary, if the price turns down from the current level or the downtrend line and breaks below the moving averages, it will suggest that the bears are still aggressively defending the overhead resistance. That could take the price to $27.50 and later to $25.
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LTC/USDT
The bears attempted to drop Litecoin (LTC) below the important $40 support on June 18.but the long tail of the day candle suggests that the bulls are defending the level aggressively.
The relief rally has reached the 20-day EMA ($55) which is an important level to watch as a breakout and close above it could suggest a potential trend reversal.. The LTC/USDT pair could rally to the 50-day EMA ($68) thereafter.
Contrary to this assumption, if the price turns down from the 20-day EMA, it will suggest that the trend is still negative and traders are selling on the rallies. Then the bears will make another attempt to drop the pair below $40 and resume the downtrend.
Price has broken out of a symmetrical triangle pattern on the 4-hour chart. Although this setup often acts as a continuation pattern, sometimes indicates a possible reversal. The moving averages have completed a bullish crossover, which suggests an upside for buyers. If the buyers sustain the price above the triangle, the pair could rally to the $62 pattern target.
This positive view could be invalidated in the short term if the price turns down and re-enters the triangle.. This move will suggest that the break above the triangle may have been a bull trap.
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LINK/USDT
Chainlink (LINK) is in a downtrend but trying to form a bottom near $5.50. The bears pushed the price below this level on June 13, June 14 and June 18, but they were unable to sustain the lower levels. This suggests that the bulls are buying the dips.
Positive divergence on the RSI suggests bearish momentum may be weakening. The buyers will try to push the price towards the downtrend line, which is likely to act as a major resistance.
If the price breaks out of the downtrend line, the bears will once again attempt to drop and hold the LINK/USDT pair below the $5.50 support.. If this happens, it will suggest a resumption of the downtrend.
Secondly, if the buyers drive the price above the downtrend line, it will suggest a possible trend reversal. The pair could rise to $10 and then to $12.
The pair’s rally has reached the 50-SMA which can act as a minor resistor. The 20 EMA is flattening out and the RSI is close to the midpoint, which suggests that the bears may be losing their grip..
If the buyers push the price above the 50-SMA, the pair could rally to $7.51.. If it breaks out and closes above this resistance, a short-term double bottom pattern will complete. This reversal setup has a pattern target of $9.50.
To invalidate this bullish view, the bears will have to break down and sustain the price below the important support at $5.50..
USD/BSV
Bitcoin SV (BSV) has formed a widening pattern and the buyers are trying to push the price above the resistance of the setup. The RSI is showing a positive divergence, indicating that the bearish momentum is weakening.
The BSV/USD pair could rally to the resistance line, where the bears could try to stop the rally. If this happens, it will suggest that the bears are still selling on rallies.. This could keep the pair stuck inside the widening formation for a while longer.
On the contrary, if the bulls break above the resistance line, the pair could make a bottom. Then the pair could start a new move higher that could take it to $80 and then to $87.
The 4-hour chart shows that the pair has been trading in a wide range between $45 and $66.. After a failed attempt by the bears to push the pair below the range, the bulls will try to push the price above the resistance.
If they succeed, the pair could start a new move higher. The target of this setup is $87. Another possibility is for the price to turn below $66. If this happens, the pair could remain range bound for some time to come.
Clarification: The information and/or opinions expressed in this article do not necessarily represent the views or editorial line of Cointelegraph. The information set forth herein should not be taken as financial advice or investment recommendation. All investment and commercial movement involve risks and it is the responsibility of each person to do their due research before making an investment decision.
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