US equity markets deviated from the hotter-than-expected labor data on December 2 and rallied strongly from their intraday low. This suggests that market watchers think the Federal Reserve may not change its stance to slow the pace of rate hikes because of the latest jobs data.
Although the FTX crisis broke the positive correlation between the US stock markets and bitcoin (BTC), recent strength in equity markets shows risk sentiment. This could be favorable for the cryptocurrency space and could attract dip-buyers.
The recovery of cryptocurrencies in general could gather strength when the extent of the damage caused by the FTX crisis becomes clearer. Until then, the bullish price action may be limited to certain cryptocurrencies.
Let’s take a look at the charts for bitcoin and some altcoins that may be preparing to start a short-term bullish move.
Bitcoin has been trading near the 20-day EMA ($16,963) for the past three days.. This suggests a tough battle between the bulls and the bears to win supremacy.
The main hurdle for buyers to the upside is $17.622. If the bulls catapult the price above this level, it will suggest that the downtrend might be over. and the BTC/USDT pair could then run towards the psychological level of $20,000. This level could act as resistance again, but if crossed, the pair could rally as high as $21,500.
On the contrary, if the price turns down from $17,622 and breaks below the 20-day EMA, it will suggest that the bears have not given up yet.. Thereafter, the pair could consolidate in a wide range between $15,476 and $17,622.
Buyers are defending the 20-EMA on the 4-hour chart, but the failure to pull off a major bounce indicates that demand is drying up at higher levels. The bears could try to take advantage of this opportunity and push the price below the moving averages. If successful, the pair could drop as low as $16,000 and then as low as $15,476.
Secondly, if the price rises and breaks above $17,250, the probability of a rally to $17,622 increases. This level can again act as major resistance, but if the bulls push the price above it, the pair could rally as high as $18,200.
Toncoin (TON) broke out of the symmetrical triangle pattern on Nov 30, but the bulls were unable to hold the higher levels, as seen on the long wick of the day candle. However, the bulls defended the 20-day EMA ($1.73) on the downside, indicating buy on dips.
Bullish moving averages and RSI in the positive zone indicate advantage for buyers. This improves the prospects for a break above the resistance line of the triangle. If that happens, the buying could accelerate and the TON/USDT pair could rally as high as $2.15 and then march towards the pattern target of $2.87.
This positive view could be reversed in the short term if the price breaks out of the resistance line again and dips below the 20 day EMA.. That could add to the selling pressure and take the pair to the 50-day SMA ($1.62) and later to the support line.
The bears are trying to defend the overhead resistance at $1.84, while the bulls are buying dips towards the 20-day EMA.. Price is being pushed between the two levels and may be ready for a range breakout.
If the price breaks above the upper zone between $1.84 and the downtrend line, it could attract more buying by the bulls.. The important level to watch on the downside is $1.68, as a break below could accelerate the decline to the support line.
ApeCoin (APE) broke away from the downtrend line on November 30, but the bulls have not allowed the price to break below the 20-day EMA ($3.73). This is a positive sign, as it indicates that there is demand at lower levels.
The 20 day EMA is gradually turning higher and the RSI has jumped into the positive territory, indicating that the bulls are trying to come back. The APE/USDT pair could pick up momentum if it breaks above the downtrend line. This could open the doors for a potential rally to $5 and then $6.
On the contrary, If the price turns lower and breaks below the 20-day EMA, it will suggest that the bears are active at higher levels.. In that case, the pair could drop as far as $3, which is likely to act as major support.
The 20-EMA on the 4-hour chart has flattened out and the RSI is near the midpoint, indicating a balance between supply and demand.. This uncertainty could shift in favor of the bulls if they push the price above $4.05. In that case, the pair could rally to the downtrend line.
If the bears want to take the lead, they will have to push the pair below $3.77.. If they do, the decline could extend to $3.50.
Trust Wallet Token (TWT) bounced strongly from the 20-day EMA ($2.07) on Nov. 27 and broke above the $2.45 resistance on Dec. 2. This suggests that the trend is still up and traders are viewing dips as a buying opportunity.
The bears could pose a major challenge again at $2.73, but if the bulls break this barrier, the TWT/USDT pair could resume the uptrend. The next upside stop could be $3 and if this level is broken as well, the pair could shoot up to the pattern target of $3.51.
On the contrary, If the price turns lower and breaks below $2.25, the pair could drop to the 20-day EMA. This remains the key level to watch on the downside, as a break below it could send the pair towards $1.81. A bounce from this level could suggest that the pair consolidates between $1.81 and $2.54 for a few days.
On the 4 hour chart, the 20 EMA has risen and the RSI is in the positive zone, indicating that buyers have an advantage.. The bulls will try to overcome the resistance zone between $2.54 and $2.73. If they succeed, the pair could start the next leg of the uptrend.
On the contrary, If the price turns lower and breaks below the 20-EMA, the upside momentum could weaken and the pair could slide to the 50-SMA. The pair could stay in a range for some time before starting the next trending move.
Aave (AAVE) rallied strongly from the $50 psychological support and broke above the 20-day EMA ($63).. The buyers are currently trying to bolster their position by turning the 20 day EMA into support.
The bears are trying to defend the $68 32.8% Fibonacci retracement level, but one small positive is that the bulls have not given up much ground.. This indicates that buyers anticipate a move higher.
The 20 day EMA has flattened out and the RSI is near the midpoint, indicating that the bears may be losing their grip. If the buyers push the price above $68, the AAVE/USDT pair could rally to the 50-day SMA ($71) and thereafter to the 61.8% retracement level at $80.
On the contrary, If the price turns lower and breaks below the 20-day EMA, the pair could drop to the support line of the channel..
The pair is facing resistance near $66 and the RSI has formed a negative divergence on the 4-hour chart, which suggests that bullish momentum could weaken in the short term. A break below the 50-SMA could take the price to the $56-$58 support zone.
Secondly, if the price rallies from the current level and breaks above $66, the pair could rally as high as $71. This level could act as resistance again, but if the bulls push the price above, the rally could extend to $80.
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