Bitcoin (BTC) broke above $42,000 on March 19, but the bulls continue to face a strong challenge from the bears at higher levels.
Although the price of Bitcoin rebounded from $37,578 on March 13, Cointelegraph market analyst Marcel Pechman highlighted that the net long-to-short ratio of top traders on three major exchanges shows that professional traders have not been buying. aggressively.
But while Bitcoin struggles at higher levels, selected altcoins are showing strength. The BTCFuel Twitter account anticipates that altcoins could be entering “the tail end of the hype phase” and may peak in the summer.
Data from Glassnode shows that investors have withdrawn approximately 550,000 Ether (ETH) from centralized exchanges to date. Due to outflows, the net balance of Ether from exchanges has plummeted from 31.68 million Ether in June 2020 to 21.72 million Ether.
Could Bitcoin sustain above the psychological level at $40,000 and will that shift the focus to altcoins? Let’s study the charts of the five most notable cryptocurrencies to find out.
BTC/USDT
Bitcoin is facing resistance near $42,594, which suggests that traders are cautious at higher levels. The price could now slide towards the moving averages, which is an important support to watch out for.
If the price bounces off the moving averages, it will suggest that the bulls are not waiting for a deeper correction to buy. That could improve the prospects for a breakout and close above overhead resistance. If that happens, the BTC/USDT pair could rally to $45,400 and then to the resistance line of the ascending channel.
Contrary to this assumption, if the price turns down and breaks below the moving averages, the pair could slide towards $37,000. A bounce off this support will suggest that the pair may remain range bound between $37,000 and $42,594 for a few days.
The bears will have to pull and hold the price below the support line of the channel to signal a resumption of the downtrend.
The 4-hour chart shows that the bears are defending the overhead resistance at $42.594. If the price bounces off the 20 exponential moving average, the bulls will try to push the pair above the overhead resistance. If they manage to do that, the pair could rally towards $45,400.
Conversely, if the price breaks below the 20-day EMA, it will suggest that short-term traders may be selling near the overhead resistance. That could open the doors to a possible drop to the 50 simple moving average. If this support breaks, the drop could extend to $37,000.
MOON/USDT
Terra’s LUNA token rebounded from the 20-day EMA ($86) on March 18, indicating strong buying at lower levels. Both the moving averages are sloping up and the RSI is in the positive territory, which indicates an upside for the buyers.
If the buyers propel and sustain the price above $96, the LUNA/USDT pair could challenge the all-time high of $105. A breakout and close above this resistance will suggest a resumption of the uptrend. The pair could first rise to $115 and then to $125.
Alternatively, if the price turns below $96, the pair could drop back to the 20-day EMA. A break and close below this support will suggest that the upside momentum is weakening. The pair could then slide to the strong support zone at $75-$70.
The pair has been consolidating between $85 and $96. Although the bears had pushed the price below $85, they could not sustain the lower levels. This indicates strong buying on dips. Both moving averages intersect, which suggests a range-bound action in the short term.
If the price breaks above $96, the advantage will shift in favor of the buyers and the pair could rally to $105.
Conversely, if the price turns below $96, the pair could drop to the moving averages and then to $85. The bears will have to pull and hold the price below the $85-$82 support zone to signal the beginning of a deeper correction.
AVAX/USDT
Avalanche (AVAX) broke out and closed above the downtrend line of the descending channel on March 18, signaling a possible trend reversal. However, the bears have other plans and are currently trying to push the price back below the breakout level.
If the price turns down from the current level but bounces off the downtrend line of the channel, it will suggest that the breakout is valid. That raises the possibility of a rally to the psychological level of $100. The rising 20-day EMA ($78) and the RSI in the positive zone indicate an upside for the buyers.
Conversely, if the price re-enters the channel and breaks below the moving averages, it will indicate that the recent breakout was most likely a bull trap. That can catch several buyers off guard, resulting in a potential drop below the bullish level.
The 4-hour chart shows that the rise above the channel had pushed the RSI into overbought territory. This may have led to short-term profit-taking by traders. The pair could now drop to the 20 day EMA which is likely to act as a strong support.
If the price bounces off this level, it will suggest that the sentiment has turned bullish and traders are buying dips. That will increase the probability that the upward move will continue.
Conversely, a breakout and close in the channel will suggest that the upside momentum has weakened. That could take the pair to the 50 SMA.
ETC/USDT
Ethereum Classic (ETC) picked up momentum after it broke out and closed above the downtrend line. Strong buying has pushed the price close to the stiff overhead resistance of $38. The bears are likely to defend this level vigorously.
If the price turns down from the current level, the ETC/USDT pair could drop to $32. The 20-day EMA ($28) has started to turn up and the RSI is in the overbought zone, putting the upper hand with the buyers.
If the price does not give up much ground from the current level or rebounds sharply from $32, the bulls will again try to break above the $38 hurdle. If successful, the pair could rally to $45 and then $50.
Alternatively, if the price turns down and drops below $32, the next stop could be the 20-day EMA. A breakout and close below this level will suggest that the bears are back in the game.
The 4-hour chart shows that the pair embarked on a vertical rally after breaking out of the downtrend line. This pushed the RSI deep into overbought territory. These overbought levels are often followed by sharp declines.
The pair could drop to the 38.2% Fibonacci retracement level at $33 and then to the 50% retracement level at $32. The bulls are likely to defend this area aggressively. If the price bounces off this support zone, the buyers will try to push the pair above the overhead resistance and resume the uptrend.
The bullish momentum may weaken on a breakout and close below $32. Then the pair could drop to the 61.8% Fibonacci retracement level at $30.
EGLD/USDT
Elrond (EGLD) broke out and closed above the moving averages on March 15, which indicates that the bulls are trying to make a comeback. The bears have been trying to push the price back below the moving averages, but the bulls have thwarted their efforts.
The 20-day EMA ($151) has gradually started to turn up and the RSI has risen into the positive territory. This suggests that the path of least resistance is to the upside. If the buyers push the price above $169, the EGLD/USDT pair could extend its up move to the psychological $200 level. The bears are expected to mount a strong defense at this level.
This positive view will be invalidated if the price turns down and falls below the 20-day EMA. Such a move will suggest that the recent break above the 50-day SMA ($155) may have been a bear market rally. The pair could drop back to $125.
The bulls pushed the price above the overhead resistance at $160, but the bears quickly pushed the price down and tried to catch the aggressive bulls. Although the price broke below the 20-day EMA, the bears did not take advantage of this. This indicates strong buying at lower levels.
The bulls have pushed the price back above $160 and are trying to resume the up move. The bullish momentum could pick up on a break and close above $169. This positive view will be nullified if the price turns down and falls below $152.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should do your own research when making a decision.