Bitcoin and some altcoins are attempting to break through key resistance levels, but negative news and BTC miner sales could continue to weigh on market sentiment.
Bitcoin (BTC) is attempting to break above the psychological level of $20,000 on July 6, a sign that the bulls are attempting to rein in the brutal bear market. Retail traders are making the most of the current downturn and are on a buying spree. Proof of this is the data from Glassnode, which shows that wallets with less than one Bitcoin made 60,460 Bitcoin in June, at the “most aggressive pace in history”.
In a recent report, Glassnode analysts said that activity on the Bitcoin network shows that “all speculative entities, and market tourists have been completely purged from the asset.” This means that, for the most part, it is the long-term investors who stay with Bitcoin.
However, not everyone is optimistic about the prospects for Bitcoin in the short term. According to Arcane Research, the ProShares Short Bitcoin Strategy ETF (BITI), the first exchange-traded fund (ETF) to “short” Bitcoin, has increased its short exposure “by more than 300% in the past week.”
Could the avalanche of the first inverse Bitcoin ETF act as a contrarian signal indicating the formation of a possible bottom? Let’s study the charts of the top 10 cryptocurrencies to find out.
BTC/USDT
Bitcoin is trading inside a symmetrical triangle pattern. The buyers tried to push the price above the resistance line of the triangle on July 5, but the bears held their ground.
The Doji candlestick pattern for July 5 shows indecision between buyers and sellers. This uncertainty could tip in favor of the bulls if the price breaks above the triangle. If that happens, it will suggest that the triangle may have acted as a reversal pattern.
The BTC/USDT pair could then rally towards the 50-day simple moving average (SMA) ($25,324) and then the pattern target of $26,490.
This assumption could prove incorrect if the price turns down from the current level and falls below the support line of the triangle. That could carry the price to the critical support of $17.622. If this support collapses, the next stop could be $15,000.
ETH/USDT
Ether (ETH) attempted a rally above the 20-day EMA ($1,186) on July 5, but the bears had other plans. The price action of the past few days has formed an ascending triangle pattern that will complete on a breakout and close above $1,280.
If the buyers push the price above the 20-day EMA, the possibility of a break above $1,280 increases. If that happens, the ETH/USDT pair could rally to the 50-day SMA ($1,500) and then to the pattern target of $1,679.
Conversely, if the price turns down from the 20-day EMA and breaks below the support line, it will suggest that the bears are still in command. That could take the pair to the crucial support of $881. A break and close below this support could signal the start of the next leg of the downtrend.
BNB/USDT
The bulls pushed BNB above the 20-day EMA ($232) on July 5, but the bears posed a strong challenge at higher levels. A positive sign is that the bulls did not give up much ground and again pushed the price above the 20-day EMA on July 6.
The 20-day EMA has flattened out and the RSI is close to the midpoint, which indicates that the bears may be losing control.
If the buyers sustain the price above the 20-day EMA, the BNB/USDT pair could start its recovery to the 50-day SMA ($264). This level can again act as a resistance, but if the bulls break through this barrier, it will suggest that the pair may have bottomed out at $183.
Contrary to this assumption, if the price turns down from the current level or the 50-day SMA, it will indicate that the bears continue to sell at higher levels. Afterwards, the bears will try to push the price to $211.
XRP/USDT
Ripple (XRP) is stuck between the 20-day EMA ($0.33) and the support line of the symmetrical triangle pattern. Although the price rebounded from the support line on July 5, the bulls are struggling to clear the overhead resistance at the 20-day EMA.
The 20-day EMA continues to decline gradually and the RSI is in the negative zone, which indicates that the bears have the upper hand. Sellers will try to sink the price below the support line. If they manage to do that, the XRP/USDT pair could slide to the critical support at $0.28.
Contrary to this assumption, if the price breaks out of the current level or the support line and breaks above the 20-day EMA, the pair could rally to the resistance line of the triangle. A breakout and close above this level could signal the start of a rally to $0.48.
ADA/USDT
Cardano (ADA) remains between the 20-day EMA ($0.47) and $0.44, but this tight range trading is unlikely to continue for long. Usually narrow ranges lead to range expansions.
The first sign of strength will be a breakout and close above the 20-day EMA. That could open the doors for a break above the important resistance at the 50-day SMA ($0.51). If that happens, the ADA/USDT pair could rally to $0.60.
Another possibility is that the price turns down and drops below $0.44. That will indicate an advantage for the bears. The pair could then slide down to the critical $0.40 support. If this level gives way, the pair could resume its downtrend.
SOL/USDT
Solana (SOL) broke above the 20-day EMA ($36) on July 4, but the bulls could not maintain the momentum. The bears pushed the price back below the 20-day EMA on July 5.
The long tail of the July 5 candle shows strong buying at lower levels. This increases the probability of a breakout above the moving averages. If that happens, the SOL/USDT pair could rally to $43. A breakout and close above this level could clear the way for a possible rally towards the psychological resistance at $50.
This positive view could be nullified in the short term if the price turns down from the current level or the 50-day SMA ($39) and breaks below $30. That could send the pair down to $26.
DOGE/USDT
Dogecoin (DOGE) has been hovering close to the 20-day EMA ($0.07) for the past few days. This indicates uncertainty between buyers and sellers.
The flat 20-day EMA and the RSI just below the midpoint do not give a clear advantage to either the bulls or the bears. A breakout and close above the 50-day SMA ($0.07) could be the first indication that the buyers have the upper hand.
The bullish momentum could pick up on a break above $0.08. The DOGE/USDT pair could rally towards the psychological $0.10 level.
Another possibility is that the price turns down from the current level and breaks below $0.06. That will indicate an advantage for the bears and the pair can slide to $0.05.
DOT/USDT
The bulls were unable to push Polkadot (DOT) above the immediate resistance of $7.30 on July 4. This suggests that the price remains stuck inside the range between $7.30 and $6.36.
The failure of the bears to break the price down to the $6.36 range support shows that the bulls are not waiting for a deeper drop to buy. This increases the possibility of a breakout above the overhead resistance. If that happens, the DOT/USDT pair could rally to the 50-day SMA ($8.48). The bears are likely to defend this level aggressively.
Alternatively, if the price turns down and drops below $6.36, it will indicate a resumption of the downtrend. Then the pair could slide towards the psychological support at $5.
SHIB/USDT
Shiba Inu (SHIB) broke above the 50-day SMA ($0.000010) on July 5, but the long wick of the candle shows that the bears are selling higher. A minor positive is that the bulls are not allowing the price to drop back below $0.000010.
Both moving averages have flattened out and the RSI is close to the midpoint. This does not give a clear advantage to either the bulls or the bears.
If the price turns up and breaks above $0.000011, the SHIB/USDT pair could rally to $0.000012, where the bears can once again mount a strong defense. The bulls will have to overcome this hurdle to open the doors for a potential rally to $0.000014.
Alternatively, if the price turns down and drops below $0.000009, it will suggest that the bears are back in control. That could improve the prospects for a retest of the critical support at $0.000007.
LEO/USD
UNUS SED LEO (LEO) continues to oscillate near the resistance line of the descending channel as both the bulls and bears try to gain the upper hand.
Once again, the price rebounded from the 20-day EMA ($5.66) on July 5, which indicates that the bulls continue to defend the level aggressively. The bullish momentum could increase if the bulls push and close the LEO/USD pair above $6. If that happens, the pair could rally to $6.50 and then the pattern target of $6.90.
Conversely, if the price turns down and closes below the 20-day EMA, it will indicate that the bears have overpowered the buyers. That could take the pair to the 50-day SMA ($5.33).
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.
Market data is provided by the exchange HitBTC .