Bitcoin and some of the major altcoins have risen from their recent lows, indicating an increase in short-term volatility.
Bitcoin (BTC) rose to the 200-week moving average on July 8, a level that could act as a battleground between bulls and bears. Several analysts are watching this level because a break and close above it could be the first sign that the bear market could be coming to an end.
Bloomberg Senior Commodity Strategist Mike McGlone said that Bitcoin’s 50- and 100-week moving averages show similar signs to those seen before the bottom of the 2018 bear market. Therefore, McGlone expects Bitcoin to give a strong rebound in the second half of 2022.
Another positive sign is that Bitcoin broke above $22,000 on July 8, even as the US Dollar Index (DXY) continued its march north. This suggests that the strong inverse correlation between Bitcoin and DXY may be starting to weaken.
Could Bitcoin Extend Its Recovery Lifting Crypto Markets? Let’s study the charts of the top 10 cryptocurrencies to find out.
BTC/USDT
Bitcoin broke above the resistance line of the symmetrical triangle and the 20-day EMA ($21,233) on July 7, signaling that the bulls are making a comeback.
The flattening of the 20-day EMA and the relative strength index (RSI) just below the midpoint suggest that the selling pressure may be easing.
If the price bounces off the current level or the breakout level of the triangle, it will suggest that the sentiment has turned positive and traders are buying the dips. That could raise the possibility of a rally to the 50-day simple moving average (SMA) ($25,015) and then to the pattern target of $26,490.
This positive view could be invalidated in the short term if the price breaks back below the 20-day EMA and re-enters the triangle. That will indicate aggressive selling by the bears at higher levels. The pair could then drop to the support line of the triangle.
ETH/USDT
Ether (ETH) broke above the 20-day EMA ($1,198) on July 7 and reached the overhead resistance at $1,280 on July 8. The bears are defending this resistance aggressively and are attempting to sink the price back below the 20-day EMA.
If they do, the ETH/USDT pair could drop to the support line of the ascending triangle. This is an important level to watch because a break and close below it could invalidate the bullish setup. That could push the price down towards the critical support at $881.
Conversely, if the price bounces off the 20-day EMA and breaks above $1,280, it will complete the bullish ascending triangle pattern. The pair could then rally to the 50-day SMA ($1,470) and then rally to the pattern target at $1,679.
BNB/USDT
BNB broke out and closed above the 20-day EMA ($233) on July 6, but the bulls are struggling to push the price towards the 50-day SMA ($262). This suggests that the bears are active at higher levels.
The sellers are trying to push the price back below the 20-day EMA. If they can pull it off, the BNB/USDT pair could slide to the strong support at $211.
On the other hand, if the price bounces off the 20-day EMA, it will suggest that the sentiment is turning positive and the bulls are buying the dips. Then the bulls will try to push the price above the 50-day SMA and gain control. That could clear the way for a potential rally to $300.
XRP/USDT
Ripple (XRP) attempted a breakout above the resistance line of the symmetrical triangle, but the bears had other plans. They aggressively defended the level and are trying to sink the price below the 20-day EMA ($0.33).
If they are successful, the XRP/USDT pair could extend its stay inside the triangle even longer. The flat 20-day EMA and the RSI near the midpoint do not give a clear advantage to either the buyers or the sellers.
A breakout and close above the triangle could signal the start of a new move higher. Afterwards, the pair could rally to the pattern target of $0.48. Alternatively, a break below the triangle could open the doors for a retest of $0.28.
ADA/USDT
Cardano (ADA) broke above the 20-day EMA ($0.47) on July 8, but the bulls were unable to sustain the higher levels. This indicates that the bears are aggressively defending the moving averages.
The sellers will try to take advantage of it by pulling the price below the strong support at $0.44. If they manage to do that, the ADA/USDT pair could drop to the important level of $0.40. A breakout and close below this support could signal the start of the next leg of the downtrend.
To invalidate this bearish view, the buyers will have to push and sustain the price above the 50-day SMA ($0.51). If they manage to do that, the pair could rally to $0.60 and then $0.70.
SOL/USDT
The buyers attempted to push Solana (SOL) above the 50-day SMA ($38.79) on July 5-6, but were unable to break above the barrier. This suggests that the bears are selling on the rallies.
The price is compressing inside a symmetrical triangle. This points to a possible range expansion in the near term. If the price turns down and breaks below the triangle, the SOL/USDT pair could slide towards the critical support at $26.
Conversely, if the price turns up and breaks above the resistance line of the triangle, it will suggest that the bulls have the upper hand. Then, the pair could rally to the psychological level of $50, where the bears can once again mount a strong defense.
DOGE/USDT
Dogecoin (DOGE) attempted to break above the 50-day SMA ($0.07) on July 8, but the bears did not budge. The sellers are trying to take the opportunity to sink the price below the 20-day EMA ($0.07).
The RSI is close to the midpoint and the 20-day EMA has leveled off, which suggests a balance between buyers and sellers. This balance could tip in favor of the bulls if they push and hold the price above the 50-day SMA. Such a move could clear the way for a rally to $0.08 and $0.09 next.
Conversely, if the price turns down and drops below $0.06, the bears will endeavor to push the DOT/USDT pair to the vital support of $0.05.
DOT/USDT
Polkadot (DOT) attempted to break above the overhead resistance at the 20-day EMA ($7.38) on July 7, but the bears held their ground. This indicates that the bears are active at higher levels.
The bears will try to push the price towards the critical support of $6.36. This is important support for the bulls to watch out for because a break and close below it could signal a resumption of the downtrend. The DOT/USDT pair could then drop to the psychological level of $5.
This negative view could be invalidated if the price breaks out and breaks above the 20-day EMA. If that happens, the pair could attempt a rally to the 50-day SMA ($8.38). This level can once again act as a resistance, but if the bulls break through this hurdle, it can signal a possible trend reversal.
SHIB/USDT
Narrow range trading in Shiba Inu (SHIB) resolved to the upside on Jul 7 as the price broke through the immediate resistance at $0.000011. The bears attempted to sink the price below $0.000011 on Jul 8, but the long tail of the candle indicates strong buying on the dips.
The buyers will try to push the price above the strong resistance of $0.000012. If they are successful, it will indicate a demand at higher levels. The SHIB/USDT pair could rally to $0.000014, where the bears can once again pose a strong challenge.
Conversely, if the price turns down from the current level and sustains below $0.000011, it will suggest that the breakout on July 7 may have been a bull trap. Afterwards, the bears will try to push the price back below the critical support at $0.000010. If that happens, the next stop could be $0.000009.
AVAX/USDT
Avalanche (AVAX) has been trading between $13.71 and $21.35 for the past few days, which indicates a bottom formation. The 20-day EMA ($18.78) has leveled off and the RSI is just above the midpoint, which indicates a balance between the bulls and the bears.
If the buyers push the price above the overhead resistance at $21.35, it will signal the start of a new move higher. The AVAX/USDT pair could rally to the pattern target of $29, where the bears can once again mount a strong resistance. If the price turns down from this level but does not drop below $21.35, it will suggest that a bottom may have been reached at $13.71.
Contrary to this assumption, if the price turns down from the current level and breaks below the 20-day EMA, it will indicate that the range bound action may continue for a few more days.
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 .