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Bitcoin’s bullish move above $19,300 is pulling select altcoins closer to their key overhead resistance levels.
Over the weekend Bitcoin (BTC) price made a push back above the $19,000 level as traders showed up and provided enough volume to support the surge.
At the time of writing, BTC price breaking above a pennant but the $19,300 to $19,500 range continues to present significant resistance. According to Cointelegraph contributor, Rakesh Upadhyay:
“If the bulls can push the price above the $19,500 to the $20,000 overhead resistance zone, it will complete an ascending triangle pattern that has a target objective of $22,808.98.”
As Bitcoin bulls attempt topush the price to the $19,500 resistance, a handful of altcoins have capitalized on BTC’s range-bound price action by rallying higher to key resistance levels.
Yearn.finance’s (YFI) governance token is currently showing an inverse head and shoulders formation on the 1-hour timeframe and as the price pushes at the neckline traders will look for a breakout to the $27,750 to $27,850 level.
Risk-averse traders will likely wait for a 1-hour close above the neckline at $26,276 before opening a position.
The 4-hour chart also shows a VPVR gap extending from $26,115 to $27,851 and the RSI has entered bullish territory above 50. In the event of a pullback, the 20-MA may provide support as it sits closely below at $25,468.
AAVE is also showing a similar construction to YFI except that it recently broke above the neckline of its inverse head and shoulders pattern to surge to a 5-day high at $91.78.
This move and the accompanying high volume surge triggered a bit of profit-taking but traders who take a quick glance at AAVE’s chart will notice that lower support retests frequently occur after the rallies like the one seen today.
Profit-taking led to the price retesting the $85.50 support and if this level can hold and Bitcoin doesn’t breakdown from its pennant, AAVE price will likely reclaim $88.30. A daily close above $91.78 will open the door to AAVE securing a new all-time high above $94.90.
Another altcoin quietly making strong moves is Elrond (EGLD) which has rallied 75% since completing a rounding bottom on Dec. 7. Currently, EGLD is up 10.5% today and after topping out at $20.12 the altcoin is pulling back to retest underlying support levels.
There is support at $17.42, and below this at $16.80 where the 20-MA resides and the volume profile visible range shows support.
While the 4-hour chart suggests that the bullish move has ended, the daily timeframe shows EGLD on the verge of overtaking the Sept. 4 high at $20.50, after which there is no overhead resistance and the possibility of a new all-time high above $35.
If Bitcoin price successfully breaks above $19,500 and flips the level to support it’s likely that YFI, AAVE and Elrond will follow in tandem.
The views and opinions expressed here are solely those of the author