Market analysis for BTC, ETH, DOT, XRP, ADA, LINK, LTC, BCH, BNB, XLM

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The dip in Bitcoin below $30,000 sparked a sell-off in altcoins and does not have enough traction for dip-buying traders to spark a relief rally

In the past year, public corporations have bought over 85,000 Bitcoin (BTC) and retail investors have poured capital into Grayscale Investments, one of the key factors for the latest Bitcoin boom, which indicates rising institutional acceptance.
For the moment, though, it appears like institutional investors are unlikely to be seeking higher rates. It could result in a pullback in Bitcoin’s price if the fresh inflow of capital stalls or decreases significantly. Short-term traders and momentum players will book gains and spark a deeper correction if that happens.

 

Daily cryptocurrency market performance. Source: Coin360

As it will shake out the speculators and only the long-term HODLers will be left on the market, a correction will be a healthy sign. Additional institutional investors can continue to purchase at lower levels as the price declines. The transition from speculators to long-term investors in Bitcoin’s ownership would be beneficial in the long term.

If Bitcoin enters a deeper short-term correction, it is possible that other altcoins will follow suit.

To decide the support thresholds where investors can move in, let’s review the charts of the top-10 cryptocurrencies.

 

BTC/USD

Bitcoin broke above the 20-day exponential moving average ($33,254) on Jan. 25 but the traders used this rise to sell, which pushed the price down to the $30,450 support on Jan. 26. The bulls purchased this dip but could not push the price above the 20-day EMA.

BTC/USDT daily chart. Source: TradingView

The BTC/USD pair has resumed its correction today, which shows the bulls are not able to absorb the supply. The downsloping 20-day EMA and the relative strength index (RSI) in the negative zone suggest bears are in control.

If the bears can sink and sustain the price below the 50-day simple moving average ($29,407), the pair will complete a bearish descending triangle pattern. This could result in a drop to the 50% Fibonacci retracement level at 25,897.42 and then to the 61.8% retracement level at $22,106.73.

This bearish view will invalidate if the price rebounds off the current level and breaks above the downtrend line. If that happens, the pair may rally to $40,000 and then to $41,959.63.

ETH/USD

Ether’s (ETH) inability to sustain above $1,400 on Jan. 25 shows the bears were booking profits at higher levels. The bulls again attempted to regroup on Jan. 26 but the altcoin has turned down today, which suggests traders may be closing their long positions.

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ETH/USDT daily chart. Source: TradingView

The negative divergence on the RSI shows the momentum has weakened. If the bears can pull the price below the 20-day EMA ($1,211), a retest of the uptrend line is likely. This is an important support to watch out for because a break below it will signal a possible trend change. The next support on the downside is the 50-day SMA ($928).

On the other hand, if the bulls can sustain the current rebound, it will suggest that the bulls are buying on dips. If the bulls can push the ETH/USD pair above the $1,400 to $1,473.096 resistance zone, the uptrend could resume with the next target objective at $1,675.

DOT/USD

Polkadot (DOT) turned down from the overhead resistance on Jan. 25 and dropped to the $14.7259 support today. The bulls are likely to defend this support aggressively.

DOT/USDT daily chart. Source: TradingView

A quick $14,7259 turnaround will mean that traders are collecting dips. That could keep the range-bound DOT/USD pair between $14,7259 and $19.40 for a few more days. The steadily increasing 20-day EMA and RSI in the positive territory show a small advantage for the bulls.

On the opposite, the fall can stretch to the 50 percent Fibonacci retracement level at $13,2821 and then to the 61.8 percent retracement at $11,8383 if the bears lower the price below $14,7259. The uptrend has lost traction and that could result in a few days of stabilization before the next trend change begins, a deeper correction would indicate.

 

XRP/USD

After defending the 20-day EMA ($0.28) for the past few days, the bears are currently attempting to sink XRP below the $0.245 support. The downsloping moving averages and the RSI in the negative territory suggest the path of least resistance is to the downside.

XRP/USDT daily chart. Source: TradingView

A break below $0.245 will increase the possibility for a fall to the next critical support at $0.17351. If this support also cracks, the XRP/USD pair could resume the downtrend with the next possible stop at $0.10.

On the contrary, if the pair rebounds off the current level, the bulls will again try to push the price above the downtrend line. If they manage to do that, the pair could remain range-bound between $0.245 and $0.3855 for a few more days.

ADA/USD

Cardano’s (ADA) strong recovery on Jan. 22 fizzled out at $0.3685714 on Jan. 24, suggesting traders used the rally above $0.34 to close their long positions.

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ADA/USDT daily chart. Source: TradingView

The bulls are currently defending the support line of the ascending channel. A strong bounce off this level will suggest the bulls are buying on dips. The bulls will then try to push the price above the downtrend line, which will be the first indication that the correction may be over.

If the price sustains above the downtrend line, a retest of $0.3971995 could be on the cards. Conversely, if the bears sink the price below the support line, it will suggest a possible trend change that could result in a drop to the 50-day SMA ($0.23).

LINK/USD

Chainlink (LINK) is currently witnessing a correction in an uptrend. The first critical support to watch on the downside is the 20-day EMA ($20.15), which is near the breakout level at $20.1111.

LINK/USDT daily chart. Source: TradingView

A quick bounce from this help would suggest that the bulls are accumulating actively at lower levels. After raising the price past the latest all-time peak at $25.7824, they will then aim to restart the upward trajectory.

Contrary to this hypothesis, if the bears drops below the 20-day EMA price, the LINK/USD pair might drop to $17,7777. A fall below this support would signify a pattern shift and which pull the price down to the SMA 50-day ($15.58).

 

LTC/USD

Litecoin (LTC) turned down from the 20-day EMA ($139) on Jan. 25, which suggests the bears are selling on relief rallies. The bulls purchased the dip to the 50-day SMA ($128) on Jan. 26 but could not push the price above the 20-day EMA.

LTC/USDT daily chart. Source: TradingView

Renewed selling has dragged the LTC/USD pair below the 50-day SMA today and the bears will now try to break the $120 support. If they manage to do that, the pair will complete a bearish head and shoulders pattern that may result in a fall to $100 and then to $70.

The downsloping 20-day EMA and the RSI in the negative zone suggest the path of least resistance is to the downside. This negative view will be negated if the pair rebounds off the $120 support and rises above $148.

BCH/USD

On Jan. 25, Bitcoin Cash (BCH) struggled to stay above the 20-day EMA ($443) and that may have drawn sales from the bears that today pulled the market below the 50-day SMA ($389).

BCH/USD daily chart. Source: TradingView

In the negative territory, the downsloping 20-day EMA and the RSI say the direction of least resistance is to the downside. A fall below the $370 support could bring down the market to $353 and the next stop could be $275 if that amount also cracks.

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If the BCH/USD pair bounces off the current level or the $353 support and increases over $450, this bearish view will be invalidated.

 

BNB/USD

On Jan. 25, Binance Coin (BNB) did not keep above $43,0992, suggesting a shortage at higher levels of buyers. On Jan. 25 and 26, the altcoin formed a Doji candlestick pattern that revealed indecision among the bulls and bears.

BNB/USDT daily chart. Source: TradingView

By sinking the price below the support line of the ascending expanding wedge trend, the sellers are trying to win the upper hand. The BNB/USD pair will drop to $35.69 if they succeed, and then to $30.

Contrary to this belief, it would imply demand at lower levels if the bulls will protect the support line. Then the bulls will aim to drive the market beyond $43.0992 again. The pair can ascend to $47,2187 if they can continue to do that.

The flattish 20-day EMA ($40.99) and the RSI close to the midpoint do not lend either the bulls or the bears a strong edge.

 

XLM/USD

The inability of the bulls to lift Stellar Lumens (XLM) beyond $0.282 could have drawn short-term traders who bought the dip on Jan. 22 for profit-booking. On Jan. 25, the altcoin shifted down and broke through the 20-day EMA ($0.261)

XLM/USDT daily chart. Source: TradingView

It indicates a shift of mood as the market struggles to build up traction above the 20-day EMA. The present decline suggests that the latest relief surge was used by traders to lighten their positions.

Now, the XLM/USD pair will drop to the SMA of 50 days ($0.214), which will draw some dip buying. But if the pair struggles to recover with intensity off this help, the correction could intensify, and could be on the cards a decline to $0.19 and then to $0.15.

 

-cointelegraph

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