In the last few days, Bitcoin’s (BTC), volatility has been decreasing. The Bitcoin Volatility Index calculates the standard deviation of daily Bitcoin returns over the past 30 and 60 days. This is the lowest volatility it has been since November 2020.
In general, strong price increases follow tight ranges. The low volatility period of November 2020 was followed by a sharp rally mid-December which led to a supercycle that saw the price rise all the way up to $64,854 in April 2021.
Everyday cryptocurrency market performance. Source: Coin360
There is no guarantee that volatility expansions will be limited to the upside. It is possible for the price to move in any direction. Vince Prince, a commentator on Bitcoin, warned that the high leverage ratio could cause a large chunk of stop-losses in the event of the $40,000 support breaking down.
Is Bitcoin on the verge of a new up-move? Or will bears push the price down below support levels, triggering an altcoin sell-off? Let’s look at the charts for the top 10 cryptocurrency coins to see what happens.
Bitcoin traded near the 20-day exponentially moving average (EMA), ($44,181) over the past few trading days. Although the resistance has not been broken, it is a positive that bulls have not lost much ground.
Daily chart of BTC/USDT Source: TradingView
If the price rises above $41,725.95, then the bulls will attempt to break the overhead resistance at the 20 day EMA and horizontal resistance at $45,456.
If they achieve that, the pair could reach the 50-day SMA (47,680), where the bulls will likely face stiff resistance from bears. The pair could reach $52,088 if it breaks and closes above this resistance.
However, if the price falls below $41,725.95 the BTC/USDT exchange could fall to $39,600. This is an important level that the bulls must defend as selling could intensify and the pair could plummet towards $30,000.
The recovery of Ether (ETH) from the support line in the descending channel slowed to the $20-day EMA ($3,439). This suggests that traders are still selling rallies and sentiment is negative.
Daily chart of ETH/USDT Source: TradingView
The bears will attempt to bring the price down below $3,188. The ETH/USDT pair may drop to $2,928.83 if they succeed. This support is important to monitor because it could collapse and cause a decline of up to $2,652.
Contrary to the assumption, if the price rises above the current level and crosses above the 20-day EMA then the bulls will push the pair higher than the resistance line. The pair could reach $4,200 if that happens.
Binance Coin (BNB), failed to breach the resistance line for the descending channel pattern. This could have prompted short-term traders to sell, bringing the price below $488, the 20-day EMA.
Daily chart BNB/USDT TradingView
The BNB/USDT pair may fall towards the channel’s support line if bears push the price below $466.50. The equilibrium between bulls and bears is indicated by the flat moving averages, and the RSI just above the midpoint.
The bulls will attempt to push the price higher than the channel and the 50 day SMA ($530) if the price rebounded from $466.50. It will indicate a possible shift in trend if they succeed. The pair could rally to $572.
Cardano (ADA), broke and closed above $1.34 on Jan. 16. This indicates that bulls are trying to make a comeback. The resistance line in the descending channel could be reached now.
Daily chart ADA/USDT Source: TradingView
The moving averages appear to be on the brink of a bullish crossover, and the RSI is in the positive zone. This indicates that bulls have the upper hand short-term. It will indicate a shift in trend if buyers push and maintain the price above this channel.
The ADA/USDT currency pair could rally to $1.87, and if that level is reached, then the next move could take place to $2.47. The pair could also drop back to the moving averages if it moves below the resistance line.
Solana (SOL), continues to trade within the descending channel pattern. On Jan. 13, the bulls tried to push the price higher than the 20-day EMA ($154), but they failed. This indicates that bears sell on every minor rally.
Daily chart of SOL/USDT Source: TradingView
The bears will attempt to lower the price below $130. The SOL/USDT pair may drop to $116 if they succeed. This level is crucial for bulls to protect as a break below could cause the pair to fall to the support line.
Contrary to popular belief, if the price rises from its current level and crosses above the 20-day EMA then the channel’s resistance line could be reached. A possible trend change will be signaled by a break or close above the channel.
Ripple (XRP), traded between the 20-day EMA ($0.79), and support at $0.75. The range expansion is likely to end this squeeze.
Daily chart of XRP/USDT Source: TradingView
The XRP/USDT currency pair could resume its downward trend if the price falls below $0.75. This would lead to a drop to $0.69 and then a fall to $0.60. Bears have an advantage because of the RSI in negative territory and the downsloping moving Averages.
Contrary to the assumption, if the price rises above $0.75 and crosses the moving averages it will indicate accumulation at lower levels. The pair could then begin its northward march towards the stiff overhead resistance of $1.
Terra’s LUNA token couldn’t rise above the 61.8% Fibonacci retracement point at $87.88 on January 15 and 16. This could have led to short-term bulls profit-booking.
Daily chart of LUNA/USDT Source: TradingView
The 20-day EMA ($80.17) has been lowered, which could be a support. The bulls will attempt to keep the LUNA/USDT price above $87.88 if the price rises from its current level.
The pair could rally to $94.80 Fibonacci level if they succeed. If the price falls below the moving averages, traders may be rushing to exit. This could lead to a drop in the pair to $68.33
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Polkadot’s (DOT) price rose above the 20 day EMA ($26.90), but the bulls couldn’t push it above the 50-day SMA ($28.15). This could have attracted profit booking from short-term traders.
Daily chart of DOT/USDT Source: TradingView
On Jan. 17, the bears brought the price below the 20-day EMA. The strong support of $22.66 could be reached if sellers lower the price to $25.45.
The 20-day EMA remains flat while the RSI is just above the midpoint. This indicates a balance between supply/demand. The pair could be range bound between $22.66 to $32.78 for a few days more.
The pair could rise to $32.78 if the price moves up from its current level and above the 50-day SMA. This hurdle will be cleared by the bulls to signal a new up-move.
The Avalanche (AVAX), which was lower than the 20-day EMA ($95), on Jan. 16 indicates that bears are continuing to defend this level aggressively. The next stop for the bears could be $75.50 if the price continues to fall below the uptrend line in the symmetrical triangle.
Daily chart of AVAX/USDT Source: TradingView
The RSI in negative zone and the downsloping moving Averages indicate that bears hold the upper hand. A close below $75.50 could signify a descending triangle pattern. This could indicate the beginning of a new downtrend.
The AVAX/USDT exchange rate could fall to $57.02 and then drop to $50. If the price rises above the downtrend line, this negative view will be invalidated. The price could rally to $128.
Dogecoin’s (DOGE), failure to rise above $0.19 overhead resistance on January 15 may have attracted profit booking from short-term traders. This has caused the price to fall to $0.16 at the 20-day EMA.
Daily chart of DOGE/USDT Source: TradingView
A consolidation signal is expected in the near-term, as the flattening 20 day EMA and the RSI just above the midpoint indicate a solid foundation. The DOGE/USDT pair may drop to $0.13 if bears continue to sink below the moving averages.
If the price bounces off its current level, bulls will attempt to push the pair higher than $0.19. It will signal the beginning of a new up-move if they succeed.
Risk is inherent in every investment or trading move. Before making any investment or trading move, you should do your research.
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Eileen Wilson –Technology and Energy
My Name is Eileen Wilson with more than 5 years of experience in the Stock market industry, I am energetic about Technology news, started my career as an author then, later climbing my way up towards success into senior positions. I can consider myself as the backbone behind the success and growth of topmagazinewire.com with a dream to expand the reach out of the industry on a global scale. I am also a contributor and an editor of the Technology and Energy category. I experienced a critical analysis of companies and extracted the most noteworthy information for our vibrant investor network.