Bitcoin (BTC), which continues to lose ground during December, is a sign that traders could be locking in gains before the end the year. There has not been a Santa rally on the U.S. equity market, indicating that traders are still cautious due to uncertainty about the spread of COVID-19 omicron variants in many parts of the globe.
Despite the steep drop in Bitcoin’s value, institutional investors still demand it. Data shows that the Grayscale Bitcoin Trust (GBTC), the largest institutional Bitcoin product is trading at a discount greater than 20%.
Everyday cryptocurrency market performance. Source: Coin360
Peter Brandt, a veteran trader, said that panic capitulations of high volume usually signify a bottom for Bitcoin. This has not happened in the current fall from the all-time peak. This could indicate that “real” capitulation has yet to occur.
Will Bitcoin and the major altcoins see a continued downtrend in the coming days? Or will Santa rally be the answer? Let’s look at the charts for the top 10 cryptocurrency coins to see what happens.
For the past few days the bulls have been defending a 200-day simple moving mean (SMA) of $47,130, but they have not been able push the price higher than the 20-day exponentialmoving average (EMA), which is $49,622. This indicates a lackluster demand at higher levels.
Daily chart of BTC/USDT Source: TradingView
The price fell below the 200-day SMA by the bears on December 20. If the price continues to fall below this critical level, selling could pick up. TheBTC/USDT currency pair could hit the $42,000-$39,600 support zone. Although the bulls will likely defend this area aggressively, the recovery could be hampered by the 200-day SMA.
If the price rises above the 20 day EMA, this negative view may be invalidated. This would suggest that the 200-day SMA break could have been a bear trap. The pair could then climb to $52,000, and then attempt to rally to $60,000.
For the past few days, Ether (ETH), has been trading in a downward channel. The channel bounced off its support line on Dec. 13, but failed to surpass the 20-day EMA ($4,058). This indicates that bears are selling on rallies.
Daily chart of ETH/USDT Source: TradingView
The relative strength index (RSI), below 43, and the downsloping 20 day EMA suggest that the path to the downside is the most likely. The pair ETH/USDT could fall to $3,643.73 before reaching the support line.
The channel could be extended for several more days by a strong rebound from the support line. The bulls will attempt to push the price higher than the channel. If they succeed, it will signal that selling pressure is decreasing.
If the price falls below the channel, bears may challenge the 200-day SMA ($3,288). Selling could be intensified if the price breaks or closes below this level.
The 100-day SMA ($509) was successfully defended by the buyers over the last few days, but Binance Coin (BNB), which is below the 20-day EMA ($552), could not be pushed above. This indicates that demand is drying up at higher levels.
Daily chart BNB/USDT TradingView
Bears are the winners, as evidenced by the downsloping 20 day EMA and negative zone RSI. The BNB/USDT pair may drop to the $243 level if the price breaks below the 100-day SMA.
Contrary to the assumption, if price rises above the 20 day EMA and goes up from current levels, it will indicate that bulls have absorbed the supply. This could lead to a rebound to $617, and then to the $669.30 overhead resistance.
Solana (SOL), which was down from the $20-day EMA ($183) Dec. 19, indicated that bears are defending it with vigor. A retest of 148.04 may be possible if the price falls below $167.88.
Daily chart of SOL/USDT Source: TradingView
This support is important to monitor as a break below it could cause the SOL/USDT pair ($120) to fall to the 200-day SMA ($120). Bears are in control of the market, as evidenced by the RSI at 43 and the 20-day EMA that is downsloping.
If the price rises above the 20-day EMA, this negative view will be invalidated. This would indicate that selling pressure is decreasing. The pair could rally to $200, and then to $240.
Cardano (ADA), which has bounced off of the strong support at $1.18 over the past few trading days, but the bulls haven’t been able push the price higher than the 20-day EMA ($1.35). This indicates a lackluster demand at higher levels.
Daily chart ADA/USDT Source: TradingView
The bears will now try to keep the price below $1.18. The ADA/USDT pair may drop below $1.18 if they succeed. This level is likely to be defended aggressively by the bulls.
A break above the 20-day EMA will signal strength. This will show that supply exceeds demand. The pair could rise first to $1.47, then rally to the overhead resistance at 1.87.
For the past few days, Ripple (XRP), has traded between $0.75 to $0.85. Although the bulls drove the price to $0.85 on December 20, the candlestick’s long wick suggests that bears are still selling on rallies.
Daily chart of XRP/USDT Source: TradingView
The RSI is showing signs that the bearish momentum might be slowing down. This could mean that the XRP/USDT pairs will remain within the range for at least a few days.
If the price breaks or closes above $0.85, it will be a sign that the bulls are winning. This could lead to the price reaching $1 psychologically. A break and close lower than $0.75 could allow for a drop to $0.60.
Terra’s LUNA token soared up to a new record high on Dec. 20, but the candlestick’s long wick suggests that traders who trade short-term may be making higher profits.
Daily chart of LUNA/USDT Source: TradingView
The bears will try to bring the LUNA/USDT price pair to the $20 EMA ($64) if it falls below $78.29. This support is important to monitor as a strong rebound from it will indicate that traders are buying dips and sentiment remains positive.
The bulls will attempt to push the price higher than the overhead zone of $78.29 to $91.87. The bulls could then push the price above the overhead zone at $78.29 to $81.87 and the pair could rally towards the psychological mark of $100.
If bears push the price below the 20 day EMA, it could indicate that traders are exiting positions. This could lead to the pair sinking to $50.
Related: 27% of all coins circulating are controlled by Bitcoin holders: Study
Avalanche (AVAX), bounced off strong support at $75.50 Dec. 14, and broke above the downtrendline Dec. 15. This indicates that bulls are trying to reestablish the uptrend.
Daily chart of AVAX/USDT Source: TradingView
The up-move has slowed from $119.69 Fibonacci retracement at 61.8%, which indicates that bears are selling rallies. Critical support has been reached at the $20 EMA ($99) for the AVAX/USDT pair.
The buyers will attempt to continue the upward movement if the price recovers from the current level. If the price breaks above $119.69, it could open the way for a rally up to $131.70, and then to the record $147.
However, if the price breaks below the 20-day EMA and continues to fall, the pair may drift towards the strong support at $75.50.
For the past few days, Polkadot has traded below the 200-day SMA (28.82 USD) This indicates that the bears are in control. The sellers are trying to lower the price below the strong support area at $25 to $22.66.
Daily chart of DOT/USDT Source: TradingView
If they can do so, the DOT/USDT pairing could continue its downward trajectory toward $16.81 as support. The greater chance of the downtrend continuing, the longer the price remains below the 200-day SMA.
Contrary to what is being assumed, bulls will attempt to push the pair higher than the 200-day SMA if the price bounces off the current zone. It will indicate that the bears have lost their grip. This could lead to the pair rising to $39.35.
Dogecoin (DOGE), which had rebounded from the strong support at $0.15 Dec. 14, soared above its 20-day EMA ($0.18), but the candlestick’s long wick shows that traders have sold at higher levels.
Daily chart of DOGE/USDT Source: TradingView
Dec. 15 saw the bears pull the price below the 20-day EMA. This could have trapped aggressive bulls, who might have been forced to sell their positions. This has pushed the price down to $0.15, the strong support.
If the support breaks, the price could fall to $0.13 at the Dec. 4 level. The psychological level of $0.10 could be reached if this support breaks. If the price rebounded from the current level, bulls will attempt to clear the overhead hurdle at $0.19 and the 20-day EMA.
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.