The Dow Jones Industrial Average fell for eight consecutive weeks. This is the first losing streak of its kind since 1923. The S&P 500 briefly fell to bear market territory on May 20. This indicates that traders continue selling risky assets in the fear of a recession.
Bitcoin (BTC), due to its close correlation with US equities markets has been under pressure for many week. The bulls will attempt to push Bitcoin higher this weekend, and avoid a longer losing streak.
Daily view of crypto market data. Source:Coin360
The performance of Bitcoin in the first five month has been the worst since 2018. This indicates that sellers are in control. However, crypto markets could be poised for a bear market rally after several weeks of weakness.
What are the key levels that could signal a sustainable recovery? Let’s look at the charts of top-5 cryptocurrency that could outperform in near future.
Bitcoin recovered from the critical support level at $28,630 on 25 May, indicating that there was strong buying around this level. The bulls are trying to push the price higher than the downtrend line. This could be the first sign that selling pressure is decreasing.
Daily chart of BTC/USDT Source: TradingView
The BTC/USDT pair could move above the downtrend line to the 20-day exponential moving mean ($31,887). This level will be defended by the bears. If the price drops below the 20-day EMA the bears will attempt to sink the pair below $28,630.
The pair could fall to $26,700 if they can do so. This is an important level that you should be watching because a break or close below it could lead to a decrease to $25,000, and then to $21,800.
If buyers push the price higher than the 20-day EMA, then the pair may attempt a rally to $34,823, which is the 61.8% Fibonacci retracement level. The pair could reach the simple moving average of $37,289.
BTC/USDT 4-hour chart. TradingView
The 4-hour chart shows the price getting squeezed between $28,630 and the downtrend line. The 20-EMA has flattened and the 50 SMA has fallen. The relative strength index (RSI), is just above its midpoint, suggesting a balance in supply and demand.
If buyers push the price higher than the downtrend line, this balance could tip in their favor. The pair could then move northward towards the 200-SMA.
The bears will try to lower the pair below $28,630 if the price drops from its current level.
Binance Coin (BNB), which has risen sharply from $211 as a critical support, has now reached overhead resistance at $205 EMA ($323). This is an important level that bears should defend as a break or close above could signal that there may be a bottom.
Daily chart BNB/USDT TradingView
The BNB/USDT pairing could rally above the 20-day EMA to $350, and then to the 50 day SMA ($376). Although this level can be a barrier, bulls could push the price higher than it to allow the pair to rally to the 200 day SMA ($451).
Contrary to popular belief, if the price drops sharply below the 20-day EMA it will indicate that bears are not giving up on the market and continue selling at higher levels. The price could drop to $211. The price could drop to $211.
BNB/USDT 4-hour chart. Source: TradingView
Bulls are trying to push the price higher than the overhead resistance of $320. The pair could rally to $350 if they succeed. This level is likely to be defended by the bears. The pair could drop to $320 if the price drops below $350.
The price could rebound from this level and the pair may remain range-bound between $220 and $350 for a while. Bullish momentum could rise above the 200-SMA, and the pair could rally to $380 or later to $400.
If the price drops from its current level, it could drop to $286, and then to $272.
Monero (XMR), which fell below $134 as strong support on May 12, but bears couldn’t sustain lower levels, This indicates that aggressive buying is possible on dips. The price is now at the $20-day EMA ($179).
Daily chart of XMR/USDT Source: TradingView
Bulls pushing and maintaining the price above the 20 day EMA could cause the XMR/USDT to rise to the overhead resistance zone of the 200-day SMA ($202), and the 50-day SMA (212). This zone is expected to be defended by the bears.
It will indicate a possible change in trend if the price moves down from this area but the bulls stop the decline at the 20 day EMA. If the price drops below the current level, bears will attempt to pull the pair down to $150, and then to $134.
XMR/USDT 4-hour chart. Source: TradingView
The formation of higher lows, and higher highs is evident in the 4-hour chart. Although the bears attempted to lower the price below 50 SMA, the bulls held firm. This indicates a shift in sentiment from buying on rallies to selling on dips.
The bears could offer strong resistance and the pair could rally to the 200 SMA. The pair could rise to $225 if bulls can overcome this barrier. This assumption is incorrect. The pair could slip to $150 if the price falls below the 50-SMA. If the price falls below $134, it could threaten the support at $134.
Related: Lump-sum or Dollar Cost Averaging: Which Bitcoin strategy is best regardless of the price?
Ethereum Classic (ETC), dropped sharply from $52 March 29 to $16 May 12. The bulls are trying to begin a recovery, but could be stopped by resistance at the $20-day EMA (23).
Daily chart ETC/USDT Source: TradingView
If the price falls below the 20-day EMA the bears will attempt to reestablish the downtrend by pulling down the ETC/USDT pairs below $16.
However, if buyers push the price higher than the 20-day EMA it will signal the beginning of a stronger relief rally. Positive divergence in the RSI suggests a possibility of a near-term recovery. The pair could then reach the 38.2% Fibonacci level at $30, where bears might mount a strong resistance.
ETC/USDT 4-hour chart. Source: TradingView
For some time, the price has traded between $19 to $23. The bulls may be trying to make a lower low, but the bears remain a formidable challenge at higher levels. Bulls and bears are not at an advantage due to the flattening 20-EMA or 50-SMA.
It will signal a new up-move if buyers push the price higher than $23. The price could rally first to the 200-SMA, then to $33. The bears could also win if the price falls below $19 and the pair rallies to the 200-SMA. They will attempt to bring down the pair to $16.
Decentraland (MANA), which was down from the 20 day EMA ($1.24) May 16, but a positive sign that the bulls didn’t allow the price to drop below the psychological level of $1 is a positive sign.
Daily chart MANA/USDT Source: TradingView
Buyers will attempt to push the price higher than the 20-day EMA once more. The MANA/USDT pairing could rally to the 50 day SMA ($1.72). Although bears could again resist at this level, if bulls overcome this obstacle, the pair could begin its northward march towards the 200-day SMA ($2.72).
Contrary to popular belief, bears will attempt to bring the pair below $1 if they see a drop in price. The next leg of the downtrend could begin if the price breaks and closes below this level.
MANA/USDT 4-hour chart. Source: TradingView
The pair is stuck at $0.97 to $1.36. This indicates that the bulls are buying dips below $1 while the bears are selling rallies. The consolidation could continue for some time, as the 20-EMA has flattened and the 50-SMA has also sunk.
The pair could reach $1.36 resistance if buyers push the price higher than the 50-SMA. If buyers can overcome this barrier, the bullish momentum may pick up. If the price falls below $0.97, the bears may gain the upper hand.
You should research all aspects of trading and investment before making any decision.
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.