Bitcoin (BTC) attempted to break out of its range last week, but the bulls were unable to sustain the higher levels. Bitcoin is back in the range, trading near $26,000. The price action of the past few days has formed two consecutive doji candlestick patterns on the weekly chart, indicating uncertainty about the next move.
While it is difficult to predict the direction of the breakout, downside may be limited in the near term in anticipation that the U.S. Securities and Exchange Commission (SEC) may eventually approve one or more pending applications for a spot bitcoin exchange-traded fund. Former committee chairman Jay Clayton sounded confident when he said in a recent interview that “approval is inevitable.”
In the short term, it is difficult to identify specific catalysts that could take Bitcoin out of its range. Most of the major altcoins are under pressure due to the lack of clarity on where Bitcoin will trend next.
Only a handful of altcoins are showing signs of strength in the short-term. Let’s examine the charts of the top 5 cryptocurrencies that could start a rally if they break their respective overhead resistance levels.
Bitcoin Price Analysis
Bitcoin is back in the $24,800-$26,833 range, but a positive sign is that bulls continue to buy on dips from the long tail of the September 1 candlestick.
While the downward sloping moving averages suggest bears have the upper hand, the recovering Relative Strength Index (RSI) suggests that bearish momentum may be fading. The first sign of strength would be a break and close above the $26,833 range. If this happens, the BTC/USDT pair could retest the August 29 intraday high of $28,142.
If the bears want to take control, they will have to push the price down and sustain it below $24,800. This will be an uphill task as the bulls are likely to go to great lengths to defend the level. However, if the bears gain the upper hand, the pair could drop to $20,000. There is a minor support at $24,000, but that may not stop the decline.
The bears attempted to drag the price below the immediate support at $25,300, but the bulls held their ground. Next, buyers will try to build their strength by pushing the price above the 20 exponential moving average. If they do, it will signal the start of a stronger recovery.
The 50-day simple moving average could act as a hurdle, but it is likely to be breached. This could clear the way for a rally to the overhead resistance at $26,833.
Seller may have other plans. They will try to push the price below $25,300 and challenge the important support at $24,800.
Token Price Analysis
Toncoin (TON) is in an uptrend, but the bears are trying to stop the uptrend near the overhead resistance at $2.07.
Both moving averages have risen, suggesting buyers have the upper hand, but overbought levels on the RSI suggest a minor correction or consolidation could be in the offing. If the bulls do not give up too much ground from current levels, the chances of a rally above $2.07 will increase. The TON/USDT pair could surge towards $2.40.
Conversely, a deeper correction could pull the price towards the 20-day EMA ($1.58). A strong bounce off this level would indicate that market sentiment has turned positive and traders are buying the dips. The trend will turn negative if the 20-day EMA support breaks down.
The 4-hour chart shows that bulls have been buying on pullbacks to the 20 SMA. This remains a key level to watch. If the price rebounds strongly off the 20 SMA, the pair could retest the local high at $1.98. A break above this level could challenge the $2.07 resistance.
Conversely, if the 20-day EMA support is broken, it would suggest that traders are scrambling for an exit. This could start a further pullback towards the 50 moving average. A bounce off this level could face a sell-off at the 20-day EMA, but if this hurdle is cleared, it would suggest bulls regained dominance.
Chainlink price analysis
Chainlink (LINK) has been trading in a wide range between $5.50 and $9.50 for the past few months. The bears pulled the price below the June 10 range support, but they were unable to sustain lower levels.
The LINK/USDT pair dropped close to range support on Aug. 17, but judging by the long tail on the candlestick, bulls bought the dip. Buyers are trying to start a recovery but are facing resistance near the 20-day EMA ($6.24). So this becomes an important level to watch.
If the buyers push the price above the 20-day EMA, the pair could start heading towards the 50-day moving average ($6.95). There is a minor resistance at $6.40, but it is likely to be breached.
Conversely, if the price declines sharply from the 20-day EMA, it would indicate that market sentiment remains negative and traders sell into rallies. This could drag the price down to $5.50.
On the 4-hour chart, the moving averages have flattened out and the RSI is near the midpoint. This suggests that selling pressure is easing. Buyers must push the price above $6.40 to start a fresh increase. The pair could then rise to $6.87 and then to $7.07.
Alternatively, if the price turns down from $6.40, it will indicate that the bears are selling on rallies. This could see the pair range between $5.50 and $6.40 for some time.
related: Bitcoin Chart Highlights $24,700, Analyst Says ‘Nothing’
Manufacturer price analysis
Maker (MKR) has found support near $1,000 and is attempting to resume its uptrend. The bulls are facing resistance at the downtrend line, but a positive sign is that they are keeping the price above the 20-day EMA ($1,107).
If the price recovers from current levels, it would indicate that market sentiment has turned positive and traders see dips as buying opportunities. The bulls will then try again to push the price above $1,370.
Conversely, if the price continues lower and breaks below the 20-day EMA, it will indicate that the bears are fiercely defending the downtrend line. Afterwards, the MKR/USDT pair could drop to the strong support at $980 and eventually to $860.
The 4-hour chart shows that the bulls pushed the price above the downtrend line, but they are struggling to hold higher levels. This shows that the bears have not given up yet and they continue to sell into rallies.
The 20 EMA is witnessing an uphill battle between bulls and bears. If the price bounces off this level, the bulls will make another attempt to overcome the $1,186 hurdle followed by $1,227. If this area is breached, the rally could reach $1,280.
Conversely, if the price sustains below the 20 SMA, it could open the doors for a decline to the 50 SMA and then to $1,040.
Tezos Price Analysis
Tezos (XTZ) is witnessing a battle between bulls and bears near the strong support at $0.70. The failure of the bears to sink and sustain the price below this level suggests buying at lower levels.
The downward sloping moving averages suggest bears have the upper hand, but a rise in the relative strength index suggests that bearish momentum is fading. A close above the 20-day EMA ($0.71) would be the first sign of strength. This could pave the way for a rally to the downtrend line.
This level could be a huge hurdle, but if the bulls overcome it, the XTZ/USDT pair could start a fresh increase. The pair may first rise to $0.94 and then to $1.04. This positive view will be invalidated if the price slides down and sustains below $0.66.
The 4-hour chart shows the price consolidating between $0.69 and $0.66. The crossing moving averages and the RSI just below the midpoint suggest that the bears have a slight advantage. Sellers will try to drag the price to the strong support at $0.66. If this level breaks down, the pair could start the next downtrend towards $0.61.
On the other hand, if the price rises and rises above $0.69, it will indicate selling buying at lower levels. The pair could then surge towards the overhead resistance at $0.74. Buyers must push the price above the downtrend line to signal the start of a new uptrend.
This article does not contain investment advice or recommendations. Every investment and transaction involves risk, and readers should do their own research when making a decision.
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