Bitcoin, DOGE, and other altcoins seem to have weathered the news of Genesis bankruptcy by leaping from immediate support levels and rallying higher.
News of the bankruptcy did not affect DOGE and others
United States stock markets are on track to finish the week in the red, but this has not resulted in a bigger loss for Bitcoin. The news that crypto lender Genesis filed for bankruptcy in Chapter 11 also had no significant impact on the price of Bitcoin. This indicates that selling pressure may ease.
However, trading firm QCP Capital warned in the latest edition of its regular markets newsletter that the current recovery in Bitcoin is just a bear market relief rally. They predict that this recovery will be followed by another wave of selling that could push the price of Bitcoin and Ether below 2022 lows. QCP used Elliott Wave analysis to arrive at this conclusion.
Bitcoin has been trading in tight range for several days
Bitcoin’s price has been trading in a tight range between $20,400 and $21,650 for the past few days. Generally, a tight consolidation near a stiff resistance is a positive sign as it indicates that traders are not in a rush to take profits.
The upward sloping moving averages and the relative strength index (RSI) in the overbought zone suggest the path of least resistance is up. Buyers will have to push and sustain the price above $21,650 to signal a resumption of the upward move. The BTC/USDT pair could then start its journey towards $25,211.
Conversely, if the bears do not allow the price to rise above $21,650, a few traders who may have bought lower may turn to take profits. Selling could expand on a break below $20,400.
The next support on the downside is the 20-day exponential moving average ($19,268). If the price bounces back from this support, the bulls will attempt to break the overhead $21,650 barrier again, but if the 20-day EMA is broken, the correction could extend to $18,388.
Ethereum has minor pullbacks
Sellers tried to start a deeper correction in Ether but the bulls bought the drop near $1,500 on Jan. 18. This shows that the bulls are buying on minor pullbacks.
The bulls will try to push the price above the overhead resistance zone between $1,610 and $1,680. If they are successful, the ETH/USDT pair could rally to $1,800. This level can again act as a hurdle but if the bulls break it, the pair could reach $2,000.
If the bears want to weaken the momentum, they will have to defend the top zone and push the price below $1,500. The pair could then slide to the 20-day EMA ($1,428) which could attract buyers.
Bulls fight for BNB
BNB bounced off the 20-day EMA ($281) on Jan. 19, but bulls are struggling to maintain momentum as higher highs attract sellers.
The region between the 20-day EMA and the 50-day SMA ($268) is an important area to consider because if the price rises from here, the bulls will again try to push BNB/USDT above $318. If they do, the pair will complete an upside reversal head and shoulders pattern.
On the other hand, if the price continues to decline and dips below the moving averages, it could open the way for a possible drop to $240 and then $220.
XRP is on the rise
XRP found support on the moving averages on January 18 and rallied on January 19. This indicates strong buying at the 20-day EMA ($0.37).
Buyers will try to hold the pace and push the price towards the overhead resistance of $0.42. This is a key level for the bears to defend because if taken, the XRP/USDT pair could rally to $0.51 as there is no big hurdle in between.
The bears are likely to have other plans as they will try to push the price back below the moving averages. If they manage to do so, the pair could drop to the support line where buying could emerge.
Cardano exited support line
Cardano broke out of the support line of the flag pattern on January 19, which is a positive sign. Buyers will try to push the price above the flag to signal the start of the next leg of the up move.
On a break above the flag, the bears can put up a strong defense at $0.37 but if the bulls break this hurdle, the ADA/USDT pair can rally to $0.44. This level can again be a dead end for the bulls.
This positive view could be invalidated in the near term should the price drop and fall below the flag. This could attract more sell-offs from short-term traders and the pair could drop to the 50-day SMA ($0.29).
DOGE level maintained aggressively
Buyers attempted to push above $0.09 for DOGE on Jan. 18, but the bears held the level aggressively, as seen from the long wick on the day’s candlestick.
The bulls held the 20-day EMA ($0.08) support to the downside, but the weak bounce on Jan 19 and Jan 20 suggests hesitation to buy aggressively. This may encourage bears to try to push the DOGE/USDT pair below the 20-day EMA.
If they do, the pair could decline to the strong support near $0.07. The flattening 20-day EMA and the RSI just above the midpoint indicate possible range-bound action in the near term.
If the bulls want to maintain their advantage, they will need to break the hurdle for DOGE at $0.09. The pair could then start its northward march at $0.11.
Polygon trades in wide ranges
Polygon is trading in a wide range between $0.69 and $1.05. Generally, in a well-established range, traders buy near support and sell near resistance.
That’s what happened with the MATIC/USDT pair, which fell from the overhead resistance at $1.05. The first line of support is at the 20-day EMA ($0.90). Buyers held this level on Jan 19 but will need to push the price above $1.05 to start a fresh upward move.
Alternatively, if the price dips below the 20-day EMA, this indicates that the pair may extend its stay in the range for a few more days. The short-term advantage could turn in favor of the bears on a break below the 50-day SMA ($0.86).
Opportunity to buy for Litecoin
Litecoin bounced back from the 20-day EMA ($81) on Jan. 19, suggesting that the bulls see the dips as a buying opportunity.
The bulls will try to push the price up to $91 as they may face strong resistance from the bears. If the bulls rise above $91, the LTC/USDT pair could accelerate and reach the psychologically important $100 and then $107 level.
Another possibility is that the bounce fails and does not rise above $91. This could increase the likelihood of a break below the 20-day EMA. The pair could then decline to the $75 breakout level.
Bears sell on Polkadot rally
Polkadot continues to witness a seesaw war near the downtrend line. This suggests that lower levels are attracting buyers but bears are selling on rallies.
The rising 20-day EMA ($5.34) and the RSI in the positive zone suggest that the uncertainty could be resolved in favor of the bulls. Buyers will have to raise the price above $6.53 to get a charge. If they manage to do so, the DOT/USDT pair could rally to $7.42 and then to $8.05.
Contrary to this assumption, if the price drops and dips below the 20-day EMA, this will indicate that the bears have overpowered the bulls. This could push the price towards the 50-day SMA ($5).
Avalanche bounces back from resistance line
Avalanche bounced back from the resistance line on Jan. 14, but the bears failed to push the price to the 20-day EMA ($14.72). This suggests that sellers may lose control.
Buyers will make another attempt to push the price above the resistance line. If they are successful, the AVAX/USDT pair could gain momentum and rally to $22 and then to $24. The rising 20-day EMA and the RSI near the overbought zone are giving the buyers an advantage.
This positive view may be rejected in the short term if the price drops and dips below the 20-day EMA. This could attract more sells and extend the decline to the 50-day SMA ($13.09).
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