Bitcoin (BTC) and several altcoins have bounced off their immediate support levels after buyers attempted to arrest the current decline. Bloomberg senior commodity strategist Mike McGlone highlighted in a recent tweet that Bitcoin was trading roughly 20% below its 50-week moving average and such discounted levels have “often resulted in good price support.”
The bearish price action of the past few days does not seem to have deterred the institutional traders from accumulating at lower levels. According to CoinShares’ Feb. 22 “Digital Asset Fund Flows Weekly” report, institutional investors pumped about $89 million into Bitcoin funds between Feb. 14 and Feb. 18, taking the total inflows in the current month to $178.3 million.
Crypto traders do not seem to be too scared by the current 50% correction. In a survey conducted by Deutsche Bank, only about 35% of the respondents said they would reduce their trading in an extremely bearish crypto market condition. A majority, more than 70%, said they planned to increase their crypto activity over the next six months.
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Could Bitcoin and altcoins sustain the relief rally or will bears pounce and stall the recovery? Let’s analyze the charts of the top-10 cryptocurrencies to find out.
Bitcoin bounced from the first support at $36,250 and the bulls will now attempt to push the price above the overhead resistance zone between $39,600 and the 50-day simple moving average (SMA) ($40,615).
If they manage to do that, the BTC/USDT pair could rise to $45,821 where the bears are likely to mount a stiff resistance.
The long wick on Feb. 23’s candlestick suggests that bears are attempting to flip $39,600 into resistance. The downsloping moving averages and the relative strength index (RSI) in the negative territory suggest that bears have the upper hand.
A break and close below $36,250 will signal the resumption of the down move. The pair could then decline to $34,000 and later retest the Jan. 24 low at $32,917.
Ether (ETH) bounced off the psychological support at $2,500 on Feb. 22. The bulls have pushed the price above the breakdown level of $2,652, indicating strong buying at lower levels.
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The buyers will now try to propel the price above the moving averages. If they succeed, the ETH/USDT pair could rally to the resistance line of the symmetrical triangle pattern. The bulls will have to push the price above the triangle to signal the start of a new uptrend.
Alternatively, if the price turns down from the moving averages, the bears will try to pull the pair below the support line of the triangle. If they manage to do that, it will suggest that the symmetrical triangle has acted as a continuation pattern. The pair could then drop to $2,159 and later to $2,000. - Cointelegraph.
