Cryptocurrency markets are showing no sign of volatility during the year-end holiday season. This suggests that both the bulls and bears are playing it safe and not making big bets due to uncertainty about the next directional move. This indecisive phase is not expected to last long as periods of low volatility are usually followed by increases in volatility.
Willy Woo, creator of on-chain analytics resource Woobull, suggests that the duration of the current bear market could be “longer than 2018 but shorter than 2015.”
Daily crypto market data view. Source: Coin360
The crypto winter has resulted in a loss of more than $116 billion in personal equity for 17 investors and founders in the cryptocurrency space, according to Forbes estimates. The carnage was so severe that the names of 10 investors were removed from the crypto billionaires list.
Could the bear market deepen further or is it showing signs of a recovery rally? Let’s look at Bitcoin (BTC) charts and select altcoins to find out.
BTC/USDT
Bitcoin has been trading in a tight range near the 20-day exponential moving average ($16,929) for the past few days. This suggests that the bears are defending the level, but the bulls are not yet giving up.
BTC/USDT daily chart. Source: TradingView
This period of calm is unlikely to last long and the BTC/USDT pair could see a range extension soon. In general, it is difficult to predict the direction of the breakout, so it is better to wait for a decisive move in the pair before initiating directional bets.
If the price breaks above the moving averages, the probability of a rally to the overhead resistance at $18,388 increases. This level could act as a major roadblock again, but if the bulls break their way, momentum could pick up and the pair could surge to $20,000.
On the downside, a break below $16,256 could signal that the bears are in control. The sellers will then attempt to sink the pair to the key support at $15,476.
BTC/USDT 4 hour chart. Source: TradingView
Both the moving averages on the 4-hour chart are flat and the Relative Strength Index (RSI) is just below the middle. This suggests short-term area-bound action. The limits of the range could be $17,061 up and $16,256 down.
A break above $17,061 will indicate that the bulls have the upper hand and that could start a short-term upside move. On the other hand, a break below $16,256 suggests that the bears have strengthened their hold.
ETH/USDT
Ether (ETH) has held steady at the 20-day EMA ($1,228) for the past few days. This suggests that traders are anticipating a break above this overhead resistance.
ETH/USDT daily chart. Source: TradingView
The 20-day EMA is flattening out and the RSI is slightly below the middle, indicating an equilibrium between buyers and sellers. If bulls propel the price above the moving averages, the ETH/USDT pair could attract further buying. The pair could then rally to $1,352 and later to the downtrend line. This level could again act as a formidable resistance.
On the contrary, when the price fails to break above the moving averages, several short-term traders can sell aggressively. That could pull the price to the strong support at $1,150. When this level gives way, a head and shoulders pattern can complete. That could pave the way for a potential drop to $1,075 and then $948.
ETH/USDT 4 hour chart. Source: TradingView
The 4-hour chart shows that the rally is facing resistance in the zone between the $1,227 38.2% Fibonacci retracement level and the $1,251 50% retracement level. If the price turns down and falls below $1,180, the pair could retest the key support at $1,150.
Conversely, if the price turns up and breaks above $1,251, the rally could reach the 61.8% retracement level of $1,275. If the bulls manage to clear this obstacle, the pair could complete a 100% retracement and rally to $1,352.
TON/USDT
Toncoin (TON) has been consolidating in an uptrend for the past few days. Although the bears stopped the upside at $2.90, a small positive is that the bulls have not given up much ground. This suggests buying from dips.
TON/USDT daily chart. Source: TradingView
The rising 20-day EMA ($2.25) and the RSI in the positive territory are suggesting that the bulls have the upper hand. If buyers push the price above $2.50, the TON/USDT pair could rally to $2.65 and then retest $2.90.
The bears likely have other plans as they try to sink the price below the 20-day EMA and strengthen their position. There is minor support at $2.15 but if that fails the pair could drop to the 50-day SMA ($1.91).
TON/USDT 4 hour chart. Source: TradingView
The pair has formed a symmetrical triangle on the 4-hour chart. This indicates indecisiveness between the bulls and the bears. Also, the flat moving averages and the RSI near the middle do not give anyone a clear advantage.
The first sign of strength will be a break and close above the triangle resistance line. That could trigger a rally to $2.90. If this level scales, the upward move could reach the pattern target of $3.24.
If the price turns down from the 50-SMA or the triangle’s resistance line, it will suggest that the pair could extend its stay in the triangle. A break below the support line could indicate that the bears are back in control.
Related: The 5 most important regulatory developments for crypto in 2022
XMR/USDT
Monero (XMR) has not scaled above the falling wedge pattern resistance line for the past few days, but a positive sign is that the bulls are attempting to sustain the price above the 50-day SMA ($140).
XMR/USDT daily chart. Source: TradingView
The moving averages are flattened out and the RSI is near the midpoint. This indicates a balance between supply and demand. If the price breaks above the 20-day EMA ($144), buyers will attempt to gain the upper hand by pushing the XMR/USDT pair above the wedge. In that case, the pair could rally to $174. A break above this level could signal a possible trend reversal.
On the other hand, if the price falls below $138, the advantage could tip in favor of the bears. The pair could then drop to $125.
XMR/USDT 4 hour chart. Source: TradingView
The pair has bounced off the strong support at $138.50 and the bulls are attempting to push the price above the moving averages. If successful, the pair could rally to the downtrend line where the bears could once again mount strong defenses.
If the price turns down from the downtrend line, the bears will attempt to drag the pair to $138.50. This is an important level to watch for in the short-term as a break below it could complete a descending triangle pattern. The pair could then drop to $132 and thereafter the $124 pattern target.
On the upside, a break of the downtrend line could invalidate the bearish setup and open the way for a potential rally to $153.
OKB/USDT
Centralized cryptocurrency exchanges have been in the eye of the storm since FTX collapsed, but OKB (OKB) is about to complete a bullish reversal pattern. That is the reason for his selection in the list.
OKB/USDT daily chart. Source: TradingView
The OKB/USDT pair has formed a major inverse head and shoulders pattern that will complete on a break and close above $23.22. Both the moving averages are sloping up and the RSI is in the positive territory, suggesting that the path of least resistance is up.
If the price scales above the psychological $25 level, the pair could start a fresh move higher to $28 and then $31. The reversal formation pattern target is $36. This bullish view could be invalidated if the price breaks away from current levels and falls below the moving averages. The pair could then drop to $17.
OKB/USDT 4 hour chart. Source: TradingView
The pair has formed an ascending triangle pattern on the 4 hour chart. This bullish setup will complete on a break and close above $24.15. In that case, the pair could start a fresh upward move towards the $31 pattern target.
Alternatively, if the price turns down and falls below the triangle, the bullish setup will be invalidated. This could trigger stops from aggressive buyers who may have been long in anticipation of a breakout. The pair could then drop to $20.
This article does not contain any investment advice or recommendation. Every investment and trading move involves risk and readers should do their own research when making a decision.
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