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Bitcoin (bitcoin), most major altcoins continued to experience a bloodbath on Jan. 21, with the latest downturn resulting in a $200 billion loss in market cap.
A new report from Huobi Research in partnership with the Singapore Blockchain Association predicts Bitcoin will enter a bear market in 2022. Liquidity tightening measures by the Federal Reserve and other central banks around the world, as well as regulatory actions by authorities, could be disruptive and rein in cryptocurrency prices.
The bear market calls haven’t shaken MicroStrategy CEO Michael Saylor, who is determined to keep holding the company’s bitcoin. Saylor said in a recent interview with Bloomberg that the company’s strategy is Get and hold bitcoin instead of selling.
Can Bitcoin and most major altcoins bounce off strong support levels? Let’s study the chart of the top 10 cryptocurrencies to find out.
Bitcoin/USDT
Bitcoin attempted a rebound on Jan. 20 when the bulls pushed the price above the 20-day exponential moving average (EMA) ($43,041). However, the bears had other plans as they sold the gains and pushed prices lower, as seen by the long wicks on the day’s candlesticks.
The sell-off continued on January 21, and the BTC/USDT pair has fallen below the strong support at $39,600. There is minor support at $37,332.70. The bulls are likely to defend this support area with all their might.
Oversold levels on the Relative Strength Index (RSI) also suggest a possible consolidation or rally. If the subsequent relief rally rises above the 50-day simple moving average (SMA), it would suggest that the downtrend may be over.
Conversely, if the price plummets below the support area, bearish momentum could build and the pair could slide towards $30,000.
ETH/USDT
etheric (Ethereum) The long wick on the Jan. 20 candlestick indicates that the trend remains negative, with traders selling on a bounce to strong resistance.
The sell-off continued on January 21, with the bears pulling the price below immediate support at $2,928.83. This opens the door for a possible drop to $2,652, where buyers are expected to mount strong defenses.
If the price bounces off $2,652, the bulls will make another attempt to push the ETH/USDT pair above the 20-day EMA and the resistance line of the channel. If this happens, the pair could signal a change in trend.
Conversely, if the bears sink and sustain the price below $2,652, the sell-off could accelerate and the pair could drop to $2,000.
BNB/USDT
Binance Coin (BNB) retreated from the 20-day EMA ($474) on Jan. 20, suggesting that bears are aggressively defending this resistance. Sellers will now attempt to drag prices below the Jan. 10 intraday low of $405.60.
The downward sloping moving averages and the RSI in negative territory suggest that the bears have the upper hand. If the price sustains below $405.60 and the descending channel, selling could intensify and the pair could drop to $325.
Conversely, if the price bounces off $405.60 or the channel support line, the bulls will make another attempt to push the BNB/USDT pair above the 20-day EMA and the channel resistance line. If they do, it’s a sign that the trend may have changed.
ADA/USDT
Cardano (have) broke below and closed below the moving average on January 20. The long wick on the candlestick on the day suggests that the bears continue to sell in the rally.
If the bears sustain the price below the moving averages, the ADA/USDT pair could drop to the key support at $1. This is an important support to watch out for, as it hasn’t been breached for about ten months on a closed basis.
If the price rises from current levels and breaks above the moving averages, it will indicate that traders are accumulating on dips. Buyers will have to push the pair higher and hold above the descending channel to signal a possible change in trend.
Sol/USDT
Solana (Sol) formed an out-of-day candlestick pattern on January 20. Traders sold aggressively at higher levels and dragged the price below immediate support at $130.
The SOL/USDT pair has fallen to strong support at $116. If this level also fails to provide support, the decline could extend to the support line of the descending channel. The downward sloping moving averages and the RSI in the oversold zone suggest that the path of least resistance is to the downside.
Alternatively, if the price rises from $116, the bulls will make another attempt to break the 20-day EMA ($146) mark. If they manage to do so, the pair may rise to the resistance line. A breakout and close above the channel could signal a change in trend.
Ripple/USDT
ripple (Ripple) broke and closed below the $0.75 support on Jan. 19. The bulls attempted to reclaim this level on January 20, but the long wick on the candlestick indicated that the bears continued to sell in the rally.
XRP/USDT has broken below the support at $0.69. If the bears sustain lower levels, the pair could extend losses to $0.60. The downward sloping moving averages and the RSI near the oversold zone suggest that sellers are in control.
This negative view will be invalidated if the price rises from current levels and breaks above the moving averages. Such a move could indicate accumulation at lower levels. Then, the pair can start to rise towards $1.
Moon/USDT
Terra’s Luna The token has once again pulled back from the downtrend line on January 20, indicating that the bears continue to vigorously defend the level.
Despite being flat for 20 days ($79), the RSI has dipped below 46, indicating a slight advantage to the bears. If the price sustains below $73.95, the LUNA/USDT pair could start falling towards the key support at $62.46.
Contrary to this assumption, if the price bounces off the current levels, the bulls will make another attempt to push the pair above the downtrend line. If successful, the correction may end. The pair may rebound to $93.81.
related: The 3 Craziest Theories Explaining the $500B Crypto Market Crash
Points/USDT
polka dot(point) has broken below key support at $22.66, an important level to watch as it has not been breached at the close since mid-August last year.
If the price bounces off the current levels, the bulls will make another attempt to clear the hurdle above the moving averages. A breakout and close above the 50-day SMA ($27.08) would be the first sign that selling pressure may be easing. The bulls will have to push and sustain the price above $32.78 to signal a possible trend change.
Conversely, if the DOT/USDT pair sustains below $22.66, it would indicate an oversupply and traders are eager to exit. The pair could then drop to the next support at $16.81.
AVAX / USDT
avalanche(AVAX) fell from near the 20-day EMA ($90) on Jan. 20 and broke below strong support at $75.50 on Jan. 21.
The downward sloping moving averages and the RSI in the negative zone suggest that the bears are in control. A close below $75.50 would complete the descending triangle pattern, indicating that a top may be in place. The AVAX/USDT pair may start falling towards $50.
However, the bulls are unlikely to capitulate without a serious fight. If the price rebounds from the current levels, the pair could recover to the 20-day EMA and then to the downtrend line. The bulls will have to clear this hurdle to signal the possible end of the correction phase.
Dogecoin/USDT
Bulls try to push Dogecoin (Governor) back above the moving average on Jan. 20, but failed. This shows that market sentiment remains negative and the bears are selling near the resistance.
The DOGE/USDT pair may now gradually sink towards the strong support at $0.13 and buyers may step in to stop the decline.
If the price bounces off this level and rises above the moving averages, it would suggest that range-bound action could continue for a few more days.
Key levels on the upside are $0.19 and $0.13 on the downside. After the price breaks either level, the next trend may begin. Until then, erratic random movements in this range are likely to continue.
The views and opinions expressed here are those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading action involves risk. You should do your own research when making a decision.
Market data provided by bitcoin exchange.
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