The crypto market corrected on news of the CFTC suing Binance and its CEO Changpeng Zhao, but technical charts reveal a silver lining.
The news and events related to the banking crisis in the United States and Europe have led to a rotation of funds into investments considered less risky. According to the Financial Times, the U.S. money market funds in March witnessed an inflow of $286 billion.
Along with money market funds, a portion of the money may also have seeped into the crypto industry. The increased demand could be one of the reasons for Bitcoin’s (BTC) strong performance in March.
The big question in crypto investors’ minds is whether the recovery will continue or if it is time to book profits in Bitcoin.
Daily cryptocurrency market performance. Source: Coin360
Bitcoin hodlers seem to be confident in the long-term story and are not getting lured into selling their holdings after the recent rally. According to Glassnode data, the percent of Bitcoin supply that has remained dormant since March 2021 has hit a new all-time high.
If the banking crisis is contained, it may lead to a short-term correction in Bitcoin and altcoins but any further problems in the legacy banking system may continue to attract investments into Bitcoin. Let’s study the charts to find out the critical support and resistance levels in Bitcoin and altcoins.
S&P 500 index price analysis
The S&P 500 index (SPX) is trading inside a descending broadening wedge pattern. The bulls tried to push the price above the wedge on March 22 but the bears held their ground.
SPX daily chart. Source: TradingView
Buyers pushed the price above the 20-day exponential moving average (3,964) on March 27 but the long wick on the day’s candlestick shows that bears are in no mood to relent. Sellers will try to sink the price below the 200-day simple moving average (3,931). If they succeed, the index could drop to 3,800.
Contrarily, if bulls defend the moving averages, it will suggest demand at lower levels. The bullish momentum could pick up after buyers thrust the price above the resistance line of the wedge. The index could then skyrocket to 4,200.
U.S. dollar index price analysis
Buyers pushed the U.S. dollar index (DXY) above the 20-day exponential moving average (103) on March 15 but could not build upon the breakout. This shows that bears are selling on rallies.
DXY daily chart. Source: TradingView
The index could drop to the strong support at 100.82 where the bulls will try to arrest the decline. If the price rebounds off this level and rises above the 20-day EMA, it will suggest that the index may oscillate between the 200-day SMA (106) and 100.82 for some more time.
A break below the 100.82 level will be a huge negative as that will complete a bearish head and shoulders (H&S) pattern. The index could then plummet to 95. On the upside, a break above the 200-day SMA could push the price to the 61.8% Fibonacci retracement level of 108.43.
Bitcoin price analysis
Bitcoin has failed to rise above $29,000 in the past few days but the bulls continue to hold strong. They have not allowed the price to even dip to the breakout level of $25,250.
BTC/USDT daily chart. Source: TradingView
The upsloping 20-day EMA ($26,062) and the relative strength index (RSI) in the positive territory indicate the path of least resistance is to the upside.
If bulls drive the price above $29,000, the BTC/USDT pair may quickly climb to $32,500. This level may witness aggressive selling by the bears but if buyers overcome this barrier, the pair could soar to $40,000.
This positive view could invalidate in the near term if the price breaks below $25,250. The emboldened bears will then try to sink the pair to the 200-day SMA ($20,219).
Ether price analysis
Ether (ETH) bounced off the 20-day EMA ($1,705) on March 25 but the bulls could not challenge the overhead resistance at $1,857. This shows that bears are selling on relief rallies.
ETH/USDT daily chart. Source: TradingView
The bears will again try to sink the price below the 20-day EMA and the horizontal support at $1,680. If they can pull it off, the ETH/USDT pair may fall to $1,600. This is an important level for the bulls to defend because if this support cracks, the pair may tumble to the 200-day SMA ($1,435).
Alternatively, if the price rebounds off the 20-day EMA, it will suggest that the bulls continue to buy on minor dips. The pair could then rally to the stiff overhead resistance of $1,857. If this hurdle is crossed, the pair may jump to $2,000 and thereafter to $2,200.
BNB price analysis
BNB (BNB) bounced off the 20-day EMA ($317) on March 25 but the bulls could not clear the downtrend line, indicating that bears are selling on every minor rally.
BNB/USDT daily chart. Source: TradingView
The bears have pulled the price below the 20-day EMA. If they manage to sustain the lower levels, the BNB/USDT pair could plummet to the 200-day SMA ($290). This is an important level to watch out for because if it yields, the pair may nosedive to $265.
The first sign of strength will be a break and close above the downtrend line. That will indicate aggressive buying at lower levels. The pair may then attempt a rally to the $338 to $346 resistance zone.
XRP price analysis
The bulls flipped the moving averages into support and tried to resume the recovery in XRP (XRP). However, the higher levels are attracting aggressive selling as seen from the long wick on the March 27 candlestick.
XRP/USDT daily chart. Source: TradingView
The bears will once again try to pull the XRP/USDT pair to the moving averages. If the price rebounds off the 20-day EMA ($0.41), it will suggest that buyers are accumulating at lower levels. The bulls may then make one more attempt to clear the overhead zone. If that happens, the pair may rally to $0.65 and eventually to $0.80.
On the other hand, if the price slips below the moving averages, it will suggest that the bears are back in control. The pair could then plunge to $0.36.
Cardano price analysis
Cardano (ADA) slipped below the 200-day SMA ($0.36) and reached the 20-day EMA ($0.35) on March 25. The bulls tried a recovery on March 26 but the bounce lacked strength.
ADA/USDT daily chart. Source: TradingView
The bears will try to sustain the price below the 20-day EMA. If they manage to do that, it will indicate that the recent rally above the 200-day SMA may have been a bull trap. The ADA/USDT pair may first slide to $0.32 and then to $0.30.
Conversely, if the price turns up and breaks above the 200-day SMA, it will suggest demand at lower levels. The bulls will then make one more attempt to push the price to the neckline of the inverse H&S pattern.
Related: Why is Bitcoin price down today?
Polygon price analysis
Polygon’s (MATIC) shallow bounce off the strong support at $1.05 on March 25 suggests a lack of aggressive buying by the bulls. The bears are trying to strengthen their position by yanking the price below $1.05.
MATIC/USDT daily chart. Source: TradingView
If bears sustain the breakdown, the MATIC/USDT pair may slump to the 200-day SMA ($0.97). This is an important level to keep an eye on because if it gives way, the sentiment will turn negative and the pair could tumble to $0.69.
If bulls want to prevent this decline, they will have to quickly push the price back above the 20-day EMA ($1.13). That will increase the likelihood of a rally to the strong overhead resistance zone between $1.25 and $1.30.
Dogecoin price analysis
Dogecoin (DOGE) has been swinging between the 200-day SMA ($0.08) and the horizontal support of $0.07 for the past few days.
DOGE/USDT daily chart. Source: TradingView
The flattish 20-day EMA ($0.07) and the RSI just below the midpoint do not give a clear advantage either to the bulls or the bears. This suggests that the DOGE/USDT pair may spend some more time inside the range. The longer the time spent inside the range, the stronger will be the eventual breakout from it.
If the price collapses below $0.07, the pair could extend its decline to $0.06 and then to the vital support near $0.05. Instead, if the price breaks above the 200-day SMA, the pair may soar to the $0.10 to $0.11 resistance zone.
Solana price analysis
Solana (SOL) broke below the 20-day EMA ($20.93) on March 24. Buyers tried to push the price back above the 20-day EMA on March 25 and 26 but the bears held their ground. This suggests that the bears are trying to flip the 20-day EMA into resistance.
SOL/USDT daily chart. Source: TradingView
If the price sustains below $20, the SOL/USDT pair could retest the immediate support at $18.70. This level may attract buying but if bulls fail to propel the price above the 20-day EMA, the prospects of a fall to $15.28 increase.
Contrary to this assumption, if the price turns up from the current level and rises above the downtrend line, it will indicate that the downtrend may have ended. The pair could first rise to $27 and later attempt a rally to $39.
The views, thoughts and opinions expressed here are the authors’ alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
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