Last week, both the S&P 500 Index (SPX) and the Nasdaq Composite reached new all-time highs, indicating that investors are feeling optimistic. Bitcoin (BTC) is also making a strong push and is just under $2,000 away from its all-time high of $68,990, which was reached in November 2021.
The current momentum seems to be in favor of the buyers, suggesting that Bitcoin’s price could reach a new all-time high in the coming days. However, there is a crucial question to consider: if the price surpasses $68,990, will it mark the beginning of the next upward trend, or will it sharply decline, trapping bullish investors?
During a FOMO (fear of missing out) phase, significant returns can be made in a short period of time. While the risk is high, traders who can ride this phase are often rewarded. However, it’s important for traders to exercise caution, as vertical rallies are often followed by steep declines. Therefore, it’s crucial for traders to set up stop-loss orders to protect their gains from evaporating quickly.
Now, let’s analyze the charts to determine whether the bulls can drive Bitcoin to a new all-time high and sustain it, or if it’s time to take profits.
S&P 500 Index Analysis:
On March 1, the S&P 500 Index closed at a new all-time high, indicating that the bulls are firmly in control.
The index has been trading within an ascending channel pattern for a while, suggesting that the bears may pose a strong challenge at the resistance line. If the price turns down from this line, the bears will attempt to pull the index towards the support line, potentially starting a short-term corrective phase.
However, if the bulls manage to propel the price above the channel, it will signal a pickup in momentum. This could initiate a vertical rally, potentially taking the index to 5,300 and then to 5,500. Traders should be cautious, though, as the negative divergence on the relative strength index (RSI) suggests that the bulls may be losing steam.
U.S. Dollar Index Analysis:
The U.S. Dollar Index (DXY) briefly surpassed the 20-day exponential moving average (EMA) on February 29 but failed to sustain the momentum and fell back below the EMA on March 1.
Currently, the 20-day EMA is flat, and the RSI is near the midpoint, indicating a possible period of range-bound action in the near future. If the price remains below the 20-day EMA, the index could decline towards the 50-day simple moving average (SMA), at around 103. However, buyers are expected to defend this level vigorously.
On the other hand, if the price turns upwards from the current level and rises above 104.30, it will indicate strong buying at lower levels. This could push the index towards 105, and a break above this resistance could open the doors for a potential rise to 106.
Bitcoin Price Analysis:
Bitcoin has been experiencing a solid uptrend in recent days. Although the bears tried to halt the upward movement around $64,000, a pennant formation emerged instead.
On March 4, the bulls reasserted their dominance by breaking above the pennant, signaling the start of the next leg of the uptrend. This leg could potentially reach the all-time high at $68,990 and continue towards $76,000, which is the pattern target of the breakout from the pennant.
Time is running out for the bears. If they want to make a comeback, they will have to quickly push the price below $60,000. Doing so could trigger several short-term traders’ stop-loss orders, potentially causing the BTC/USDT pair to drop to the 20-day EMA at $56,250.
Ether Price Analysis:
Ether (ETH) experienced profit-taking near $3,600 on February 29, but the bears failed to initiate a pullback, indicating strong buying on every minor dip.
The bulls are once again attempting to overcome the strong resistance at $3,600. If they succeed, the ETH/USDT pair could begin the next leg of the uptrend and surge towards $4,000 and later $4,150.
Although the upward sloping moving averages suggest that the bulls are in control, the RSI has been in the overbought zone for some time, increasing the possibility of a short-term pullback. The immediate support on the downside is at $3,300, followed by the 20-day EMA at $3,129.
BNB Price Analysis:
BNB has been in an uptrend for several days. Although the bears attempted to stall the rally at $427, the bulls bought the dip on February 29, indicating positive sentiment.
With the rising moving averages and the RSI in the overbought zone, the path of least resistance appears to be to the upside. If buyers can push the price above $427, the BNB/USDT pair could reach $460. However, breaking above this resistance level may present a challenge for the bulls.
The critical support to watch on the downside is the 20-day EMA at $383. If this support level is breached, it would indicate that short-term traders may be exiting their positions, potentially triggering a corrective phase towards the 50-day SMA at $338.
XRP Price Analysis:
XRP sharply declined on March 3, but the long tail on the candlestick indicates significant buying at lower levels.
The upward trending 20-day EMA and the RSI in the overbought zone suggest that the bulls are in control. While there is a minor resistance at $0.67, it is likely to be surpassed, potentially leading to a rally towards the strong resistance at $0.74.
However, if the price sharply turns down from $0.67, it would indicate that the bears are fiercely defending the level. This could push the price down to the 20-day EMA and keep the XRP/USDT pair range-bound between $0.46 and $0.67 for some time.
Solana Price Analysis:
Solana closed above the $126 resistance on March 1, but the bulls are struggling to maintain the momentum. This suggests a lack of demand at higher levels.
If the price stays above $126, it would increase the likelihood of a resumption of the uptrend. Breaking above the $138 level could propel the SOL/USDT pair towards $143 and then $158.
On the contrary, if the $126 level is breached, the pair may decline to the 20-day EMA at $116. The bears would need to push the price below the 20-day EMA to suggest that the breakout above $126 was a false move. In that case, the pair may drop to the 50-day SMA at $104.
Cardano Price Analysis:
Cardano started the next leg of the uptrend after breaking above the $0.68 barrier on March 1. Although the bears attempted to pull the price back below the breakout level on March 3, the bulls held their ground, demonstrating strong buying on dips.
The upward movement is likely to reach $0.90, where the bears are expected to put up a strong defense. If the momentum remains strong and buyers break through $0.90, the rally could extend to $1.25. However, crossing this level may prove difficult for the bulls.
The RSI is above 80, indicating that the rally is at risk of stalling. The 20-day EMA at $0.64 remains a critical support level to watch on the downside. A break and close below this level would signal that the bulls are losing their grip, potentially causing the ADA/USDT pair to slide towards the 50-day SMA at $0.56.
Dogecoin Price Analysis:
Dogecoin has been experiencing a strong bull run in recent days. Although the bears attempted to push the price lower on March 3, the long tail on the candlestick shows aggressive buying by the bulls.
On March 4, the bulls resumed the uptrend by breaking above the overhead resistance at $0.16. This opens the possibility for a rise to $0.18 and potentially $0.22. However, the sharp rally has pushed the RSI deep into the overbought territory, suggesting that a consolidation or correction may be imminent.
The first support level on the downside is at $0.16, followed by $0.12. If these support levels are breached, it would indicate that the uptrend may be coming to an end.
Avalanche Price Analysis:
Avalanche completed a bullish inverse head-and-shoulders pattern after breaking above the neckline at $42 on March 1.
The AVAX/USDT pair is currently facing a tough battle between the bulls and bears near the $42 level. If buyers can turn this level into support and push the price above $45, the pair could rally towards the psychological resistance at $50. Breaking above $50 could lead to a further rise towards the pattern target of $57.
Sellers would need to pull the price below the 20-day EMA at $40 to weaken the bulls. This could cause the pair to decline towards the 50-day SMA at $37, suggesting that the breakout on March 1 may have been a false move.
Disclaimer: This article does not provide investment advice or recommendations. Every investment and trading decision involves risk, and readers should conduct their own research before making a decision.