Bitcoin (BTC) experienced significant selling pressure last week, but there is a positive sign as solid buying near the $61,000 level indicates that sentiment remains positive. Traders are viewing the dips as an opportunity to buy.
However, the selling pressure may not be over yet. According to Markus Thielen, the head of research at 10x Research, Bitcoin miners may sell $5 billion worth of Bitcoin over the next four to six months following the Bitcoin halving. This could potentially keep Bitcoin in a sideways market for the next few months.
A sideways market can trap both bulls and bears with false breakouts in both directions. Traders should exercise caution and wait for a sustained breakout before making large bets.
To determine if the correction is over, it is important to look at the resistance levels that Bitcoin must cross. Let’s analyze the charts to find out.
The S&P 500 Index has dropped to the 50-day simple moving average, indicating that bears are trying to take control. If the 50-day SMA is breached, the index could enter a corrective phase, with the first support at 4,900. A bounce off this level could face resistance at the 20-day exponential moving average. A drop below 4,900 would increase the chances of a further decline.
The U.S. Dollar Index has turned up from the 50-day SMA and has broken above the overhead resistance at 105, completing an ascending triangle pattern. If the price turns down from 106 but rebounds off 105, it will signal that bulls have turned the level into support, potentially leading to a rally to 107.
Bitcoin’s bounce off the $60,775 support has reached the moving averages, where bears are expected to defend. If the price turns down from the moving averages, bears will attempt to sink the BTC/USDT pair below $60,775, signaling a deeper correction. On the other hand, a break above the moving averages would suggest that the pair may remain within the $60,775 to $73,777 range for a few more days.
Ether broke below the $3,056 support but quickly recovered. The important level to watch is the 20-day EMA, as a turn down from this level could lead to a drop to $3,056 and subsequently to $2,852. On the other hand, if the price remains above $3,056, the range-bound action is likely to continue.
BNB has been consolidating within a large range between $495 and $635, indicating indecision about the next move. If the price breaks above the 20-day EMA, it could climb to $635, while a turn down from the 20-day EMA could lead to a drop to the support at $495.
Solana turned down from the 20-day EMA and dropped below the 50-day SMA. The bulls are fiercely defending the $126 support level, but a sharp turn down from the moving averages could lead to a drop below $126. On the other hand, a rise above the moving averages could result in a rally to $205.
XRP has been trading within a large range between $0.41 and $0.74. The bulls are trying to start a relief rally, but it could face resistance near the 20-day EMA. On the downside, a drop below $0.41 would give the bears an advantage.
Toncoin continues to trade within an ascending channel pattern, with resistance near the upper line of the channel. A turn down from this level could lead to a drop to the support line, while a break above the channel could indicate a pick-up in momentum.
Dogecoin sliced through the 50-day SMA support, indicating aggressive selling. The bulls are attempting a recovery, but they may face resistance at the moving averages. A turn down from the moving averages would suggest that bears view rallies as selling opportunities.
Cardano plunged below the $0.57 support, completing a bearish head-and-shoulders pattern. However, the price climbed back above $0.46, suggesting buying at lower levels. A recovery could face strong selling at the 20-day EMA, while a break below $0.40 could sink the pair further.
This article provides information and analysis but does not offer investment advice or recommendations. Readers should conduct their own research before making any investment decisions.