After closing above $30,000 in the week before, Bitcoin witnessed aggressive profit-booking last week, which resulted in a 9% pullback. Several major altcoins have also witnessed strong moves lower, unnerving retail investors. Glassnode data shows that short-term holders, who have been owning Bitcoin for less than 155 days, have been sending coins to the exchanges at a loss since April 16.
That could be because some believe the crypto recovery is over and Bitcoin could retreat below $25,000 and even retest $20,000. However, long-term investors are unfazed by the recent correction and are already looking at the upcoming halving in 2024.
Bloomberg Intelligence analyst Jamie Douglas Coutts said that Bitcoin’s current structure is looking similar to previous cycle bottoms that happen about 12 to 18 months before the halving. Coutts expects Bitcoin to surge to $50,000 by April 2024. Similarly, Markus Thielen, research head at Matrixport, also projects Bitcoin to rally to around $65,623 by April 2024, Bloomberg reported.
Going further out, Standard Chartered is even more bullish. They believe that the so-called “crypto winter” is over and Bitcoin could be on the path to $100,000 by end-2024.
Considering the growing bullish projections for 2024, traders should not panic and sell their holdings on every minor correction. Typically, in an uptrend, the price retraces a portion of its rise and forms a higher low, which acts as a floor during future pullbacks.
Therefore, if traders are confident that a major low has been made, then every dip can be viewed as a buying opportunity. However, it is generally a good strategy not to buy on the way down because sometimes, the corrections can be severe. Traders may wait for the pullback to end and the price to form a short-term bottom before jumping in to buy.
What are the levels where the latest leg of the correction may find support? Let’s study the charts of Bitcoin and the major altcoins to find out.
BTC/USD Market Analysis
We said in our previous analysis that if the 20-day exponential moving average (EMA) gives way, Bitcoin could plunge to $26,500 and it came close to this level. The BTC/USD pair dropped to $26,965 on April 24.
The 20-day EMA has started to turn down and the relative strength index (RSI) is in the negative territory, indicating that bears have the upper hand.
Buyers have managed to defend the 50-day simple moving average (SMA) for the past few days but the weak rebound shows a lack of demand at higher levels.
The bears will try to capitalize on this situation and yank the price below the 50-day SMA. If they manage to do that, the pair could plummet to the neckline of the inverse head and shoulders (H&S) pattern at $25,000.
This level is likely to attract aggressive buying because a break below it may invalidate the bullish setup and trap the buyers.
On the upside, the 20-day EMA is the resistance that needs to be crossed for the momentum to pick up and the pair to resume its northward journey.
ETH/USD Market Analysis
We said in the previous analysis that bulls were in command but if the 20-day EMA gives way, it will be a sign of weakness and Ether could nose dive to $1,800 and that is what happened.
The bulls are trying to protect the 50-day SMA but the long wick on the April 24 candlestick shows that the bears are not willing to let go of their advantage. Sellers are trying to flip the 20-day EMA into resistance.
That increases the likelihood of a break below the 50-day SMA. If that happens, the ETH/USD pair may drop to the crucial support at $1,700.
Buyers are expected to fiercely protect this level because a break below it may intensify selling and sink the pair to $1,600 and thereafter to $1,400.
This bearish view will be invalidated in the near term if the bulls push and sustain the price above the 20-day EMA. The bulls will further gain strength on a break above the psychological resistance at $2,000.
BNB/USD Market Analysis
Binance Coin turned down from $350 on April 17 and plunged to the 50-day SMA. The bulls bought the dip to this level on April 21 and pushed the price back above the 20-day EMA on April 22.
The bears are trying to stall the up-move near $335 but a positive in favor of the bulls is that they have not allowed the BNB/USD pair to slip below the 20-day EMA. This suggests that the bulls are buying every minor dip.
If bulls propel the price above $335, the pair will attempt to rally to the overhead resistance at $350. This is likely to be the final hurdle before the pair ascends to $400.
On the way down, a break below the 50-day SMA will indicate that the bears are in control. The pair may then dive to $300 and later extend the decline to $265.
XRP/USD Market Analysis
We warned in the previous analysis that the indicators suggested that the bullish momentum was weakening. We projected that if the $0.48 level broke down, XRP could fall to $0.43 and that is how it played out. The XRP/USD pair fell to $0.44 on April 21.
Buyers are trying to defend the 50-day SMA but the bears continue to sell on rallies to the 20-day EMA as seen from the long wick on the April 24 candlestick.
The downsloping 20-day EMA and the RSI in the negative zone indicate advantage to bears. If the $0.44 support crumbles, the pair may fall to $0.40.
If bulls want to prevent the decline, they will have to propel the price back above the 20-day EMA. If they succeed, the pair may rally to $0.54.
ADA/USD Market Analysis
Cardano completed an inverse H&S pattern on April 13 but we cautioned traders that a retest of the neckline is likely. The ADA/USD pair plunged below the neckline on April 20, indicating that the breakout may have been a bull trap.
The buyers are attempting to arrest the decline at the 50-day SMA but the shallow bounce suggests a lack of solid demand at current levels. If the 50-day SMA collapses, the pair may sink to $0.33 and subsequently to $0.30.
This bearish view will be invalidated if the price turns up from the current level and rises above the neckline. Such a move will indicate that the lower levels are attracting buyers. The pair may then rally to $0.46.
Hopefully, you have enjoyed today’s article for further coverage please check out our crypto Blog Page. Thanks for reading! Have a fantastic day! Live from the Platinum Crypto Trading Floor.
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