Bitcoin’s ( Bitcoin) bounce sank to $24,500 on August 17, which indicates that the bears are still resisting the recovery. Material Indicators, an on-chain monitoring resource, said that the ask liquidity in the Fire Charts was comparable to previous local tops.
The recovery in the S&P500 was also causing crypto investors to be cautious. In the short term, it was approaching extreme overbought levels. Jurrien Timmer was the director of global macro for asset manager Fidelity Investments. He stated that 88% of the S&P 500 stocks were trading above their 50 day moving average. This was “stunning.”
Others were cautious, such as Michael Burry who famously shorted 2008’s housing bubble. In anticipation of a sharp fall of the stock market, he almost empty his equity portfolio during the second quarter.
Although the near-term outlook is uncertain, corporate investors, who tend to be in the game for long-term, have increased their investments into the blockchain industry, which includes the crypto space. According to Blockdata’s blog on Aug. 17, the top 40 publicly traded companies have invested $6 billion in blockchain startups from September 2021 through June 2022. This is three times more than the $1.9 billion that corporations invested between January 2021 and September 2021.
What are the key indicators that the recovery may be slowing down? Let’s look at the charts for the top 10 cryptocurrencies to see what they are.
Although the bulls tried to push Bitcoin over the overhead resistance of $24,668 on August 17, the candlestick’s long candlestick candlestick indicates that the bears are aggressively defending the level. The price fell to $23,496 at the 20-day exponential moving mean (EMA). This level is expected to attract bullish buying.
The 20-day EMA is flattened and the relative strength indicator (RSI), has fallen close to the midpoint. This indicates a balance between supply/demand. If the price falls below the 20-day EMA the balance could shift in favor of bears, and the pair could drop to the 50 day SMA ($22,000.
If the price rises above the current level, and breaks above $25,000.00, it will indicate that the bulls are in control. The BTC/USDT exchange rate could rise to $28,000, where bears might again mount a strong defense.
The price of Ether ( ETH) rose from $1853 on Aug. 16, and bulls attempted to push it above $2,000 on August 17. The candlestick’s long wick suggests traders are taking a more cautious approach to rallies.
The bears will attempt to profit from the situation and pull the price towards the strong support zone of $1,700 and the 20-day EMA ($1,772). If bulls want to maintain the uptrend, this is an important area for them to defend.
The resistance at $2,000.030 could be retested if the price bounces off the support zone. Breaking and closing above this level could open the way for a rally towards the downtrend line.
If the $1,700 support fails, the pair could plummet to the 50-day SMA ($1,492). This could cause a delay in the next leg of up-move, and the pair could remain range bound for a few more days.
On Aug. 17, the buyers attempted to push BNB higher, but the candlestick’s long wick suggests that bears may be active at higher levels. This pushed the price up to the 20-day EMA ($307)
The BNB/USDT price could fall to the $50 SMA ($270) if it falls below the 20-day EMA. This level could attract buyers again and, if it rebounds off it for some time, the pair may consolidate between $270-$338.
Another possibility is for the price to rebound from the current level of strength. This will indicate that traders are buying dips and that sentiment is positive. The bulls will attempt to break through the overhead resistance zone of $338-350. The bulls could then rally to $383, and then to $413 if they succeed.
The bulls successfully defended a zone between moving averages and attempted to push Ripple ( XRP) over the overhead resistance at $0.39 Aug. 17. The candlestick’s long wick shows that bears aren’t willing to give up and continue to fight the overhead resistance.
The 50-day SMA ($0.35) could be reached if the price falls below the $20-day EMA ($0.37). This is an important level that bulls should defend as a break or close below could indicate that the XRP/USDT currency pair will continue its range-bound action between $0.30 to $0.39 for a few days.
The bulls could also attempt to overcome $0.39 if the price bounces off the moving averages. The pair could rally to $0.48, then $0.54 if they succeed.
Cardano ( ADA), bounced from the breakout level $0.55 on Aug. 16, but bears continue to present a strong challenge for higher levels, as shown by the long wick of the Aug. 17 candlestick.
The bears have been selling hard and the price has fallen to $20-day EMA ($0.53). If the price breaks or closes below this level, it will indicate that the short-term advantage is in the sellers’ favor. The ADA/USDT currency pair could fall to the 50-day SMA ($0.49).
However, if the price bounces off the 20-day EMA it will indicate strong demand at lower levels. The bulls will attempt to re-establish the up-move and push the pair higher than $0.60. This could lead to a rally to $0.63, and then to $0.70.
Solana ( SOL) tried to rebound from the 20-day EMA (42), but the candlestick’s long wick shows that bears are selling at every minor increase.
The bears will attempt to lower the price below the support level. They will attempt to sabotage the bullish ascending triangle pattern. The SOL/USDT exchange rate could fall to $37.50, and then to $34.50.
If the price bounces off the moving averages it could indicate that bulls are accumulating on dips. The buyers will attempt to push the price higher than the $48 overhead resistance. If they succeed, the bullish setup is complete and the pair could rally to $60.
The bears took Dogecoin ( DOGE) below its breakout level of $0.08, but were unable to sustain lower levels. Bulls bought the dip aggressively and resumed recovery on August 16.
While the bears want to stop the recovery at $0.09, if the bulls don’t allow the price to drop below $0.08, there is a greater chance of a rally up to $0.10. This level is important to watch because a break or close above it could signal an eventual trend change.
The 20-day EMA ($0.07) is starting to rise and the RSI has moved into the positive territory. This indicates that bulls are in control. To discredit this bullish view, bears must sink and maintain the price below the triangle’s trendline.
Related: Fake Manchester United token soars 3,00% after Elon Musk makes jokes about buying a team
Although the bulls were able to defend the 20-day EMA (8.62%) on Aug. 15-16, they could not make a strong rebound. The bulls tried to push Polkadot ( DOT) over the $9 overhead resistance but were met with stiff resistance Aug. 17.
The bears want to keep the price below 20-day EMA. It could trap bulls who might have bought at higher levels if they succeed. This could send the DOT/USDT-pair to the 50 day SMA ($7.72).
If the price rises above $9 and goes up from its current level, it will indicate that bulls are buying aggressively at lower levels. The bulls will attempt to push the price above the overhead resistance at 9.68 to resume recovery. The pair could rally to $10.80, and then to $12.44.
Shiba Inu’s ( SHIB’s ) correction was stopped at $0.000015 Aug. 15, but bulls are now facing stiff resistance at $0.000017 overhead resistance, as seen from the long candlesticks on the Aug. 16-17 candlesticks.
Failure to clear the overhead hurdle could encourage the bears, who will attempt to pull the price back to $0.000014. The bulls must defend this level as a breach or close below it could reduce the positive momentum.
For a few days, the SHIB/USDT pair might remain in a wide range between $0.000010 to $0.000018.
Alternativly, if the price rises from its current level and crosses the $0.000017- $0.000018 overhead resistance zone the pair could reach $0.000022. The rally could reach $0.000026 if bulls overcome this obstacle.
Avalanche ( AVAX ) continues to slide towards the $26.38 breakout level. The bulls will likely buy the dip and try to turn this level into support.
The buyers will attempt to push the AVAX/USDT price above $31 if the price rebounded from $26.38 with strength. The pair could rally to $33 if they succeed and then to $39.05.
Contrary to popular belief, aggressive bulls could be trapped if the price falls below the breakout level. This could lead to a fall to the 50-day SMA ($22.70), and then to support line for the ascending triangle.
These views and opinions are the author’s and do not necessarily reflect those of Cointelegraph. Risk is inherent in every investment or trading move. Before making any investment or trading move, you should do your research.
Market data are provided by HitBTC Exchange.