Bitcoin (btc) The eight-week winning streak is likely to end as the price is down almost 4% this week. The recent weakness indicates that traders are booking profits, but does not change the short-term bullish trend. The recoil will also help reduce foam that may have been building up.
After the initial shakeout, strong hands are likely to re-enter the cryptocurrency market as the macroeconomic environment remains bullish for risk assets. The Federal Reserve's decision to pause rate hikes and possibly reduce them in 2024 could increase further boost demand for crypto products.
However, nothing goes up in a straight line. After strong rallies, traders usually book profits and shift their attention to other currencies. As Bitcoin takes a breather, traders are likely to turn their attention to select altcoins.
What are the coins that can attract buyers in the short term? Let's take a look at the charts of the top five cryptocurrencies that are showing promise.
Bitcoin price analysis
Bitcoin is getting caught between the 20-day exponential moving average ($41,370) and the downtrend line. This sets the stage for a strong breakout in the coming days.
If the price falls below the 20-day EMA, the bears will sense an opportunity and try to push the BTC/USDT pair to the strong support of $37,980. The bulls are expected to defend this level fiercely. If the price bounces off $37,980, it is likely to face selling at the 20-day EMA and again at the downtrend line.
Instead, if the price rises and breaks above the downtrend line, it will suggest that the bulls are asserting their dominance. The pair could then retest the overhead resistance at $44,700. If this level is scaled, prospects for a rally to $48,000 improve.
The moving averages on the 4-hour chart have turned lower and the Relative Strength Index (RSI) is trading in negative territory, indicating that the bears have a slight advantage in the near term. The bears will have to break the $40,000 support to accelerate the selling and sink the pair to $37,980.
On the upside, a break above the downtrend line will suggest that the bulls have absorbed the selling. The pair may first rise to $43,500 and then rise to $44,700. This level may witness a tough battle between bulls and bears.
cosmos price analysis
Cosmos (ATOM) has been in an upward trend for several days. Bulls bought the dip to the 20-day EMA ($10.52) on December 16, indicating solid demand at lower levels.
The bulls are trying to push the price above the immediate resistance at $12.50, but the bears are not letting up. However, the ascending moving averages and the RSI in the positive zone suggest that the path of least resistance is to the upside.
If the buyers push the price above $12.50, the ATOM/USDT pair may rise to $13 and then $15. If the bears want to avoid the bullish move, they will have to drag the pair back below the EMA of 20 days. Then, the pair could fall to the 50-day SMA ($9.40).
The 4-hour chart shows that the bears are offering strong resistance at $12, but a positive sign is that the bulls have not allowed the price to fall below the 50 SMA. Ascending moving averages and RSI near the midpoint They give a slight advantage to the bulls.
A break above $12 will complete an inverse head and shoulders pattern. This bullish setup has a target of $13.31. On the contrary, if the price turns lower and falls below the 50 SMA, the path will be cleared for a drop to $9.50.
Filecoin Price Analysis
Filecoin (FIL) fell from $5.67 on November 13, but has reached that level again. This shows that lower levels are being bought.
The FIL/USDT pair is trying to form a cup and handle formation, which will complete with a breakout and close above $5.67. If that happens, the pair will signal the beginning of a new bullish movement. The target pattern of the reversal setup is $8.41.
However, the bears are unlikely to give up easily. They will pose a strong challenge at $6.50 and again at $7.40. This bullish view will be invalidated in the near term if the price turns lower and falls below the 50-day SMA ($4.61).
The bulls pushed the price above the overhead resistance of $5.67 but were unable to hold the higher levels. Taking advantage of the situation, sellers are trying to pull and keep the price below $5.67. If they are successful, the pair may fall to the 20-EMA. This is still an important support that needs to be paid attention to.
If the price bounces off the 20 EMA, it will improve the prospects for a retest of the overhead resistance at $6.20. A break above this resistance will signal the start of the next leg of the uptrend. On the downside, a break below the 20-day EMA could open the doors for a drop to $4.40.
Related: Bitcoin Fees Hit 20-Month High as Miner Revenue Equals BTC Price of $69,000
MultiversX Price Analysis
MultiversesX (EGLD) broke down from the overhead resistance of $70 on December 12 and reached the 20-day EMA ($55) on December 16.
The bounce off the 20-day EMA indicates that sentiment remains bullish and traders are buying the dips. The bulls will try to push the price to $70, which remains the crucial resistance to watch in the near term. If buyers overcome this hurdle, the EGLD/USDT pair could gain momentum and rise to $90 and then $100.
In the meantime, sellers likely have other plans. They will try to sell the rallies and push the price back below the 20-day EMA. If they manage to do so, it will signal the start of a deeper correction to the 50-day SMA ($46).
The pair has found support near $57 twice recently, making this the crucial level to watch in the near term. A break and close below this level could open the doors to a drop to $48.
On the contrary, if the price rises from the current level or the strong support of $57 and rises above $64, it will suggest an advantage for the bulls. That raises the possibility of a rally to $70, which will likely see a tough battle between the bulls and the bears.
Algorand Price Analysis
Buyers find it difficult to push Algorand (SOMETHING) above the overhead resistance at $0.22, but a positive sign is that they have not given up much ground. This shows that the bulls anticipate another leg higher.
Both moving averages are rising and the RSI is in positive territory, indicating that the bulls are still in control. Buyers are expected to buy the dip to the 20-day EMA ($0.18). If the price bounces off the 20-day EMA, the bulls will again try to break the $0.22 barrier.
If they do that, the ALGO/USDT pair could rise to $0.24 and then $0.28. This positive view will be invalidated in the short term if the pair falls and closes below the 20-day EMA. That will signal the start of a deeper correction to the 50-day SMA ($0.14).
The pair has been range-bound between $0.18 and $0.22 for some time. The 20-day EMA has started to turn lower and the RSI has fallen into the negative zone, increasing the probability of a drop to $0.18.
Buyers are expected to protect the $0.18 level vigorously because a break below it will complete a triple top pattern. This bearish setup has a target of $0.14.
If the price bounces strongly from $0.18, it will indicate aggressive buying on dips. Then, the pair could rise to the 20 EMA and subsequently to $0.22. A break and close above $0.22 suggests the start of the next leg of the upward movement.
This article does not contain investment advice or recommendations. Every investment and trading move involves risks, and readers should conduct their own research when making a decision.
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