Bitcoin (BTC) has largely been directionless since the start of the year as the bulls have been buying on dips while bears are selling the rallies. This suggests that the price is consolidating in a large range with both the bulls and the bears waiting for the next trigger to establish their supremacy.
The short-term volatility may pick up after the United States Federal Reserve announces its policy decision on March 16 but unless the Fed springs a surprise, the likelihood of a new trending move could be low. Bitcoin could spend some more time in a bottoming formation before breaking out of it.
A positive sign in the range-bound action this year has been evidence of accumulation by both the small investors and select whales. This has coincided with a sustained drop in Bitcoin balances on exchanges. The combined Bitcoin balances on the 21 exchanges it covers have dropped to 2.32 million Bitcoin, the lowest since August 2018, according to CryptoQuant.
Could Bitcoin break above the immediate resistance level and pull the altcoins higher? Let’s analyze the charts of the top-10 cryptocurrencies to find out.
Bitcoin has bounced from the immediate support at $37,000, indicating that bulls are attempting to defend this level. The buyers will now try to push the price above the moving averages. If they succeed, it will suggest strong demand at lower levels.
The bulls will then try to extend the up-move by clearing the overhead hurdle at $42,594. If they manage to do that, it will be the first indication that the bears may be losing their grip. The BTC/USDT pair could then rise to the overhead zone between $45,400 and the resistance line of the ascending channel.
Conversely, if the price turns down from the moving averages, it will suggest that bears are unwilling to let go of their advantage. The sellers will then attempt to solidify their position by pulling the price below the support line of the channel. Such a move could signal the resumption of the downtrend.
The bulls are attempting to defend the support line of the symmetrical triangle. A strong bounce off the current level could push Ether (ETH) to the moving averages where the bears are again likely to mount a strong defense.
If the price turns down from the moving averages, it will suggest that the sentiment remains negative and traders are selling on relief rallies. That will increase the possibility of a break below the triangle. The ETH/USDT pair could then resume its downtrend and decline to $2,159.
Contrary to this assumption, if bulls propel the price above the moving averages, it will suggest that the selling pressure may be reducing. The pair could then rise to the psychological level at $3,000 and later challenge the resistance line of the triangle.
BNB is attempting to rebound off the support zone between $360 to $350. This suggests that buyers continue to accumulate on dips near the support zone.
The buyers will have to push and sustain the price above the moving averages to indicate that the bears may be losing their grip. If the price sustains above the 50-day simple moving average (SMA) ($389), the bulls will attempt to push the BNB/USDT pair to $425.
This positive view will invalidate if the price once again turns down from the moving averages and breaks below $350. Such a move will suggest that the sentiment remains negative and traders continue to sell on rallies. That could pull the price to the critical support at $320.
Ripple (XRP) price soared above the downtrend line on March 11 but the rally met with stiff resistance at $0.85. This suggests that the bears have not yet given up and they continue to sell on rallies.
The price has pulled back to the 20-day exponential moving average (EMA) ($0.75), which is likely to act as a strong support. If the price rebounds off the current level, the buyers will make one more attempt to push and sustain the XRP/USDT pair above $0.85. If they succeed, the pair could rally to $0.91 and then rise to the psychological resistance at $1.
This positive view will invalidate if the price breaks below the moving averages. Such a move will suggest that the break above the downtrend line may have been a bull trap. A break and close below $0.69 could open the doors for a possible drop to $0.62.
Terra’s LUNA token slipped below $94 on March 11 but the bears could not pull the price to the 20-day EMA ($82). This is a positive sign as it shows that traders are buying on every minor dip.
Although the rising 20-day EMA indicates advantage to buyers, the negative divergence on the relative strength index (RSI) suggests that the bullish momentum may be weakening.
The bulls are attempting to push the price back above $94. If that happens, the buyers will make one more attempt to clear the overhead hurdle at $105 and resume the uptrend. If they do that, the LUNA/USDT pair could rally to $115.
Conversely, if the price turns down from the overhead zone, the bears will try to sink the pair below the 20-day EMA.
Solana (SOL) broke and closed below the strong support at $81 on March 11 and followed it up with further selling on March 13. However, the bears have not been able to break the intraday low at $75 made on Feb. 24.
The positive divergence on the RSI indicates that the selling pressure may be reducing. The bulls are attempting to push the price back above the breakdown level at $81 on March 14. If they sustain the price above $81, it will suggest that the recent breakdown may have been a bear trap. The buyers will then strive to push the SOL/USDT pair above the 20-day EMA ($87).
This positive view will invalidate if the price turns down from the current level and breaks below $75. That will suggest the bears have flipped the $81 level into resistance. The pair could then drop to $66.
Cardano (ADA) is attempting a rebound off the strong support at $0.74 but the effort lacks conviction. A minor positive is that the RSI is showing the first signs of positive divergence, indicating that the selling pressure may be reducing.
The bulls will have to push and sustain the ADA/USDT pair above the 20-day EMA ($0.85) to signal that the bears may be losing their grip. That could open the doors for a possible retest of the breakdown level at $1. This level is likely to attract strong selling.
Contrary to this assumption, if the price turns down from the current level or the 20-day EMA, it will indicate that bears are pouncing on every minor rally. That will increase the possibility of a break below $0.74. If that happens, the downtrend could extend to $0.68.
Related: Bitcoin tracks $39K ahead of Europe vote on Proof-of-Work legality
Avalanche (AVAX) broke below the uptrend line on March 13, indicating that the bears have overpowered the bulls. The attempts by the buyers to push the price above the breakdown level on March 14 met with strong selling by the bears.
If bears sink and sustain the price below $64, the AVAX/USDT pair could slide to the strong support at $51. The downsloping 20-day EMA ($74) and the RSI in the negative territory indicate advantage to sellers.
This bearish view will invalidate in the short term if the price turns up from the current level and breaks above the moving averages. The bulls will then try to overcome the barrier at the downtrend line of the descending channel.
This is an important level to keep an eye on because the bulls have faltered at the downtrend line on four previous occasions. If bulls push and sustain the price above the channel, the pair could rally to $100.
Polkadot (DOT) once again turned down from the 50-day SMA ($18) on March 13 but the bulls are not allowing the price to sustain below the 20-day EMA ($17).
The price has been stuck in a tight range between $16 and $19 for the past few days, indicating indecision among the bulls and the bears. Such tight-range trading is usually followed by a sharp trending move.
If buyers push and sustain the price above $19, the DOT/USDT pair could rally to the next overhead resistance at $23. A break and close above this level will signal that the downtrend may be over.
Alternatively, if the price turns down and breaks below $16, the pair could retest the critical support at $14.
Dogecoin (DOGE) made a strong attempt to start a relief rally on March 14 but the efforts of the bulls met with stiff resistance at the 20-day EMA ($0.12).
If the bulls fail to clear the overhead hurdle, the bears will fancy their chances and try to sink the pair below the psychological support at $0.10. If that happens, the selling could further pick up momentum and the DOGE/USDT pair may slide to $0.06.
Contrary to this assumption, if the price rises from the current level or rebounds off $0.10, it will suggest accumulation by the bulls. The buyers will have to push and sustain the price above the 50-day SMA ($0.13) to signal a possible change in trend.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Market data is provided by HitBTC exchange.