Bitcoin (BTC) has rallied around 90% since the start of the year and is up nearly 191% from its March lows. The rise has been gradual without much hype, which suggests crypto believers are the ones who bought into 2020.
The October monthly close at $ 13,798.99 is the highest ever, surpassing the December 2017 close at $ 13,789.68. Bitcoin’s strong performance could now attract momentum players and speculators looking to take advantage of the strength.
If that happens, Bitcoin could gain momentum and surprise investors to the upside. This could lead to traders selling their altcoins to invest in Bitcoin. So, the altseason seems to be over in the short term.
Three of the top five cryptocurrencies analyzed today could offer an upside trading opportunity, while the other two could continue to decline further. Let’s take a look at the critical levels that can indicate the start of a trend move.
BTC / USD
Bitcoin rose above the $ 13,973.50 resistance and reached an intraday high of $ 14,101.91 on Oct 31. Although the bulls failed to sustain the price above the resistance, they did not break much to the downside.
This suggests that traders are not closing their positions quickly as they expect another attempt by the bulls to push the price above the resistance.
Both the 10-day exponential moving average ($ 13,309) and the 50-day simple moving average ($ 11,505) are rising and the relative strength index is in the overbought territory. This suggests that the bulls are in command.
If the BTC / USD pair closes above $ 14,000, the next phase of the uptrend that could reach $ 16,500 could begin.
However, if the bulls fail to sustain the price above $ 14,000 again, short-term traders may drop their positions and the bears may take short positions. A break below the 10-day EMA will be the first sign that the momentum has weakened.
The bears are likely to gain the upper hand if the pair falls and sustains below the critical support at $ 12,460.
The pair are currently attempting to stay above the 10-EMA. If this happens and the bulls manage to push the price above the $ 13,973.50 to $ 14,101.92 resistance zone, a new uptrend is likely.
However, the bearish divergence on the RSI suggests that the upward momentum is weakening. If the sellers manage to sink the pair below the 10-EMA, a drop to the 50-SMA and then $ 13,000 will be on the schedule. Strong support in the $ 12,750– $ 13,000 zone could attract buyers.
BNB / USD
Binance Coin (BNB) broke below the $ 28.50 support on October 30, but managed to rebound from the intraday lows and close above $ 28.50. However, the October 31st doji candle pattern suggested indecision between bulls and bears.
The bears are currently attempting to resolve the downside indecision and take over. If the BNB / USD pair breaks out and closes below $ 27.50, the possibility of a drop to $ 24.86 will increase.
The falling 10-day EMA ($ 29.47) and the RSI in the negative zone suggest that the path of least resistance is to the downside.
Contrary to this assumption, if the price reverses direction and rises above $ 28.50, it will suggest a few more days of consolidation.
The 4-hour chart shows that the rally from $ 27.5111 is facing strong resistance at the 10-EMA. A break below $ 28 could challenge the support of $ 27.50, which if broken, the next stop could be $ 26.50.
Both moving averages are down and the RSI is near the oversold zone, suggesting an advantage for the bears.
This view will be invalidated if the pair turns around and rises above $ 29. Such a move will suggest build-up to lower levels and increase the possibility of a rise to $ 30.50.
ADA / USD
Cardano (ADA) broke below the bearish bullish wedge pattern on Oct 26 and plunged to the $ 0.0891 support. The bulls are currently attempting to defend the support and push the price above the moving averages.
However, the down 10-day EMA ($ 0.988) and the RSI below 43 suggest that the bears are in control. Therefore, the rebound is likely to encounter strong resistance at the moving averages.
If the ADA / USD pair breaks out of this resistance, the bears will again try to break out of the support at $ 0.0891. Such a move will open the door for a drop of the next support at $ 0.0755.
This bearish view will be invalidated if the bulls can push and sustain the price above the moving averages. Such a move could lead to a rally to $ 0.11.
The bulls have pushed the price above the 10-EMA on the 4-hour chart. The pair could now rise to the 50 SMA, where the bears could again step in and sell.
Although the 50-SMA is still down, the 10-EMA is attempting to rise and the RSI has moved up to the midpoint, which suggests that the selling pressure has eased in the near term.
However, if the pair falls from the current levels or the 50-SMA, the bears will once again try to lower the price below the support of $ 0.0891. If they succeed, the next leg of the downward movement may begin.
BCH / USD
Bitcoin Cash (BCH) has formed a symmetrical triangle, which usually serves as a continuation pattern. However, as this setup suggests indecision between the bulls and bears, it is best to wait for the price to break out of the triangle before placing a directional bet.
Both moving averages are up and the RSI is above 59, which suggests the bulls have the upper hand. If the bulls can push and sustain the price above the triangle, the BCH / USD pair can move up to $ 280 and then to $ 296.87.
Contrary to this assumption, if the price breaks out of the triangle, the BCH / USD pair can drop to the critical support at $ 242. The 50-day SMA ($ 239) is positioned just below this support, so the bulls may buy a downside in this zone.
The bulls had pushed the price above the resistance line of the symmetrical triangle but failed to sustain the higher levels and the bears dragged the price back into the triangle.
However, if the pair bounces off the 50-SMA or 10-EMA, the bulls will make one more attempt to push the price above the triangle. If successful, the momentum can build up and a rally to $ 280 is likely.
This positive view will be negated if the price breaks below the moving averages and falls below the symmetrical triangle.
LINK / USD
Chainlink (LINK) has been trading inside an ascending channel for the past few days. Although the pace of growth has been slow, the altcoin has recorded successive highs and lows.
The LINK / USD pair is currently correcting from the overhead resistance of $ 13. Both moving averages have flattened out and the RSI is near the midpoint, suggesting a balance between supply and demand.
The bulls are likely to buy the decline to the support line of the channel. If the price bounces off this support strongly, the bulls may attempt to push the pair above $ 13 again.
This positive view will be invalidated if the bears push the price down below the channel. Such a move could drag the price down to $ 8.3817 and further down to $ 7.2869.
The bulls are currently attempting to defend the bullish trend line. If they manage to push the price above the downtrend line, the pair could start its journey towards $ 13.
However, the 10-EMA has flattened out and the RSI has been trading in negative territory, which suggests that the bears are attempting a short-term comeback.
If the bears manage to lower the price below the uptrend line, the pair could drop to the support line of the channel. The bulls will try to defend this support and if they succeed, the pair could move up to the downtrend line.
The views and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move carries risk, you should conduct your research when making a decision.