BTC and altcoins flashed green at the weekly open, but overhead resistance levels will continue to pose a challenge in the short-term.
After nine successive weeks of red weekly candles, Bitcoin (BTC) printed a green weekly candle on June 5. Leading into this week, buyers kept up their momentum with a strong weekly open that boosted BTC price to $31,800.
Going forward, traders might keep a close eye on the Consumer Price Index (CPI) data for May, which is due on June 10. Depending on the figures, this could keep the volatility elevated as investors digest the report and speculate on the next possible move of the United States Federal Reserve.
Analysts are divided about the next directional move for Bitcoin. While some believe a bottom has been made, others anticipate another leg down. For analyst Bob Loukas, the price action in the summer could remain uninteresting and he expects the new cycle to begin late in the year.
Could bulls sustain higher levels or will bears sell aggressively and pull the price down? Let’s study the charts of the top-10 cryptocurrencies to find out.
After two small range days on June 4 and 5, the range expanded on June 6 and Bitcoin soared above the 20-day exponential moving average (E($30,510). The bulls are attempting to push the price to the overhead resistance at $32,659.
The price action of the past few days has formed an ascending triangle pattern, which will complete on a break and close above $32,659. If that happens, the BTC/USDT pair could start a new up-move. The pattern target of the breakout from the triangle is $38,618.
The 20-day EMA has flattened out and the relative strength index (RSI) is near the midpoint, suggesting that the selling pressure is reducing.
This positive view could invalidate if the price turns down sharply and plunges below the trendline of the triangle. The pair could then drop to the strong support at $28,630 where the bulls may try to arrest the decline. A break and close below this support could tilt the advantage in favor of the bears.
Ether (ETH) bounced off $1,737 on June 3, indicating that bulls are attempting to defend the crucial support of $1,700. The buyers are attempting to push the price above the overhead resistance at the 20-day EMA ($1,930) on June 6.
If they succeed, the ETH/USDT pair could pick up momentum and rally to $2,016. Above this level, the pair could reach the stiff overhead resistance at $2,159. The bears are likely to defend this level aggressively. If the price turns down from this resistance, the pair could consolidate between $2,159 and $1,700 for a few more days.
The long wick on the June 6 candlestick suggests that bears continue to defend the 20-day EMA. This indicates that the sentiment remains negative and traders are selling on rallies. The bears will now try to pull the pair below $1,700 and resume the downtrend.
BNB has formed a symmetrical triangle pattern, indicating indecision among the bulls and the bears. The bulls are attempting to push the price above the resistance line but the bears are not willing to cede ground.
If the price turns down from the overhead resistance, the bears will again try to pull the BNB/USDT pair below the support line. If they manage to do that, the pair could decline to $265 where buying may emerge.
Alternatively, if bulls push and sustain the price above the resistance line, it will suggest that the sellers are losing their grip. The pair could then rally to the breakdown level of $350. This is an important level to keep an eye on because a break and close above it could signal that the downtrend may be over.
Ripple (XRP) has been trading inside a bearish descending triangle pattern. The bulls are attempting to push the price above the downtrend line but the bears are posing a strong challenge as seen from the long wick on the day’s candlestick.
If bulls propel the price above the downtrend line, it will negate the bearish pattern. That could cause a short squeeze, pushing the XRP/USDT pair to $0.46 and later to the psychological level at $0.50.
Conversely, if the price turns down from the downtrend line, the pair could drop to the $0.38 support. If bears pull the price below $0.38, the descending triangle pattern will complete. The pair could then decline to the important support at $0.33. A break and close below this support could resume the downtrend.
Cardano (ADA) had been sustaining above the 20-day EMA ($0.56) for the past few days suggesting accumulation by the bulls. Buying picked up on June 6 and the bulls are trying to push the price above the 50-day SMA ($0.66).
If they succeed, the ADA/USDT pair could rally to the breakdown level of $0.74. This level may again act as a major hurdle but if the bulls overcome it, the recovery could pick up momentum. The pair could then rally to $0.90.
The 20-day EMA has flattened out and the RSI is just above the midpoint, suggesting a slight edge to buyers.
This bullish view could invalidate in the short term if the price turns down and breaks below the 20-day EMA. If that happens, the pair could gradually slide toward the strong support at $0.44.
Solana (SOL) plunged below the critical support of $37 on June 4 but a minor positive is that the bulls purchased at lower levels. This may have caught the aggressive bears off-guard, which resulted in a strong recovery as seen from the long tail on the day’s candlestick.
The RSI has formed a positive divergence, indicating that the bearish momentum may be reducing. The bulls are attempting to push the price above the 20-day EMA ($46). If they succeed, the SOL/USDT pair could rally to $55 and thereafter to $60.
On the contrary, if the price turns down from the 20-day EMA, it will suggest that the trend remains negative and bears are selling on rallies. The bears will then make one more attempt to resume the downtrend by pulling the pair below $35.
Dogecoin (DOGE) is stuck between the 20-day EMA ($0.08) and $0.08 for the past few days but this tight range trading is unlikely to continue for long.
If buyers push the price above the 20-day EMA, the DOGE/USDT pair could rally toward the psychological resistance at $0.10. This level may again act as a hurdle but if bulls overcome it, the pair could rally to $0.12.
Contrary to this assumption, if the price turns down from the 20-day EMA, it will suggest that bears continue to sell on minor rallies. If bears sink the price below $0.08, the pair could drop to $0.07. A break and close below this support will suggest the resumption of the downtrend.
Polkadot (DOT) has formed a symmetrical triangle, which usually acts as a continuation pattern. The buyers are attempting to push the price above the 20-day EMA ($10) and challenge the resistance line of the triangle.
A break and close above the triangle will be the first indication of a potential trend change. The DOT/USDT pair could rise to $12 and then attempt a rally to the breakdown level of $14. The bears are likely to defend this level aggressively.
Alternatively, if the price turns down from the overhead resistance and breaks below the triangle, it will suggest that bears are in control. The pair could then decline to $8 and later retest the May 12 intraday low of $7.30.
Avalanche (AVAX) bounced off $22.14 on June 4, indicating that bulls are defending the $21.35 support with vigor. The buyers have pushed the price above the downtrend line and are attempting to clear the overhead hurdle at the 20-day EMA ($28).
If they manage to do that, the AVAX/USDT pair could pick up momentum and start its northward journey toward $33 and then $37. Such a move will suggest that the bulls are back in the game.
Contrary to this assumption, if the price turns down from the 20-day EMA, it will suggest that bears remain active at higher levels. The pair could then slide toward $21.35. A break and close below this support could start the next leg of the downtrend.
The buyers have successfully defended the $0.000010 support for the past several days but they have not been able to push Shiba Inu (SHIB) above the 20-day EMA ($0.000012). This suggests that buying dries up at higher levels.
The tight range trading between $0.000010 and the 20-day EMA is unlikely to continue for long. If bears sink the price below $0.000010, the SHIB/USDT pair could retest the May 12 intraday low at $0.000009. A break and close below this level could signal the resumption of the downtrend.
Alternatively, if buyers propel the price above the 20-day EMA, the pair could rally to the overhead resistance at $0.000014. The bears are expected to mount a strong defense at this level.
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.
Source : cointelegraph.com
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