Bitcoin, Ethereum and certain altcoin projects will continue to rally despite the February drop, according to crypto analyst Rakesh Upadhyay. Can altcoins continue their upward move as Bitcoin consolidates in the near term? The analyst examines Bitcoin charts and selects altcoin projects that may perform better in the next few days.
Has Bitcoin price bottomed out?
However, opinions are divided on whether Bitcoin has bottomed out. While some analysts expect the rally to reverse direction and sink below November lows, others believe markets will continue to rise and disappoint traders who expect to buy at lower levels.
Crypto market data daily view / Source: Coin360As you follow on Kriptokoin.com, the founder and CEO of Morgan Creek Capital Management, Mark Yusko, says that the ‘crypto summer’ may begin in the second quarter of this year. Moreover, he expects risk assets to rise if the US Federal Reserve signals that it will slow or stop interest rate hikes. Another potential bullish catalyst for Bitcoin is the block reward halving in 2024. Now it’s time for analysis…
Let’s look at Bitcoin (BTC) first
Bitcoin has been gradually correcting itself since reaching $24,255 on February 2. This shows short-term investors taking profits. The price is approaching the strong support zone between $22,800 and $22,292. The 20-day exponential moving average ($22,436) is also located in this region, so buyers are expected to defend the area with all their might.
BTC daily chart / Source: TradingViewThe 20-day EMA and the relative strength index (RSI) rising in the positive territory suggest that the bulls have the upper hand. If the price breaks out of the support zone, the bulls will again try to push BTC to $25,000. This level should act as a tough resistance. On the downside, a break below the support zone could trigger a few stop losses, which could initiate a deeper pullback. BTC could drop to $21,480 first and if this support fails to hold, the next stop could be the 50-day simple moving average ($19,572).
BTC 4-hour chart / Source: TradingViewThe 4-hour chart shows that the price is trading in an ascending channel but the RSI has formed a negative divergence. This indicates that the bullish momentum may weaken. A break and close below the channel could turn the short-term advantage in favor of the bears. BTC could drop to $21,480 later. Alternatively, if the price bounces back from the support line of the channel, the bulls try to push BTC above the channel again. If they succeed, BTC could resume its uptrend.
Leading altcoin Ethereum (ETH)
ETH has been trading near the $1,680 resistance for the past few days. Usually, a tight consolidation near an overhead resistance dissolves to the upside.
ETH daily chart / Source: TradingViewThe rising 20-day EMA ($1,586) points to the advantage for buyers, while the negative divergence in the RSI indicates that the bulls may be losing control. If the bulls want to continue their dominance, they will have to push and sustain the price above $1,680. If they do, ETH could rally to $1,800. This level can act as a resistance again. However, if the bulls do not allow the price to drop below $1,680, the rise could extend to $2,000. Instead, if the price drops and dips below the 20-day EMA, ETH could drop to $1,500. This is an important support level to watch. Because a bounce here could keep ETH stable between $1,500 and $1,680. On the other hand, if the $1,500 support is broken, ETH could decline to $1,352.
ETH 4-hour chart / Source: TradingViewThe 4-hour chart shows that the bears are pushing the price below the 20-EMA. This is the first indication that the bulls may take a step back. There is a minor support at the 50-SMA but if it fails to hold, ETH could drop to $1,550 and then $1,500. Conversely, if the price rises from the moving averages, the bulls will try to push ETH back above the overhead resistance. If they are successful, the altcoin could resume its uptrend.
The second altcoin to continue the rally is OKB (OKB)
While most cryptocurrencies are well below their all-time high, OKB hit a new high on Feb. This shows that the bulls are in command.
OKB daily chart / Source: TradingViewSome traders can take profits near the overhead resistance of $44.35 as it can act as a tough resistance. If the price drops from the current level but bounces back from the 20-day EMA ($37), it will show that the bulls continue to take the dips. This could increase the likelihood of a break above $45. The altcoin could skyrocket to $50, then to $58. If the price drops and dips below the 20-day EMA, it will indicate that traders are rushing to the exit. The altcoin could then drop to $34 and then to the 50-day SMA ($30).
OKB 4-hour chart / Source: TradingViewThe 4-hour chart shows that the bears are struggling to maintain the $44.35 level. OCD can bounce back and reach moving averages. This is an important support to follow. If the price bounces off the moving averages, the bulls will try to break through the $45 barrier again and start the next leg of the uptrend. Conversely, if the price breaks below the 50-SMA, selling could intensify and OKB could drop to $36 and then to $34. Such a move could delay the resumption of the uptrend.
Other altcoin with bullish potential Algorand (ALGO)
ALGO’s recovery hit the $0.27 breakout level on Feb. The bears defended this level but the bulls did not leave much ground. This indicates that the bulls are waiting for the relief rally to continue.
ALGO daily chart / Source: TradingViewThe rising 20-day EMA ($0.24) and the RSI in the positive zone suggest that the bulls have the upper hand. If the price rises from the 20-day EMA, the probability of a move above $0.27 increases. ALGO could then go to $0.31, where the bears may try to offer strong resistance. If the price drops from this level but bounces off $0.27, it will indicate that the bear trend may be coming to an end in the short term. The altcoin could try to rise to $0.38 later. This positive view could be invalidated in the near term if ALGO turns down from the current level and slides below $0.23. ALGO could then drop to the 50-day SMA ($0.21).
ALGO 4-hour chart / Source: TradingViewThe 4-hour chart shows the bears holding the $0.27 level. A minor positive, however, is that the bulls have not allowed the price to stay below the 50-SMA. If the price rises from the current level, the bulls will try to break through the general hurdle again. If they do, ALGO could gain momentum and rally to $0.31. Contrary to this assumption, ALGO risks falling to $0.23 if the price continues and breaks below the moving averages. The bears will have to smash this support to gain the upper hand.
Finally, Theta Network (THETA)
THETA successfully completed the retest of the breakout level on February 1. This indicates that the bulls have turned the downtrend line to support.
THETA daily chart / Source: TradingViewThe bulls will try to push the price towards the overhead resistance of $1.20. This level could act as a minor hurdle but THETA could extend its upward move to $1.34 if the bulls don’t give up too much at $1.20. This is an important level for bears to defend. Because if this resistance is broken, the altcoin can rise to $ 1.65. If the bears want to stop the bulls, they will have to quickly push the price below the 20-day EMA. THETA could then drop to $0.97 and then to the 50-day SMA ($0.89).
THETA 4-hour chart / Source: TradingViewTHETA bounced off the $0.97 level, which has become an important level to watch out for on the downside. Violation of this level could turn the advantage in favor of the bears and open the doors for a possible drop to $0.85. The rally faces resistance near $1.20. However, the rising 20-EMA and RSI in the positive territory suggest the path of least resistance to the upside. If buyers push the price above $1.20, momentum could bring a rally towards $1.34.
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