Uncertainty about the Federal Reserve’s upcoming rate hike is putting altcoins including Bitcoin and SHIB under pressure. However, this could change if the expected 0.75% basis point increase is chosen. Crypto analyst Rakesh Upadhyay, “Can Bitcoin and altcoins make a comeback or is there a deeper drop on the horizon?” seeks an answer.
An overview of the cryptocurrency market
US equities and crypto markets will remain volatile in the near term as traders are nervous about the size of the next Federal Reserve rate hike on September 20 and 21. As you follow on Kriptokoin.com, the majority is in favor of an increase of 75 basis points. However, some analysts expect the Fed to raise interest rates by 100 basis points for the first time since the early 1980s, according to the CME FedWatch Tool.
Many predict that Bitcoin (BTC) will continue to decline. It also expects it to fall below its June low in the future. Anything is possible in the markets. However, most of the time the markets do not enforce the majority. If the Fed doesn’t surprise the markets, it’s possible for cautious, marginal traders to jump right back in. This, too, could result in a short relief rally.
Daily cryptocurrency market performance / Source: Coin360Bear markets give investors the opportunity to save in the long run. Catching the bottom is a futile effort. Therefore, traders may start to accumulate during periods of extreme pessimism. It takes a strong stomach to get over the volatility. Only those who do are likely to benefit when the next bull run begins. Now it’s time for analysis…
BTC, ETH, BNB, XRP and ADA analysis
Bitcoin (BTC)
Bitcoin has been in a strong downtrend for several months. Buyers started to recover from the June low of $17,622 and pushed the price above the 200-week simple moving average (SMA). However, they were unable to sustain higher levels.
The bulls tried to push the price back above the 200-week SMA last week. But the bears held their ground. This shows that the bears are fiercely defending the 200-week SMA. Hence, this level becomes an important resistance to watch on the upside.
On the downside, the bulls are likely to defend the support aggressively at $17,622. The first sign of strength will be a breakout and a close above $20,000. This would suggest a range-bound trade between $17,622 and $25,211 for BTC. A trend change signal will be given after buyers push the price above $25,211. It is possible for BTC to rally to $32,000 later. Conversely, if the bears sink and sustain the price below $17,622, it will likely signal a resumption of the downtrend. BTC is likely to drop to $14,000 later.
Ethereum (ETH)
The bears have been defending the 20-week exponential moving average (EMA) ($1,732) for the past few weeks. This shows that sentiment in Ether is bearish and traders are selling in rallies.
ETH fell sharply from the 20-week EMA last week. Thus, it reached the 200-week SMA ($1,283). Buyers will likely fiercely defend this level. The bulls will need to push and sustain the price above the 20-week EMA to indicate that the bears may lose control. A potential trend change signal is possible on a break above $2,030. Until then, the bears will likely sell on every rally. If the price breaks below the 200-week SMA, intensification of selling is likely. In this case, the bears will try to push the price down to the June low of $881. This is an important level for the bulls to defend. Because it is possible for a break below this to lead to panic selling.
Binance Coin (BNB)
BNB traded well above its 200-week SMA ($175). That’s why it’s one of the top performers among major cryptocurrencies. Buyers pushed the price above the 20-week EMA ($295). However, they could not develop this power. The bears stopped the recovery at $338 and dragged the price below the 20-week EMA.
Since then, the bears have blocked several attempts by the bulls to push the price above the 20-week EMA. This indicates that the bears are selling the rally to the 20-week EMA. The bears will attempt to lower BNB to the 200-week SMA. This is also likely to attract strong buying from the bulls. The first sign of strength will be a break above the 20-week EMA. This is likely to clear the way for a $338 retest. The bulls will have to break through this general hurdle to suggest the start of a new upward move.
Ripple (XRP)
XRP has been consolidating in a downtrend for the past few weeks. Buyers tried to push the price above the resistance of the range at the $0.41 level last week. But the bears successfully defended the level.
Sellers will try to push the price towards support at $0.30. This remains an important level to focus on. Because if the bears sink the price below $0.30, it is possible for XRP to start the next leg of the downtrend. XRP is likely to drop to $0.24 and then $0.17 later. The 20-week EMA is flattening. This indicates that the selling pressure will weaken. If the price bounces back from $0.30, XRP could extend its stay in the range for a few more days. Buyers will have to push and sustain the price above the 200-week SMA ($0.48) to indicate that XRP has bottomed out.
Cardano (ADA)
ADA has been trading below the moving averages for the past few weeks. Attempts by the bulls to push the price above the 200-week SMA ($0.57) were met with strong selling by the bears.
The bulls have held the $0.40 support for the past few weeks. However, it failed to push the price above the 200-week SMA. This shows that the bears are selling in the rallies. The bears will try to push the price below the support at $0.40. If they are successful, ADA is likely to continue the downtrend. The next support on the downside is $0.33 followed by $0.28.
If the bulls want to avoid this disaster, they will have to quickly push the price above the 200-week SMA. It is possible that the bears are again trying to create a strong challenge at $0.70. But if the bulls break through this hurdle, it will likely indicate the start of a new uptrend of ADA. Later, it is possible for ADA to rally to the 50-week SMA ($0.96) and then to $1.25.
SOL, DOGE, DOT, MATIC and SHIB analysis
Left (LEFT)
SOL rebounded from June’s low of $26. However, the recovery gushed near $48. The failure of the bulls to push the price to the 20-week EMA ($46) indicates that the bears are selling on minor rallies.
The bears will try to push the price towards the critical support of $26, which has not been tested since June. If this support is broken, it is possible for the sell to gain momentum and the SOL to drop to $20. The bulls will likely defend this level aggressively. Alternatively, if the price rises from the current level or bounces back at $26, the bulls will try to push the SOL back to the overhead resistance at $48. Buyers will have to clear this hurdle to signal the start of a new uptrend. ADA is likely to attempt a rally to $78 later.
Dogecoin (DOGE)
DOGE rebounded from $0.05 in June and reached the 20-week EMA ($0.08) in August. However, the bulls failed to push the price above this resistance. The bears have aggressively defended the level and are trying to push the price down to $0.05.
If the $0.05 support is broken, DOGE is likely to resume its downtrend. The next support on the downside is at $0.04. However, if the bulls fail to maintain this level, it is possible that the selling will intensify and DOGE drops below $0.01. There is a small glimmer of hope for the bulls. Because the RSI is trying to form a positive divergence. This indicates that selling pressure may decrease. If the price bounces back from $0.05, the bulls will try to push DOGE back above $0.09. If this happens, DOGE is likely to rise to the 50-week SMA ($0.13).
Polkadot (DOT)
DOT has been consolidating between $6 and $10 for the past few weeks. Usually in a range, traders buy dips to support and sell near overhead resistance.
If the price recovers strongly from the $6 support, it indicates that buyers are accumulating on the downside. This will probably keep the DOT in range for a while longer. The longer the price trades within a range, the stronger the eventual breakout from it will be. If buyers push the price above $10, it likely indicates the end of the downtrend. It is possible that this could clear the way for a possible rally to the 50-week SMA ($19). On the contrary, if the price breaks below the $6 support, the DOT is likely to start the next leg of the downtrend. The DOT is likely to drop into the $3.50 to $4 support zone later on.
Polygon (MATIC)
MATIC rose sharply from $0.31 in June and broke above the 20-week EMA ($0.87). But buyers failed to prolong the recovery. The bears stopped the aid rally at $1.05 and dragged the price below the 20-week EMA.
The bulls tried again last week to try and sustain the price above the 20-week EMA. But the bears did not give up. They aggressively sold and pushed the price to the immediate support of $0.72. If this support breaks, a drop to $0.45 and then $0.31 is possible for MATIC. On the contrary, if the price rises from the current level and rises above the 20-week EMA, MATIC is likely to challenge the overhead resistance at $1.05. A break and close above this level indicates the end of the downtrend. The price is likely to rally to the 50-week SMA ($1.31) later on, and then to $1.75.
Shiba Inu (SHIB)
SHIB rose sharply from June lows and broke above the 20-week EMA ($0.0000013) in August. However, the breakout proved to be a bear trap as SHIB price dropped from $0.000018 and settled below the 20-week EMA.
Although SHIB price traded below the 20-week EMA, the bulls did not allow it to retest the June low at $0.000007. This indicates that buyers are attempting to form a higher low.
The first sign of strength will be a break and close above the 20-week EMA. SHIB could then rally to $0.000018. If the bulls push the price above this resistance, it will suggest a potential trend change. SHIB could then rally to $0.000030. This positive view is likely to be invalidated if the price continues to decline and slides below $0.000007. It is possible that this will bring the SHIB down to $0.000005.
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