Bitcoin price looks ready to consolidate after reaching a new 2020 high and altcoins may attempt to recover from their sharp losses.
Within the last 24-hours, Bitcoin (BTC) price hit an intraday high of $18,466.14 and this is just roughly 8% lower than the magical $20,000 figure being watched by many traders.
However, investors in several countries such as Russia, Argentina, Brazil, and Mexico have already seen their Bitcoin holdings hit a new all-time high in their local currency. Even Bitcoin’s market capitalization has hit a new record high, topping the high created in December 2017.
With institutional investors finally arriving in herds, it seems it is only a matter of time before Bitcoin finally overtakes $20,000 and sets a new all-time high.
Adding to the list of high profile billionaire’s acquiring Bitcoin, Ricardo Salinas Pliego, Mexico’s second-richest man, recently announced that he had invested in the digital asset. Accordion to Pliego, 10% of his liquid assets are held in Bitcoin.
Daily cryptocurrency market performance. Source: Coin360
Even existing investors have added to their holdings. Galaxy Digital chairman and CEO Mike Novogratz recently said that he had purchased more Bitcoin at $15,800 as he expects a rally to $65,000. Novogratz believes that “the network effect has taken over” and with “tons of new buyers” coming in, the limited supply will not be enough.
The steady institutional inflow has resulted in Grayscale Investments Bitcoin holdings surging to over 500,000 Bitcoin. An annual survey from the company revealed that about 38% of the respondents have bought Bitcoin in the past four months. 63% of these investors said that the coronavirus pandemic was the main factor that influenced their decision to purchase Bitcoin.
After today’s spectacular rally, many investors are searching for hints on whether Bitcoin will continue its uptrend or correct sharply from the current levels.
Let’s analyze the top-10 cryptocurrencies to see what the charts project.
Bitcoin’s (BTC) momentum was very strong in the past two days and while many investors believed that $17,200 would serve as a major resistance, the price sliced right through it with ease.
However, the cryptocurrency has been running hard since early October and it may soon tire out if it keeps proceeding at the current pace.
BTC/USD daily chart. Source: TradingView
If it takes a break to regroup and then resume the uptrend, this would be a positive as it would all the current rally to have longer staying power. The price has currently formed a Doji candlestick and this shows there is indecision among the bulls and the bears.
If the price corrects to the 20-day exponential moving average ($15,528), placed just above the 38.2% Fibonacci retracement level, it may be considered a healthy sign.
Even if the price does not correct, a range-bound action between $16,500 and $18,500 will be positive.
Contrary to this assumption, if the momentum drives the BTC/USD pair to new highs without any pullback, then the possibility of the record highs sustaining will be lowered. At that time, a correction could be vicious as there is no major support until $12,500.
The relative strength index (RSI) has been trading between 70 and 84 for about a month, which shows that the trend is strong but also overextended. Hence, at the risk of missing out on some part of the rally, traders should keep their greed in check and trade with suitable stop losses.
Ether (ETH) inched above the overhead resistance at $488.134 today but the bulls could not sustain the breakout. This shows that the bears are defending the overhead resistance aggressively.
ETH/USD daily chart. Source: TradingView
However, if the bulls do not allow the price to dip below the 20-day EMA ($442), it will suggest accumulation at lower levels. If the price consolidates near the overhead resistance, it will increase the possibility of a break above it.
If the ETH/USD pair sustains above $488.134, the rally could extend to $520 and then to $550.
On the other hand, if the bears sink the price below the 20-day EMA, it will suggest that the momentum has weakened. A break below the 50-day simple moving average ($399) will tilt the advantage in favor of the bears.
XRP reached its first target objective at $0.303746 on Nov. 17 and short-term traders seem to have booked profits at this level as seen from the sharp correction today. However, the bulls are trying to arrest the decline at the 50% Fibonacci retracement level of $0.278123.
XRP/USD daily chart. Source: TradingView
If they succeed, then another attempt to push the price above the $0.308176 resistance is likely. The next level where the bears may again launch a stiff resistance is $0.326113.
The upsloping moving averages and the RSI near overbought territory suggest that bulls have the upper hand.
Contrary to this assumption, if the XRP/USD pair dips below $0.278123, a decline to the 20-day EMA ($0.264) is likely.
Chainlink (LINK) broke above the $13.28 overhead resistance on Nov. 17 but the bulls are struggling to sustain the breakout. This suggests that the bears are attempting to sink the price back below the breakout level.
LINK/USD daily chart. Source: TradingView
If the LINK/USD pair breaks and sustains below the 20-day EMA ($12.26), it will invalidate the bullish inverse head and shoulders pattern.
Conversely, if the bulls manage to sustain the price above the breakout level of $13.28, the pair could start its journey towards the target objective of $19.2731. The upsloping moving averages and the RSI above 59 suggest that bulls are in command.
Litecoin (LTC) is currently witnessing a pullback in an uptrend but the long tail on the candlestick shows strong buying at the breakout level of $68.9008. This suggests that the bulls have managed to flip $68.9008 as support. This level may now act as a floor during future declines.
LTC/USD daily chart. Source: TradingView
The rising moving averages and the RSI in the positive zone suggest that the bulls are in control. They will now attempt to push the price above the $77.20 resistance and resume the uptrend. If they succeed, the LTC/USD pair could rally to $100.
On the contrary, if the bears sink the price below the immediate support at $68.9008, it will suggest that the momentum has weakened. A break below the 20-day EMA ($62.92) could signal that the bears have made a strong comeback.
Bitcoin Cash (BCH) continues to face stiff resistance at the 20-day EMA ($255). This is a negative sign as it suggests that the bulls are not able to absorb the selling by the bears and push the price higher.
BCH/USD daily chart. Source: TradingView
The price has broken below the moving averages and the bears will now try to sink the BCH/USD pair below the immediate support at $242. If they succeed, the pair could drop to the $231 support.
A break below $231 will increase the likelihood of a fall to $200 but if the pair rebounds off $231, the range-bound action may continue for a few more days. The flat moving averages and the RSI in the negative territory suggest a minor advantage to the bears.
Polkadot (DOT) bounced off the 20-day EMA ($4.41) on Nov. 16 and reached the overhead resistance at $4.95 on Nov. 17. The bears are currently trying to defend the resistance and keep the altcoin range-bound for a few more days.
DOT/USD daily chart. Source: TradingView
However, the gradually upsloping 20-day EMA and the RSI in positive territory suggest that bulls have the upper hand.
If the price rebounds off the 20-day EMA, the buyers may once again attempt to clear the hurdle at $4.95. If they can do that, the DOT/USD pair could move up to $5.5899.
Contrary to this assumption, if the pair breaks below the moving averages, the range-bound action between $3.80 and $4.95 could continue for a few more days.
The bulls failed to propel Binance Coin (BNB) above the $27.30 to $28.97 range today as the price turned down from the overhead resistance. This suggests that buying dries up at higher levels.
BNB/USD daily chart. Source: TradingView
However, this tight range trading is unlikely to continue for long. Soon, the BNB/USD pair will either break above or below the range. It is difficult to predict the direction of the breakout because the indicators are suggesting a balance between supply and demand.
Therefore, it is better to wait for the price to escape the range before placing large bets. If the bulls push the price above the range, a rally to $32 is possible. Conversely, if the bears sink the price below $27.30, the pair could retest the critical support at $25.6652.
The bulls pushed Cardano (ADA) above the downtrend line on Nov. 17 but they have not been able to clear the hurdle at $0.1142241. This suggests that the bears are defending this overhead resistance.
ADA/USD daily chart. Source: TradingView
However, if the ADA/USD pair does not dip back below the downtrend line, the bulls will once again try to propel the price above the overhead resistance. If they manage to do that, the pair will complete a double bottom pattern that has a target objective of $0.1391.
If the RSI breaks and sustains above 60, it could signal a possible pick up in momentum that could result in a break above $0.1142241. This bullish view will be invalidated if the pair breaks below the $0.098822 support.
Bitcoin SV (BSV) rallied above the downtrend line on Nov. 17 but the bulls have not been able to sustain the momentum. This suggests that traders are closing their positions even on minor rallies.
BSV/USD daily chart. Source: TradingView
The bears are currently trying to sink the BSV/USD pair back below the downtrend line, while the bulls are attempting to achieve a close above it. The flat moving averages and the RSI close to the midpoint does not give a clear advantage either to the bulls or the bears.
A close above the downtrend line could increase the possibility of a rally to $181 while a close below the line may result in a drop to $146. The next trending move could start after the pair breaks above or below the $181 to $146 range.
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.