The cryptocurrency market has made a comeback in the past few days. That brought the total crypto market capitalization to $995 billion as of January 14, according to CoinMarketCap data. Bitcoin (BTC) led the recovery from the front and skyrocketed above $21,000 on January 14.
After the sharp rally, the big question is whether the recovery is a dead cat bounce that is a selling opportunity, or the start of a new uptrend. It is difficult to predict with certainty that a macro bottom has been created but the chart shows that the bottoming process has started.
Independent market analyst HornHairs suggests that the bear market from 2017 to 2018 lasted 364 days and from 2021 until the current market low, the duration is another 364 days. Another interesting similarity is that the 2015 to 2017 bull market and the 2018 to 2021 bull phase both lasted 1,064 days. If history repeats itself, then Bitcoin could be the next top in about 1,000 days.
Bitcoin’s short-term price action has been exciting for the bulls, but are any altcoins showing similar strength in the near term?
Let’s study the graph to find out.
BTC/USDT
Bitcoin shot up to $21,258 on January 13 and that pushed the relative strength index (RSI) above 89, signaling that the rally is overheated in the short term. Bears are expected to mount a strong defense at $21,500.
Sometimes, when there is a trend change, the RSI can stay in the overbought area for a long time. If the BTC / USDT pair does not give up much ground from the current level, it will suggest that traders are not in a hurry to book profits as they anticipate another higher leg.
If buyers push the price above $21,500, the pair could rise to $22,800. This level can again be a major roadblock.
On the way down, bears need to drag the price below the psychological level of $20,000 to make a dent in the bullish momentum. The pair could then drop to the breakout level of $18,388.
The 4-hour chart shows that the bears are maintaining the $21,250 level but a positive sign is that the bulls are not allowing the price to fall below $20,000. Buyers can again try to clear the overhead barrier at $21,258 and continue upward.
On the contrary, if the price drops back from $21,250, it may tempt short-term traders to take profits. That can put the pair below the 20-EMA. Bears can try to capitalize on this situation and pull the pair to $18,388.
LTC/USDT
Litecoin (LTC) broke above the overhead resistance at $85 on January 12, indicating the start of a new uptrend. There are no major hurdles until the price reaches $107.
On the downside, the bulls will try to defend the zone between $85 and the 20-day EMA ($79). If the price returns from this zone, the LTC/USDT pair may continue to rise and reach $107.
The advantage of the moving average signal is rising for bulls, but the RSI above 77 indicates that there is a pullback or a small consolidation.
If the bears want to gain the upper hand, they need to pull the price below the $75 breakout level. This could lead to a fall to $61.
The 4-hour chart shows the pair is in an uptrend and the bulls are strongly protecting the 20-EMA. If buyers push the price above $92, the pair could pick up momentum and rally to the psychological level of $100.
On the contrary, if the price falls and dives below the 20-EMA, it will suggest that the short-term trader can make a profit. That can pull the price for 50-SMA. This is an important level for bulls to defend as a break below could increase the risk of a drop to $80 and then $75.
OKB/USDT
While some cryptocurrencies are trying to go down, OKB (OKB) has started a new uptrend. Usually, it’s a good strategy to buy dips in an uptrend by keeping an appropriate stop loss.
The upsloping moving average and the RSI in the overbought area indicate that the bulls are in command but a short-term consolidation or correction cannot be ruled out. The OKB/USDT pair may enter the 20-day EMA ($27.64), which may be a strong support.
If the price rebounds from this level, the pair can touch the strong overhead barrier at $34.18. Crossing this level may be a difficult task, but if the bulls manage to achieve it, the pair can climb to $42.
If the bears want to stop the uptrend, they need to pull the price below the 20-day EMA. If successful, the pair can drop to the 50-day SMA ($24.05).
The 4-hour chart shows that the uptrend met with strong selling near $33 and the pair could correct towards the 20-EMA. If the price rebounds from this support, it will suggest that the bulls buy on every small dip. That could lead the price to $34.18.
For example, if the price falls below the 20-EMA, the correction can be deep into the 50-SMA. If the price rebounds from this level, the bulls will try to continue the upward trend but may face resistance at $31 and again near $33.
related: Bitcoin fails to convince that bottom is at $12K ‘still possible’
BIT/USDT
BitDAO (BIT) rallied strongly from $0.26 on December 27 to $0.53 on January 14, showing strong bullish momentum. Additionally, the shallow pullback on January 15 suggests that traders are not exiting their positions too quickly in anticipation of continued upward movement.
If the bulls push the price above the overhead resistance at $0.54, the BIT/USDT pair may continue to rise. The next resistance on the upside is at $0.68. Bears can pose a strong challenge at this level because the break and close above it can open the door to a possible rally to $0.80.
On the downside, the first support is at $0.46 and then the 20-day EMA ($0.42). A strong bounce from one of the supports will suggest that traders are buying on the decline. That could result in a $0.54 retest. Bears can take control if they drop the price below the 20-day EMA.
The 4-hour chart shows that the pair faces resistance near $0.54 but the bulls can defend the drop to the EMA 20. A strong rebound from this level will suggest that the bulls are buying in a shallow rejection. That could increase the prospect of a break above $0.54.
Alternatively, if the price drops and falls below the 20-EMA, some short-term traders can take profits. That can attract a couple to 50-SMA. If this level is also cracked, the pair could drop to $0.41.
FTM/USDT
Fantom (FTM) broke above the downtrend line on January 9, indicating a potential trend reversal. The breakout was followed by a sharp rally that pushed the RSI to a very overbought level.
A vertical rally is unsustainable, so it needs to pull back. The FTM/USDT pair could drop to the 38.2% Fibonacci retracement level of $0.30 and then to the 50% retracement level of $0.28.
If the price goes up from this zone, it will suggest a change in sentiment from selling in rallies to buying in dips. Bulls will then try to continue the recovery and drive the pair above $0.36. If they do, the pair could rise to $0.42.
Conversely, a break and close below $0.28 can pull the pair down to the 61.8% retracement level of $0.26. A deeper decline could break the bullish momentum and increase the likelihood of a range formation.
Both moving averages are up and the RSI is in positive territory, indicating gains for buyers. The pair could slide towards the 20-EMA, which could be a strong support. If the price rebounds from this level, the bull will try to continue the upward move.
Conversely, if the price falls below the 20-EMA, it will suggest that traders are aggressively taking profits after the recent rally. The pair can then extend the correction to the 50-SMA.
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