After an impressive rally in January, Bitcoin (BTC) seems to be taking a breather in February. This is a positive sign because vertical rallies are rarely sustainable. Small declines can take away the jitters and give long-term investors an opportunity to increase their position.
Has the price of Bitcoin been lower?
Opinion remains divided, however, whether Bitcoin has bottomed out or not. Some analysts expect the rally to reverse direction and nosedive below the November low while others believe the market will continue to rise and frustrate traders who are waiting to buy at lower levels.
In an interview with Cointelegraph, the founder and CEO of Morgan Creek Capital Management Mark Yusko said that the “crypto heat” could start in the second quarter of this year.
He expects risk assets to become bullish if the United States Federal Reserve signals that it will slow or pause interest rate hikes. Another potential bullish catalyst for Bitcoin is the block reward halving in 2024.
Can altcoins continue to rise while Bitcoin consolidates in the near term? Let’s study the Bitcoin chart and pick the altcoins that can do better in the next few days.
BTC/USDT
Bitcoin has gradually corrected since hitting $24,255 on February 2. This refers to profit orders by short-term traders. The price is close to a strong support zone between $22,800 and $22,292. The 20-day exponential moving average ($22,436) is also in this zone, so buyers are expected to defend the zone with all their might.
The rising 20-day EMA and the relative strength index (RSI) in positive territory indicate that bulls have an edge. If the price rises from the support zone, the bulls will again try to catapult the BTC / USDT pair to $25,000. This level should act as a strong resistance.
On the downside, a break below the support zone may result in multiple stop losses and may initiate a deeper pullback. The pair could first drop to $21,480 and if this support also fails, the next stop could be the 50-day simple moving average ($19,572).
The 4-hour chart shows that the price is trading in an upward channel but the RSI has formed a negative divergence. This suggests that the bullish momentum may be weakening. A break and close below the channel can tilt the short-term advantage in favor of the bear. The pair could then drop to $21,480.
Alternatively, if the price rebounds from the support line of the channel, the bulls will again try to push the pair above the channel. If it works, the pair can continue to climb.
ETH/USDT
Ether (ETH) has been trading near the $1,680 resistance for the past few days. Usually, a tight consolidation near overhead resistance decides the upside.
While the upsloping 20-day EMA ($1,586) indicates an advantage for buyers, the negative divergence in the RSI indicates that the bulls may be losing their grip. If the bulls want to assert their dominance, they need to push and maintain the price above $1,680.
If they do, the ETH/USDT pair could rally to $1,800. This level can again act as resistance but if the bulls do not allow the price to fall below $1,680, the rally could reach $2,000.
However, if the price declines and falls below the 20-day EMA, the ETH/USDT pair may fall to $1,500. This is an important support level to monitor as a bounce here could maintain a gap between $1,500 and $1,680. On the other hand, if $1,500 supports the crack, the pair can dive to $1,352.
The 4-hour chart shows that the bear has pulled the price below the 20-EMA. This is the first indication that the cow may be backing off. There is minor support at the 50-SMA but if it fails to hold, the pair could slide to $1,550 and then to $1,500.
On the contrary, if the price rises from the moving average, the bulls will again try to push the pair above the overhead resistance. If successful, the pair can continue their ascent.
OKB/USDT
While most cryptocurrencies are also below all-time highs, OKB (OKB) reached a new high on February 5. This shows that the bulls are in command.
Some traders can take profits near the $44.35 overhead resistance as it may be a strong resistance. If the price drops from the current level but rebounds to the 20-day EMA ($37), it will suggest that the bulls continue to buy dips.
That could increase the possibility of breaking above $45. The OKB/USDT pair may first rise to $50 and then to $58.
If the price drops and falls below the 20-day EMA, it will indicate that the trader can exit quickly. The pair can then drop to $34 and later to the 50-day SMA ($30).
The 4-hour chart shows that the bears are trying to protect the $44.35 level. The pair can resist and reach its moving average, which is an important support to watch. If the price bounces off the moving average, the bulls will try again to overcome the barrier at $45 and start the next leg of the uptrend.
On the contrary, if the price falls below the 50-SMA, selling may increase and the pair may drop to $36 and then to $34. The move could delay the uptrend again.
related: Fantom’s 5 week winning streak is in danger – Will FTM price lose 35%?
SOMETHING/USDT
Algorand Recovery (ALGO) reached the $0.27 breakdown level on February 3. Bears are defending this level but the bulls haven’t given up yet. This indicates that the bulls expect the relief rally to continue.
Upsloping 20-day EMA ($0.24) and RSI in positive territory indicate that bulls have the upper hand. If the price rises from the 20-day EMA, the probability of a break above $0.27 increases. The ALGO/USDT pair may then travel to $0.31 where bears may try to offer strong resistance.
If the price drops from this level but rebounds to $0.27, it will indicate that the downtrend may end in the short term. The pair could then try to rally towards $0.38.
This positive view may become invalid in the near term if the pair declines from current levels and slides below $0.23. The pair can then dive to the 50-day SMA ($0.21).
The 4-hour chart shows that the bears maintain the level of $0.27 but a small positive is that the bulls do not allow the price to stay below the 50-SMA. If the price rises from the current level, the bull will again try to clear the overhead hurdle. If they do, the pair could pick up momentum and rise to $0.31.
Contrary to this assumption, if the price continues and breaks below the moving average, the pair risks dropping to $0.23. Bears need to smash this support to gain the upper hand.
THETA/USDT
Theta Network (THETA) successfully completed a retest of the breakout level on February 1, indicating that the bulls have turned the downtrend line into support.
The bulls will try to push the price to overhead resistance at $1.20. This level may be a small obstacle but if the bulls do not give up from $1.20, the THETA/USDT pair may increase upwards to $1.34. This is an important level for bears to defend because if this resistance crumbles, the pair can soar to $1.65.
If the bears want to stop the bulls, they need to quickly pull the price below the 20-day EMA. The pair could then drop to $0.97 and later to the 50-day SMA ($0.89).
The pair rose above the $0.97 level, which is an important level to watch out for. A release of this level is likely to tilt the advantage in favor of the bear and open the door to a possible drop to $ 0.85.
The rally faces resistance near $1.20 but the 20-EMA is up and the RSI is in positive territory indicating that the path of least resistance is up. If buyers push the price above $1.20, momentum should pick up for a rally to $1.34.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should do their own research when making decisions.