The bears are attempting to extend Bitcoin’s (BTC) record of nine consecutive red weekly candles to ten weeks, but the bulls are trying to avert this downside. Although sentiment remains negative, Arthur Hayes, the former CEO of derivatives giant BitMEX, expects bitcoin to bottom in the $25,000 to $27,000 range.
On-chain data from Glassnode suggests that smart money may have started hoarding bitcoins. Net outflows from major cryptocurrency exchanges reached 23,286 bitcoin on June 3, the highest since May 14.
Another positive sign of accumulation is that investment in bitcoin exchange-traded products (ETPs) was strong in May and has only increased in the first two days of June, according to an Arcane Research report. The ETP has 205,000 bitcoins under management, a new record.
Can Bitcoin turn on and start a recovery? If it does, could select altcoins follow the leader? Let’s take a look at the chart of the top 5 cryptocurrencies that could lead the relief rally.
Bitcoin fell below the 20-day exponential moving average ($30,459) on June 1. The bulls attempted to push the price above the 20-day EMA on June 2 and June 3, but the bears did not budge.
The bears will try to pull the price below the strong support level of $28,630. If they manage to do so, the BTC/USDT pair could drop to the crucial support level of $26,700. Buyers are expected to defend this support area with full force as if they fail to do so, the downtrend may resume.
On the upside, the bulls will need to push and sustain the price above $32,659 to suggest that a new uptrend could be starting. Bullish momentum is likely to increase above and above the 50-day simple moving average ($33,778). The pair can then rebound to the pattern target of $36,688 and after that to $40,000.
The 4-hour chart is showing that price action is turning lower. Although the bulls pushed the price above the 20-EMA, it is facing stiff resistance at the 50-SMA. This suggests that bears are active at a high level.
One minor positive in favor of the bulls is that they did not allow the price to drop below the $29,282 support level.
If the price rises from the current levels and breaks above the downtrend line, the bulls will attempt to push the pair towards the 200-SMA. Conversely, if the price declines below $29,282, the next stop could be at $28,630.
Cardano (ADA) broke above the downtrend line on May 31, but the bulls could not sustain the higher levels as seen from the long wick on the day’s candlestick.
Although the bears have successfully defended the downtrend line, there is a slight positive that the bulls kept the ADA/USDT pair above the 20-days EMA ($0.56). This increases the chances of a break above the downtrend line.
If this happens, the pair can rally to the 50-day SMA ($0.67), where the bears can again present a strong challenge. A further close above this level would indicate a possible change in trend. The pair can then rebound to the breakdown level of $0.74.
Contrary to this assumption, if the price falls and falls below $0.53, the bears will try to pull the pair to $0.50 and later to $0.44.
The 4-hours chart is showing price squeezed between the 200-SMA and 50-SMA, but this tight range trading is unlikely to continue for long. If the bulls push the price above the 200-SMA, the pair could attempt a rally to $0.64. A break and close above this level could open the doors for a potential rally towards $0.69.
Conversely, if the price declines and falls below $0.53, a selloff could pick up. The pair can then drop to $0.50 and later to $0.47.
Stellar (XLM) rose above the 20-day EMA ($0.14) on May 30, which was the first sign that selling pressure could be waning. The bears halted the up move near the 50-day SMA ($0.15), but they have not been able to sink and sustain the price below the 20-day EMA.
This shows that the bulls are buying a downside break from the 20-day EMA. If the bulls drive the price above the 50-day SMA, it would suggest the start of a sustained recovery. The XLM/USDT pair could then attempt a rally to $0.18 and later to the 200-days SMA ($0.21).
If the price turns lower and breaks below $0.13, this positive outlook will be invalidated in the near term. Such a move would indicate that demand dries up at higher levels. This can pull the pair down to $0.12. If this support also gives way, the bears will attempt to resume the downtrend by dropping the pair below the psychological level of $0.10.
The 4-hours chart is showing that the price is trading inside a symmetrical triangle. If the bulls push the price above the resistance line of the triangle, the pair could rally to $0.15 and then attempt a rally to the pattern target of $0.17.
Alternatively, if the price breaks below the current level, the bears will attempt to sink the pair below the triangle support line. If they do this, selling may accelerate and the pair may fall to the strong support level of $0.13.
related: 3 Reasons Why Ethereum Price Dropped 25% in June
The failure of Monero (XMR) to rise above the 50-day SMA ($202) may have prompted short-term traders to book profits. This pulled the price down to the 20-day EMA ($189).
The bulls are attempting to defend the 20-day EMA, but the lack of a strong bounce from it indicates weak demand. If the price sustains below the 20-day EMA, the next stop could be an uptrend line. A further close below this support could lead the price to $167.
Conversely, if the price bounces off current levels, buyers will attempt to break out of the 50-days SMA and the $210 resistance area. If they manage to do so, the XMR/USDT pair could extend its rally to $230.
The pair is declining inside a descending channel, which suggests a slight profit to sellers. If the bears pull the price below the channel, downside momentum could increase and the pair could drop to $167.
Alternatively, if the price moves back from the support line, buyers will try to push the pair higher above the channel. If they manage to do so, the pair may again attempt to break the upper resistance of $210.
mana / usdt
Decentraland (MANA) has failed to break above the 20-day EMA ($1.06) over the past several days, but a slight positive is that the bulls haven’t given up much ground. This suggests that the bulls are buying on the downside as they expect further upside.
If the bulls push the price above the 20-day EMA, it would signal that the bears are losing their grip. The MANA/USDT pair can then rise to upper resistance at $1.36. This is an important level to watch as a break and close above it may indicate that a bottom may be in place. After this the pair can rebound to $1.68.
Conversely, if the price declines and breaks below $0.90, it would indicate that the bears are not in a mood to give up their gains. The pair can then reclaim the important support at $0.60. The bears will need to pull the price below this support to signal a resumption of the downtrend.
The 4-hour chart shows that the pair is trading in a narrow range between $0.94 and $1.04. A gradual downside move to the 20-EMA and the RSI in the downside zone suggests a slight gain for sellers. If the bears pull the price below $0.94, the pair can drop to $0.90.
Conversely, if the bulls push the price above $1.04, it would indicate that demand is exceeding supply. This could open the door for a potential rally to stiff overhead resistance at $1.15.
If the price falls below this level, the pair may oscillate for some more time between $0.90 and $1.15. A break and close above $1.15 could suggest that buyers have the upper hand.
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, so you should do your own research when making a decision.