According to JPMorgan, institutional buyers are seeking to protect their portfolio from rising inflation. This is evident in Bitcoins (BTC), rally to above $50,000. Analysts at the bank speculated that institutional investors might prefer Bitcoin to gold as an inflation hedge.
Recent research by crypto asset management firm Iconic Funds, Cryptology Asset Group, entitled “Cryptocurrencies & the Sharpe Ratio Traditional Investment Models” showed that adding cryptocurrencies to a portfolio increased returns and risk-reward performance.
Everyday cryptocurrency market performance. Source: Coin360
Mike McGlone, a senior Bloomberg commodity strategist, stated in the October 2021 issue of the Bloomberg Galaxy Crypto Index, that Bitcoin might provide strong support for declines in the fourth-quarter.
Is this a sign of a long-term trend? Or could the recent surge in Bitcoin and other altcoins be profit-booking from traders? Lets look at the charts for the top 10 cryptocurrencies to see what happens.
Bitcoin saw profit-booking Oct. 7, but the bears couldnt pull the price below $52,920. This is a positive sign. Although the bulls attempted to re-establish the upward movement today, the candlesticks long wick suggests that sellers will be selling at higher levels.
Daily chart of BTC/USDT Source: TradingView
$52,920 is the first support. However, bears could pull the price down below this level. The BTC/USDT pair may drop to the psychological level of $50,000, then to the 20-day exponential moving mean ($48,285).
Buyers have an advantage due to the upwardly moving 20-day EMA (RSI) and relative strength index near the overbought area. The bulls will attempt to resume the uptrend if the price recovers from the 20-day EMA.
If the price breaks and closes above $56,100, it could propel the pair to $60,000 where bears might mount strong resistance. If the price falls below the 50-day SMA ($47,342), this positive view will be invalidated. The pair could then test the crucial 100-day SMA support ($42,691).
The recovery of Ether (ETH) rose above the immediate resistance at 3,676.28 today, but bulls may have difficulty maintaining the price above that level. The RSI is near the downtrend line which could be a resistance.
Daily chart of ETH/USDT Source: TradingView
The 20-day EMA ($3,324) is the first support if the price falls below the current level. If the price rebounds strongly from this level, it will be a sign that sentiment is positive and traders are buying dips.
This will increase the chances of a rally towards the $4,027.88 overhead resistance. If the price falls below the 20-day EMA the ETH/USDT pairing could fall to the 100 day SMA ($2,899).
Binance Coin (BNB), which is currently at $433, is not being sustained by the bulls. This suggests that there is less demand. Todays price is now below $433. The bears will attempt to lower the price below the $20-day EMA (409).
Daily chart BNB/USDT TradingView
The BNB/USDT pair may slide to the 100 day SMA ($379) if they succeed. This move could increase the chances that the pair will remain range bound between $320 to $450 over the next few days.
However, if the price bounces off the 20-day EMA it will indicate that traders are buying dips and the sentiment is still positive. The bulls will attempt to overcome the $450 overhead hurdle and begin the northward march towards $518.90.
After several unsuccessful attempts over the past few days the bulls were able to push Cardano (ADA), above the 20-day EMA ($2.25) Oct. 7. The candlesticks long wick showed that bears were active at higher levels, despite the fact that it was a longer candlestick.
Daily chart ADA/USDT Source: TradingView
The price action over the last few days has formed an asymmetrical triangle pattern. This indicates that bulls and bears remain undecided on the next directional move. The 20-day EMA ($2.47) and 50-day SMA ($2.47) remain flat, while the RSI is near 50. This indicates a balance between supply/demand.
If the price rises and breaks through the resistance line, this will favor the bulls. The ADA/USDT pairing could rally to $2.47, where bears might again put up stiff resistance. Breaking above this level could lead to a rally up to $2.80.
A break below the support line could lead to a drop in the price to the 100-day SMA ($1.96).
XRP created an inside-day candlestick structure on Oct. 7, indicating uncertainty among the bears and bulls. Today, the bulls attempted to solve the uncertainty to the upside but failed to overcome the overhead hurdle at SMA 50 ($1.09).
Daily chart of XRP/USDT Source: TradingView
If bulls push the price higher than the 50-day SMA, or bears lower the XRP/USDT exchange rate below the 20 day EMA ($1.03), the next directional move may be in the opposite direction. If the price breaks above the 50-day SMA, it could open the way for a rally to $1.41.
A break below the 20 day EMA could send the price down to the 100-day SMA ($0.92). This support has been defended by the bulls during previous retests, and they may try again to do so.
Solana (SOL), which was trading below the 20-day EMA ($153) in the last two days, has not been sunk by bears. This indicates that bulls are defending this level vigorously. This could have attracted short-term buying from bulls today, which may have resulted in a strong rebound.
Daily chart of SOL/USDT Source: TradingView
The buyers will attempt to increase the price above $177.80, the 61.8% Fibonacci level of retracement. The SOL/USDT pair may rally to $200 if they are able to pull it off. This would then push the price above the $177.80 Fibonacci retracement level at $177.80 and challenge the record high of $216.
Alternativly, if the price falls below the overhead resistance or current level, and the pair breaks below the 20 day EMA, it could slide to the 50 day SMA ($137). This level may be defended by the bulls, but if they fail to do so, the fall could extend to $116.
Dogecoin (DOGE), which was down from its downtrend line Oct. 6, but the bears were unable to lower the price below the $20 EMA ($0.23) on Oct. 7, indicating that buyers are likely to be at lower levels.
Daily chart of DOGE/USDT Source: TradingView
The 20-day EMA is up, and the RSI has moved into the positive zone. This suggests that bulls are in control. Bullish momentum will likely pick up if buyers push the price higher than the downtrend line.
The DOGE/USDT currency pair could rally to $0.32, and then to $0.35. Contrary to the assumption, if price moves in the opposite direction of the downtrend line, there is a possibility that it will break below the 20 day EMA. The pair could then fall to the $0.21- $0.19 support zone.
Related: Cynthia Lummis, a pro-crypto senator, discloses a purchase of up to $100K BTC
Polkadot, (DOT), broke above resistance at $33.60 Oct. 7, but the candlesticks long wick suggests that sellers should sell at higher levels. Todays inside-day candlestick pattern signals indecision between bulls and bears.
Daily chart of DOT/USDT Source: TradingView
The RSI has crossed the downtrend line, which had been acting as a strong resistance. The bears will attempt to lower the DOT/USDT price below $28.60 if the price drops from its current level.
The pair could also rise to $38.77 if bulls push the price higher than $35.31. While bears might try to defend this price aggressively, if bulls overcome resistance, the pair can rally to $42.60 or later to $49.78.
Terra protocols LUNA token rose sharply above the overhead resistance at $45.01 Oct. 7, but bulls couldnt clear the overhead hurdle of $49.54 today. This indicates that bears are defending the psychological level of $50.
Daily chart of LUNA/USDT Source: TradingView
Todays price fell below $45.01 and today the bears are trying to push it down to the 20 day EMA ($39.63). This support is important for bulls as it indicates that traders are buying dips and sentiment remains positive.
This will increase the chance of a break above 50. The LUNA/USDT pairing could begin the next leg in the uptrend towards $56.97, and then $65.97. A break below the 20 day EMA could lead to a fall to the 50-day SMA (34.92).
Uniswap, (UNI), seems to be forming right shoulder of bullish inverse head-and shoulders pattern. This will end on a break above the neckline.
Daily chart of UNI/USDT Source: TradingView
This could push the price up to $31.41 and, if it crosses the threshold, the rally could reach the pattern target of $36.98. The 20-day EMA (24.50) has begun to rise and the RSI is just below the midway. This suggests that the bulls have a slight advantage.
If the UNI/USDT price falls below $22 and the critical support, this positive view will be invalidated. The traders could rush to the exit if this happens, bringing the pair down to $18.
Risk is inherent in every investment or trading move. Before making any investment or trading move, you should do your research.
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I am a technology and gaming writer by profession. I love NFT’s and play to earn gaming such as Axie Infinity. I love writing about anything on the blockchain, especially gaming and entertainment. I often sing, write or draw to portray my feelings. When it comes to my free time or you can say ‘ME-TIME’, I love to play with my cat, sleep an extra hour, or play my favorite video games.