On Sept. 24, the crypto market was hit hard by news that Chinas government had adopted a new set if measures to strengthen interdepartmental coordination and “cut off payment channels”, dispose of relevant websites, and mobile apps” in order to combat illegal cryptocurrency transactions.
Even though the news caused some selloff, investors who are long-term will not be affected by it. The only thing that has changed is the announcement of additional measures to enforce existing bans.
Everyday cryptocurrency market performance. Source: Coin360
China announced the ban on cryptocurrency in September 2017. This news also led to a sharp correction of Bitcoin (BTC). The price rebounded within weeks, and then reached a new record high of $20,000 in three months.
Are the current corrections in Bitcoin and other major altcoins a buying opportunity? Or could they make the markets fall further? Lets look at the charts for the top 10 cryptocurrencies to see how they compare.
Bitcoin rose above the neckline for the head and shoulders pattern, surpassing the $100-day simple moving Average ($40.874) on Sept. 22. This showed that there was strong demand at lower levels, but it could not overcome the hurdle at the $20 exponential moving average ($45.596).
Daily chart of BTC/USDT Source: TradingView
Bears are in control of the situation thanks to the downsloping 20 day EMA and the relative weakness index (RSI), which is located in the negative zone. The BTC/USDT pair may drop to $37.332.70 if bears continue to sink below the 100-day SMA.
This level could act as a strong support, but if it fails, the next stop could at the pattern target at $22,423.05.
Contrary to the assumption, if the price rises from the current level, or the 100-day SMA ($46,816), then the bulls will attempt to drive the pair higher than the moving averages. The correction could be ended if the price closes above the 50-day SMA ($46816)
Ether (ETH), rebounded from the 100-day SMA ($2,734) Sept. 22, and rose above the breakeven level of $3,000. This indicates that bulls bought the dip to trap aggressive bears.
Daily chart of ETH/USDT Source: TradingView
The recovery has stalled at $3.174.50 on September 23rd and the bears are trying to reclaim their dominance. Bears are in control of the downsloping 20 day EMA ($3,255), and the RSI at 41.
The ETH/USDT pair may see aggressive selling if the index falls below the 100-day SMA. The pair could drop towards $1,972.12. If bulls continue to drive the price higher than the moving averages, this negative view will be invalidated.
Cardanos strong rebound from the $1.94 level to the ADA hit a roadblock at $2.36, the 20-day EMA. This indicates that sentiment is still negative and traders are buying rallies to 20-day EMA.
Daily chart ADA/USDT Source: TradingView
The bears will attempt to lower the price below $1.94, the critical support area ($1.83) and the 100-day SMA ($1.83). The ADA/USDT pair may plummet to $1.60, then to $1.40 if they succeed.
The bulls may also attempt to overcome the overhead hurdle if the price goes up from its current level or reboundes off $1.94. The first sign that the correction is over may be a break above the 20-day EMA. The pair could rally to $2.60, then $2.80.
Binance Coin (BNB), rebounded from the strong support at $340, turned down at $385.30 today. This indicates strong selling by traders on higher levels.
Daily chart BNB/USDT TradingView
The bears have control of the market, as evidenced by the RSI below 37 and the downsloping 20 day EMA ($402) The selling could accelerate if the $340 support breaks and the BNB/USDT pairing could fall to $300, and then to $250.
Contrary to popular belief, bulls will attempt to increase the price above the moving medians if the price recovers from its current level. The correction could be over if the price breaks below $433 or closes above $433.
XRP recovered from the 100-day SMA ($0.87) in Sept. 22, but the bulls couldnt extend their recovery. On Sept. 23, the altcoin created a Doji candlestick pattern, indicating indecision between the bulls and bears.
Daily chart of XRP/USDT Source: TradingView
Todays uncertainty has been resolved by bears who have brought the price to the 100-day SMA. The selling momentum could increase if this support is breached and the XRP/USDT exchange pair could fall to $0. 70
Although this level can act as a strong support, bears could sink the price below the SMA to $0.50. If the price rises above the $1.07-$1.13 resistance zone and bounces off the 100 day SMA, this negative outlook will be negated.
Solana (SOL), bounced and rose above its 20-day EMA ($145) Sept. 22, but the bulls couldnt push the price above the downtrend. This indicates that bulls are selling rallies.
Daily chart of SOL/USDT Source: TradingView
Todays bears pulled the price below the 20-day EMA. The SOL/USDT pair could drop to the $50 SMA ($108). This level will likely act as a strong support.
The bulls will attempt to push the price higher than the downtrend line if the price recovers. The pair could reach $170, then $200 if they are able to pull it off.
However, panic selling could occur if the 50-day SMA fails, and the price of the pair could drop to $98.26, which is the 78.6% Fibonacci level of retracement.
Polkadot (DOT) recovered from $25.50 that was stalled at $33.60. This indicates that bears are buying at higher levels. The bears are trying to lower the price below $28.60, the breakout level. A retest of $25.50 would be possible if they succeed.
Daily chart of DOT/USDT Source: TradingView
A bearish head-and-shoulders pattern will be completed by a break and close below $25.50. The DOT/USDT pairing could then begin its decline towards the 100-day SMA ($21.87), and then the pattern target of $12.23.
Contrary to popular belief, bulls will attempt to resume their up-move if the price bounces off the neckline or current level. If the price breaks and closes above $33.60, it could be possible to retest $38.77.
Related: Bitcoin price hits $45K; TWTR stock prices rise 3.8% after BTC tipping is announced by Twitter
Dogecoin (DOGE), which was pushed above $0.21 by the bulls on Sept. 22, failed to attract more buyers at higher levels. Todays price is below $0.21 after forming an inside day candlestick pattern on September 23.
Daily chart of DOGE/USDT Source: TradingView
The downsloping 20 day EMA ($0.23), and the RSI close to 36 indicate that sellers have the upper hand. The DOGE/USDT pair may continue to fall below $0.19 support if bears fail to move the price lower than $0.19.
The bulls will defend this level, which has held on three occasions before. However, bears who lower the price to $0.15 may increase selling and push the pair towards $0.10.
Avalanche (AVAX), rebounded from the 20-day EMA ($60.15), on Sept. 21. It then rose to a new record high on September 23. The resistance line at the ascending channel was not able to push the price higher by the bulls, which could have led to profit-booking from short-term traders.
Daily chart of AVAX/USDT Source: TradingView
Todays AVAX/USDT price pair fell and could stop at the channel support line. This support is likely to rebound strongly and signal that traders are still accumulating on dips. This could lead to the pair rising to $94.
A break or close below the channel is a sign that bulls are losing their grip. The pair could fall to $48 if the bears push the price below the 20 day EMA and then to the 50 day SMA ($43.06).
The bulls successfully defended a retest of Terra protocols breakout level in Terra protocol’s LUNA token on September 21. The positive sentiment suggested that traders saw the dips as an opportunity to buy.
Daily chart of LUNA/USDT Source: TradingView
The price climbed above the 20-day EMA ($33.06), on Sept. 22, and then followed it up with another move on Sept. 23. Despite the fact that the 20-day EMA is starting to rise, the RSI has been showing a negative divergence. This indicates that bullish momentum might be weakening.
The LUNA/USDT price could drop back to $22.40 if bears pull the price below its 20-day EMA. This is a crucial level to monitor because if it breaks, selling could intensify and drop the pair to $18.
The upside is that bulls could drive the price higher than $40 and the pair could reach the all-time high of $45.01. The resumption or acceleration of the uptrend could be signaled by a breakout and close above the level.
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.