BTC, ETH, BNB, XRP, ADA, DOGE, MATIC, DOT, LTC, AVAX
On February 9, United States Securities and Exchange Commission (SEC) Chairman Gary Gensler explained why the regulator had cracked down on Kraken’s cryptocurrency exchange, forcing it to halt its crypto-staking program for US customers. This news may have rattled crypto investors and they sold aggressively. Bitcoin (BTC) crashed around 5% on February 9 and several altcoins also followed suit.
The recent round of selling has left traders wondering if the bear market has resumed or if the decline should be interpreted as a buying opportunity. This question may be troubling for investors, but for now the correction appears to be a normal correction phase where cryptocurrencies give back some of the gains made in January. However, it would be wise to wait until the correction ends and a bottom is confirmed before considering new purchases.
Former BitMEX CEO Arthur Hayes said in a February 7 blog post that Bitcoin may continue its bull run in the first half of the year, but may face challenges in the latter half. Along with Bitcoin and Ether, Hayes is also bullish on altcoins, but he said the trick is getting the timing right.
What are the key support levels to watch for Bitcoin and altcoins in the near term? Let’s study the charts of the top 10 cryptocurrencies to find out.
BTC/USDT
The $22,800 support was cracked on February 9 and Bitcoin plunged to the strong support near $21,480. Lack of a strong bounce from this level suggests that the correction could deepen further.
Below $21,480, selling may accelerate and the BTC/USDT pair may fall to the moving averages. The Relative Strength Index (RSI) has slipped into negative territory, indicating that bears are trying to gain the upper hand in the short term.
The moving averages have completed a golden cross, but the bulls need to turn the 200-day simple moving average ($19,722) into support if they want to stay in the game.
A strong pullback outside the zone between $21,480 and the 200-day SMA would suggest that bulls are trying to form a higher low. The pair may then gradually move back towards $24,255. The bulls need to overcome the resistance at $25,211 to suggest that the downtrend is over.
ETH/USDT
The bears did not allow Ether (ETH) to hold above the $1,680 level, which may have tempted short-term bulls to book profits.
The moving averages have completed a golden cross, indicating a potential trend change, but the bears are unlikely to give up without a fight. The sellers will try to pull the price below the moving averages and catch the aggressive bulls. If they manage to do that, selling could intensify and a collapse to $1,200 is possible.
Instead, if the price moves up from the moving averages, it would indicate that bulls are trying to turn the 200-day SMA ($1,442) into support. The bulls will then make another attempt to push the price above $1680 and gain control. The ETH/USDT pair could then start its northward march towards $2000.
BNB/USDT
BNB (BNB) plunged back below the breakout level of $318 on February 9, showing aggressive selling at higher levels. This clears the way for a possible dump to the 200-day SMA ($287).
The bulls will likely defend the moving averages vigorously. If the price pulls back from this support with force, the BNB/USDT pair could form an inverse head and shoulders pattern, which will be completed by a break and close above the neck. This bullish reversal setup has a target of $440.
On the other hand, if the price breaks below the moving averages, selling may intensify and the pair may fall to $240.
XRP/USDT
After staying above the 200-day SMA ($0.39) for several days, XRP (XRP) broke below support on February 9. This suggests that bears are trying to take responsibility.
The 50-day SMA ($0.38) had acted as a strong support on January 18 and the bulls are again trying to protect the level. If the price bounces off the current level and rises above the 200-day SMA, it will suggest strong demand at lower levels. The buyers will then aim to overcome the barrier at $0.43 and start an up move towards $0.51.
Conversely, if the 50-day SMA gives way, it will signal that bears are back in the driver’s seat. The XRP/USDT pair could then fall to $0.33.
ADA/USDT
The 200-day SMA ($0.39) acted as a strong obstacle for Cardano (ADA). Although the bulls pushed the price above resistance on several occasions, they were unable to build on the strength.
The price reversed and fell below the $0.38 support on February 9. Sellers will try to pull the price to the 50-day SMA ($0.33), which is likely to act as a strong support. If the price rebounds off the 50-day SMA with strength, it would indicate that bulls are trying to form a higher low.
On the upside, buyers will need to overcome the zone between the 200-day SMA and $0.42 to suggest a potential trend change. That could increase the possibility of a rally above $0.44.
DOGE/USDT
Dogecoin (DOGE) dipped below the $0.09 support on February 9 and touched the 50-day SMA ($0.08). This decline has pulled the RSI into the negative territory, indicating that the momentum has shifted in favor of the bears.
The bulls must defend the zone between the moving averages with all their might, because if they fail, the DOGE/USDT pair could fall to the important support near $0.07. If the price pulls back from this level, the pair may consolidate between $0.07 and $0.10 for a few days.
If the price pulls back from the current level of strength, it will indicate that the bulls are looking to turn the 200-day SMA ($0.08) into support. If they do, the pair can start their journey back towards $0.10.
MATIC/USDT
Buyers pushed Polygon (MATIC) above the $1.30 overhead resistance on February 8 and 9, but could not sustain the breakout. This shows that bears sold the rise above $1.30.
A positive sign, however, is that the bulls have not given much ground to the bears. This suggests that shallow dips attract buyers. This improves the prospects for a rally above $1.30. If that happens, the MATIC/USDT pair could rise to $1.45 and then to $1.70.
Conversely, if the price again turns down from the overhead resistance, it would indicate that bears continue to guard the $1.30 level fiercely. The bears need to drop the price below $1.16 to make way for a retest of $1.05.
Related: Ethereum price risks 20% correction amid SEC crackdown on crypto stakes
LTC/USDT
Litecoin (LTC) declined from $102.50 on February 8. This shows that the inability to break above the resistance may have tempted short-term traders to book profits.
The bulls will try to stop the decline with immediate support at $88 while the bears will try to pull the LTC/USDT pair to the 50-day SMA ($84). A deeper decline would indicate that the momentum has weakened and it could delay the resumption of the uptrend.
If bulls want to resume the rally, they need to quickly push the price back above $98. It will signal a positive sentiment, indicating that traders are buying on dips. The bulls will then again attempt to overcome the barrier at $102.50 and start the next leg of the uptrend towards $115.
DOT/USDT
The bulls’ failure to drive Polkadot (DOT) above $7.25 may have attracted selling by short-term traders, pulling the price to the 200-day SMA ($6.33).
Buyers will try to stop the decline in the zone between the moving averages and turn this into a higher low. If they succeed, it will indicate that the DOT/USDT pair has started a bottom formation. A break and close above $7.25 could attract further buying and open the door for a possible rally to $10.
On the contrary, if the price dips below the 50-day SMA ($5.59), it would indicate that the bears are back in control.
AVAX/USDT
Avalanche (AVAX) turned from the overhead resistance at $22 and reached the 200-day SMA ($17.88). Buyers are expected to defend the zone between the moving averages.
If the price pulls back from the current level, the bulls will make one more attempt to push the price above $22. If they manage to do that, the AVAX/USDT pair is likely to gain momentum and increase to $30.
Another possibility is that the price retraces from the moving averages but fails to climb above $22. It may result in a consolidation for a few days. The bears must drop the price below the 50-day SMA to gain the upper hand.
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