THETA, LIDO, KLAY and EGLD flash bullish signs as Bitcoin regains $23K
Cryptocurrency markets and the US stock markets witnessed profit booking this week as the macroeconomic data hinted at continued interest rate hikes by the Federal Reserve. Bitcoin (BTC) is down more than 4% and the S&P 500 fell 2.7% to record its worst week of the year.
The CME FedWatch Tool shows a 73% probability of a 25-basis-point rate hike from the Fed at its March meeting, but after the warmer-than-expected inflation readings in two weeks, the likelihood of a 50-basis-point rate hike has begun to slow. gain traction.
During periods of uncertainty, some coins go into a deeper correction, while a few buck the trend and continue to outperform the markets. Therefore, it becomes important to choose the right coins to trade.
A few coins that have witnessed a shallow correction or have jumped sharply from the support have been selected in this list. Let’s look at their charts and determine the levels you should watch out for.
BTC/USDT
Bitcoin plunged below the 20-day exponential moving average ($23,391) on February 24, but the bears could not build on this advantage and sustain the price below the strong support of $22,800.
The price bounced off $22,800 on February 25 and the bulls are trying to push the price above the 20-day EMA. If they pull it off, it would indicate that the BTC/USDT pair could consolidate between $25,250 and $22,800 for a few days.
The flattening 20-day EMA and the relative strength index (RSI) near the midpoint also suggest a range-bound action in the near term.
Alternatively, if the price falls below $22,700, selling could intensify and the pair could plunge to the next strong support at $21,480.
The 20-EMA has turned down on the 4-hour chart and the RSI is in negative territory. This indicates an advantage for the bears. Sellers will try to protect the 20-EMA and if the price breaks down from this level, the likelihood of a break below $22,800 increases. If that happens, selling may intensify and the pair may slip to $21,480.
On the contrary, if the price breaks above the 20-EMA, it will indicate that bulls are buying on the dip. That could push the pair to the 50-simple moving average and keep the price stuck in the range for a while longer.
LDO/USDT
Lido DAO (LDO) did not stay below the 20-day EMA ($2.75) during the recent correction, which is a positive sign. Another bullish sign is the formation of pennant near the local highs.
The bulls will try to drive the price above the resistance line of the pennant. If they succeed, the LDO/USDT pair can start the next stage of the up move. The pair may first rise to $3.90 and then try a rally to $4.24.
Conversely, if the price breaks down from the resistance line, it would indicate that bears are selling on a rally. This can keep the price in the pennant for a while longer. The bears need to lower the price below the pennant if they want to signal a short-term trend reversal.
The strong bounce from the support line to the pennant indicates aggressive buying on dips. Buyers must overcome the obstacle at the resistance line to regain control. If they do, the pair could resume its uptrend.
However, the Bears will likely have other plans as they will try to protect the line of scrimmage. If the price declines from this level, the equilibrium state may continue for some time.
A break below the pennant can attract profit booking by short-term traders. It can pull the price to $2.20 and later to $2.
EGLD/USDT
MultiversX (EGLD) rejected the resistance line, but an encouraging sign is that the bulls are trying to defend the 20-day EMA ($47).
Both moving averages are sloping up and the RSI is above 54, indicating that buyers have a slight advantage. The bulls will try to push the price towards the resistance line where they will again likely face strong resistance from the bears.
This bullish view may be invalidated in the short term if the price declines and plunges below the 20-day EMA. It will indicate selling by the bears on every minor rally. The EGLD/USDT pair could then fall to the 50-day SMA ($44) and later to $40.
The 4-hour chart shows that the price is falling within a descending channel pattern. Buyers bought at lower levels and have pushed the price to the resistance line of the channel. If this resistance gives way, the pair could rise to the 50-SMA and then attempt a retest of the strong barrier at $54.
If, on the other hand, the price goes down from the resistance line, it will indicate that the bears have not given up. It can result in a drop towards the support line of the channel.
Related: How does the US Dollar Index (DXY) affect cryptocurrencies? See Macro Markets
THETA/USDT
The bulls are trying to arrest Theta Networks ( THETA ) pullback at the 20-day EMA ($1.15). Both moving averages are sloping up and the RSI is in the positive territory, indicating favor for the bulls.
If buyers push the price above the downtrend line, the THETA/USDT pair could climb to the $1.34 overhead resistance. This is formidable resistance and a break above it could open the gates for a possible rally to $1.70.
Instead, if the price goes down and plunges below the 20-day EMA, it would indicate that the short-term bulls may rush to the exit. It could initiate a deeper correction to the 50-day SMA ($1.05) and then to the psychological support at $1.
The 4-hour chart shows the formation of a symmetrical triangle pattern. Both moving averages have flattened and the RSI is hovering near the center, indicating a balance between supply and demand.
A break below the triangle could tilt the short-term advantage in favor of the bears. The pair may first fall to $1.12 and then to $1.
If bulls want to prevent the decline, they need to quickly drive the price above the triangle. It can start a journey to $1.27 and later to $1.30.
KLAY/USDT
Klaytn (KLAY) is trying to break out of a base pattern. The price bounced back from the 20-day EMA ($0.26) on February 25, indicating solid buying on the downside.
The bulls will try to pierce the overhead resistance at $0.34. If they do, the KLAY/USDT pair could gain momentum and rise to the $0.50 psychological resistance. Such a move would signal a potential trend change.
If the price goes down from $0.34, it will indicate that bears are protecting the level hard. That could again pull the price down to the 20-day EMA. A break below this level may indicate that the pair may spend some more time in the base pattern.
The bulls stopped the pullback near the 61.8% Fibonacci retracement of $0.26 and started a recovery. There is a minor resistance at $0.32, but if this level is crossed, the pair could attempt a rally to $0.34 and then to $0.37.
On the other hand, if the price breaks down from the overhead resistance, it would indicate that bears are selling on the rally. That could raise the prospect of a break below $0.26. If that happens, the pair could slide to $0.22.
The views, thoughts and opinions expressed herein are those of the authors alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
