After its sharp decline on Aug. 17, Bitcoin stayed within a narrow range over the weekend, indicating that bulls and bears have yet to decide on the next direction.
According to Glassnode’s weekly newsletter, “The Week On-Chain,” about 88% of Bitcoin (BTC) held by short-term holders (STHs), those owning Bitcoin for 155 days or less, has dropped into the red. Glassnode also warned that the STH cohort is “becoming more sensitive to price changes.”
In contrast, long-term holders have not panicked nor bought more during the current drop.
Traders will be keeping a close eye on Federal Reserve Chairman Jerome Powell’s speech at the annual Jackson Hole Economic Symposium on Aug. 25. If Powell does not create a negative shock, then this event could be bullish for risky assets. History shows that U.S. stocks usually increase in the week following Jackson Hole.
What are the important support and resistance levels to watch for in Bitcoin and altcoins? Let’s analyze the charts to find out.
S&P 500 Index price analysis
The S&P 500 Index (SPX) is advancing in an uptrend, which usually presents a buying opportunity. However, it is advisable to wait until the correction has ended before resuming purchases.
The price has reached the breakout level of 4,307, which is a key point to keep an eye on. The moving averages are close to a bearish crossover, and the relative strength index (RSI) is in negative territory, indicating that bears are trying to take control.
If the price rebounds from the current level, it is likely to be met with selling pressure at the moving averages. If the price turns down from the moving averages, the index has the potential to form a bearish head-and-shoulders pattern.
Conversely, if the price rallies above the moving averages, this could signal the end of the corrective phase.
U.S. Dollar Index price analysis
The U.S. Dollar Index (DXY) has managed to stay above the downtrend line, indicating that the bulls have been able to maintain buying pressure. If buyers are able to push the index above the downtrend line, it will suggest that the bears are losing their grip. The index could then resume its recovery and reach the stiff overhead resistance at 106, which might trigger strong selling by the bears.
The moving averages are the important support to watch out for on the downside. To signal a comeback, the bears will have to sink the price below the 50-day simple moving average (SMA) at 102. This could open the doors for a retest of the strong support near 101.
Bitcoin price analysis
The market for Bitcoin has been in a period of consolidation, with prices ranging from $24,800 to $31,000 over the last few weeks. Traders are taking advantage of this range by buying at support and selling near resistance. In between, the market may be unpredictable and volatile.
The moving averages have turned down and the RSI is in the oversold territory, indicating that bears are in control of the market. Sellers are attempting to push the price below $24,800, but the bulls are likely to resist.
Buyers may try to initiate a recovery at the support level, which could gain momentum if it rises above $26,833. The BTC/USDT pair may then move up to the 20-day exponential moving average (EMA) at $28,098, which suggests that the range-bound action is still in effect.
Ether price analysis
Ether’s (ETH) bounce is facing difficulty in surpassing $1,700, which implies that the bears have not given up and are selling on minor rallies.
A feeble bounce usually implies a lack of urgency among the bulls to buy. This increases the risk of a breakdown beneath the support. If the price turns down and falls below $1,626, it will suggest that the bears remain in command. The ETH/USDT pair may then retest the intraday low of $1,550 made on Aug. 17.
Conversely, if the price turns up from the current level and rises above $1,700, it will suggest the commencement of a stronger recovery. The first stop may be the 20-day EMA ($1,777), but if this level is crossed, the pair may reach the 50-day SMA ($1,852).
BNB price analysis
BNB (BNB) recently tumbled below the essential support of $220, which the bears have been able to defend since then, suggesting that they are trying to convert the $220 level into resistance.
The price fell below the immediate support of $212 on Aug. 21, signifying the continuation of the downtrend. The BNB/USDT pair could drop to the pattern target of $196 and possibly to the next major support at $183.
The bulls are running out of time. If they want to turn the tables, they need to push and maintain the price above $220. The pair could then ascend to the 20-day EMA ($230), which could act as a formidable barrier.
XRP price analysis
XRP (XRP) bounced off the strong support at $0.41 on Aug. 17 and reached the overhead resistance at $0.56 on Aug. 20, indicating that the Avalanche Crypto (AVAX) market sentiment remains negative.
Bears are trying to stop the relief rally near $0.56, and if the price turns down and breaks below $0.48, it will suggest that the XRP/USDT pair may swing between $0.41 and $0.56 for a few days.
The downsloping 20-day EMA ($0.59) and the RSI near the oversold zone signal that bears have the edge. The first sign of strength will be a break and close above the 20-day EMA, which could mean that the bearish pressure may be reducing.
Cardano price analysis
Cardano (ADA) has recovered from the important support level of $0.24 on Aug. 17, however the bullish rally is facing resistance near $0.28.
The downward sloping 20-day EMA ($0.28) and the RSI in the negative zone point to the fact that bears are in control. If the price falls below $0.26, it will indicate that the ADA/USDT pair may stay within the narrow range between $0.24 and $0.28 for a while longer.
Generally, a tight consolidation close to a robust support level is a bearish sign, and it may lead to a breakdown. If the $0.24 support is broken, the pair may plunge to $0.22 and then to $0.20. If buyers want to prevent the decline, they must quickly push the price above the moving averages.
Dogecoin price analysis
Bulls have maintained Dogecoin (DOGE) above the important support at $0.06 over the past few days, but they have not been able to initiate a strong bounce.
The insignificant bounce suggests negative sentiment where the bulls are not buying aggressively. This may have enabled the bears to take control, thus pushing the price to the strong support at $0.06.
In case the price dips below $0.06, the DOGE/USDT pair could crash towards the next strong support near $0.05. Conversely, if the price turns up from the current level, it will show that buyers are accumulating at lower levels. The pair may then ascend to the moving averages. A break above the 50-day SMA ($0.07) could begin a sustained recovery.
Solana price analysis
SOL/USDT bulls are facing a hurdle near the $22.30 resistance level, which suggests that the bears are attempting to transform this area into resistance. The bearish crossover of the moving averages and the negative reading on the RSI point to the advantage of the bears. The pair could see a dip towards the $20 support, and if this fails to hold, a deeper correction towards $18 and then $15.60 could be on the cards.
For the bulls to make a comeback, they will need to push the price above the moving averages. This will be a difficult task, but if they manage to do it, the SOL/USDT pair could rally to the resistance zone between $26 and $27.12.
Polkadot price analysis
Polkadot (DOT) has formed a Doji candlestick pattern on Aug. 19 and 20, showing that buying pressure is decreasing.
If the price continues to drop and breaks below $4.36, it suggests that bears are trying to take control. The DOT/USDT pair could then test the support at $4.22. If this level is breached, the selling could intensify and the pair could start the next bearish leg.
On the other hand, if the price rises and breaks above $4.56, it indicates that bulls are regaining ground. The pair could then rally to the 20-day EMA ($4.79), which is likely to act as a resistance.
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