Bitcoin’s (BTC) eight-week winning streak is likely to end as the price is down nearly 4% this week. This pullback is likely due to profit-booking by traders, however, it does not change the short-term uptrend. The correction should help reduce the potential froth that may have been accumulating.
The decision by the Federal Reserve to pause rate hikes and possibly reduce rates in 2024 is likely to further strengthen demand for crypto products. After the initial shakeout, strong hands may re-enter the crypto market, as the macro environment remains bullish for risk-assets.
It is normal for traders to take profits after a sharp rally and shift their focus to other coins. As Bitcoin takes a breather, traders may look to other altcoins. Let’s examine the charts of the top-five cryptocurrencies that could be attractive in the short-term.
Bitcoin price analysis
The price of Bitcoin is stuck between the 20-day exponential moving average ($41,370) and the downtrend line. This could lead to a substantial breakout in the coming days.
If the price dips below the 20-day EMA, the bears could try to push the BTC/USDT pair to the strong support at $37,980. This level is expected to be strongly defended by the bulls. If the price rebounds off $37,980, the bears may be able to push the price back down towards the 20-day EMA and the downtrend line.
On the other hand, if the price rises and breaks above the downtrend line, it could indicate that the bulls are gaining control. The pair could then test the overhead resistance at $44,700. If the resistance is broken, there are chances of a rally to $48,000.
The moving averages on the 4-hour chart have turned down, and the relative strength index (RSI) is trading in the negative territory, suggesting that the bears have a slight advantage in the short term. The bears must break the $40,000 support to drive the price down to $37,980.
If the price breaks above the downtrend line, it could suggest that the bulls have taken over. The pair could then rise to $43,500 and potentially to $44,700. This level may be the battleground between the bulls and the bears.
Cosmos price analysis
Cosmos (ATOM) has been in an uptrend for several days. Buyers purchased the dip to the 20-day EMA ($10.52) on Dec. 16, which indicates solid demand for the difference between web 1.0 2.0 and 3.0.
The bulls are attempting to push the price above the immediate resistance of $12.50, but the bears are not relenting. Nevertheless, the upsloping moving averages and the RSI in the positive area suggest that the path of least resistance is to the upside.
If buyers can drive the price above $12.50, the ATOM/USDT pair may rally to $13 and later to $15. If the bears want to prevent the up-move, they will have to drag the pair back below the 20-day EMA. The pair could then plunge to the 50-day SMA ($9.40).
The 4-hour chart shows that the bears are offering a stiff resistance at $12, but a positive sign is that the bulls have not allowed the price to dip below the 50-SMA. The rising moving averages and the RSI near the midpoint give a slight edge to the bulls.
A break above $12 will complete an inverse head-and-shoulders pattern. This bullish setup has a target objective of $13.31. On the contrary, if the price turns down and breaks below the 50-SMA, it will clear the path for a drop to $9.50.
Filecoin price analysis
Filecoin (FIL) dropped from $5.67 on Nov. 13 but has been bought back up to that level. This indicates that lower prices are being purchased.
The FIL/USDT pair is attempting to form a cup and handle pattern, which will be confirmed on a break and close above $5.67. If this happens, the pair will signal the start of a new uptrend. The reversal setup has a potential target of $8.41.
However, the bears may not give up easily. They could put up a strong resistance at $6.50 and again at $7.40. This bullish outlook could be invalidated in the near term if the price turns down and drops below the 50-day SMA ($4.61).
The bulls managed to push the price above the overhead resistance of $5.67 but were unable to hold the higher levels. Taking advantage of this, sellers are trying to pull the price back down and keep it below $5.67. If they are successful, the pair could drop to the 20-EMA. This remains an important support to watch out for.
If the price bounces off the 20-EMA, it will improve the chances of a retest of the overhead resistance at $6.20. A break above this resistance will signal the start of the next leg of the uptrend. On the downside, a break below the 20-EMA could lead to a fall to $4.40.
MultiversX price analysis
MultiversX (EGLD) dropped from the overhead resistance of $70 on Dec. 12 and arrived at the 20-day EMA ($55) on Dec. 16.
The recovery from the 20-day EMA suggests that the sentiment is still bullish, and investors are buying on dips. The bulls will endeavour to push the price to $70, which is still the essential resistance to watch out for in the near term. If buyers prevail over this obstacle, the EGLD/USDT pair could pick up momentum and surge to $90 and then to $100.
In the meantime, sellers are likely to have other plans. They will try to sell the rallies and pull the price back below the 20-day EMA. If they are successful in doing that, it will signal the start of a deeper correction to the 50-day SMA ($46).
The pair has taken support near $57 twice recently, making this the pivotal level to keep an eye on in the near term. A break and close below this level could open the doors for a fall to $48.
Conversely, if the price turns up from the current level or the strong support at $57 and rises above $64, it will suggest advantage to the bulls. This increases the likelihood of a rally to $70, which is likely to witness a hard-fought battle between the bulls and the bears.
Algorand price analysis
Buyers are having difficulty pushing Algorand (ALGO) above the resistance at $0.22, but the good news is that they have not given much ground. This indicates that the bulls are expecting another rise.
Both moving averages are rising, and the RSI is in the positive territory, suggesting that the bulls remain in control. Traders are likely to buy the dip to the 20-day EMA ($0.18). If the price bounces back from the 20-day EMA, the bulls will once again attempt to break the $0.22 barrier.
If successful, the ALGO/USDT pair could surge to $0.24 and then to $0.28. This bullish outlook will be invalidated in the near term if the pair drops and closes below the 20-day EMA. This would signal the start of a deeper correction to the 50-day SMA ($0.14).
The pair has been trading in a range between $0.18 and $0.22 for some time. The 20-EMA has started to turn down, and the RSI has slipped into the negative zone, increasing the probability of a drop to $0.18.
Buyers are expected to defend the $0.18 level strongly since a break below it would complete a triple-top pattern. This bearish setup has a target objective of $0.14.
If the price rebounds strongly from $0.18, it will indicate strong buying on dips. The pair could then rise to the 20-EMA and then to $0.22. A break and close above $0.22 would indicate the start of the next leg of the uptrend.
Subscribe to our email newsletter to get the latest posts delivered right to your email.