Bitcoin’s 8-week win streak is in danger, but ATOM, FIL, EGLD, and ALGO don’t care
2023.12.17 11:52
Bitcoin’s (BTC) eight-week winning streak is likely to end as the price is down nearly 4% this week. The recent weakness indicates profit-booking by traders but it does not change the short-term uptrend. The pullback will also help reduce the froth that may have been building.
After the initial shakeout, strong hands are likely to re-enter the crypto market as the macro environment remains bullish for risk-assets. The decision by the Federal Reserve to pause rate hikes and possibly reduce rates in 2024 could further boost demand for crypto products.
Crypto market data daily view. Source: Coin360
However, nothing goes up in a straight line. After sharp rallies, traders generally book profits and shift their focus to other coins. As Bitcoin takes a breather, traders’ are likely to turn their attention to select altcoins.
What are the coins that may attract buyers in the short term? Let’s look at the charts of the top-five cryptocurrencies that are showing promise.
Bitcoin price analysis
Bitcoin is getting squeezed between the 20-day exponential moving average ($41,370) and the downtrend line. This sets the stage for a sharp breakout within the next few days.
BTC/USDT daily chart. Source: TradingView
If the price dives below the 20-day EMA, the bears will sense an opportunity and try to tug the BTC/USDT pair to the strong support at $37,980. The bulls are expected to fiercely defend this level. If the price rebounds off $37,980, it is likely to face selling at the 20-day EMA and again at the downtrend line.
Instead, if the price turns up and breaks above the downtrend line, it will suggest that the bulls are asserting their dominance. The pair could then retest the overhead resistance at $44,700. If this level is scaled, the prospects of a rally to $48,000 improve.
BTC/USDT 4-hour chart. Source: TradingView
The moving averages on the 4-hour chart have turned down, and the relative strength index (RSI) is trading in the negative territory, indicating that the bears have a slight edge in the near term. The bears will have to break the $40,000 support to accelerate selling and sink the pair to $37,980.
On the upside, a break above the downtrend line will suggest that the bulls have absorbed the selling. The pair may first rise to $43,500 and thereafter rally to $44,700. This level may witness a tough battle between the bulls and the bears.
Cosmos price analysis
Cosmos (ATOM) has been in an uptrend for several days. The bulls purchased the dip to the 20-day EMA ($10.52) on Dec. 16, indicating solid demand at lower levels.
ATOM/USDT daily chart. Source: TradingView
The bulls are trying to propel the price above the immediate resistance of $12.50, but the bears are not relenting. However, the upsloping moving averages and the RSI in the positive area suggest that the path of least resistance is to the upside.
If buyers drive the price above $12.50, the ATOM/USDT pair may rally to $13 and later to $15. If 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).
ATOM/USDT 4-hour chart. Source: TradingView
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) turned down from $5.67 on Nov. 13 but has reached the level again. This shows that lower levels are being bought.
FIL/USDT daily chart. Source: TradingView
The FIL/USDT pair is trying to form a cup and handle formation, which will complete on a break and close above $5.67. If that happens, the pair will signal the start of a new up-move. The pattern target of the reversal setup is $8.41.
However, the bears are unlikely to give up easily. They will pose a strong challenge at $6.50 and again at $7.40. This bullish view will be invalidated in the near term if the price turns down and plummets below the 50-day SMA ($4.61).
FIL/USDT 4-hour chart. Source: TradingView
The bulls propelled the price above the overhead resistance of $5.67 but could not sustain the higher levels. Taking advantage of the situation, sellers are trying to pull and maintain the price below $5.67. If they succeed, the pair may drop to the 20-EMA. This remains an important support to keep an eye on.
If the price rebounds off the 20-EMA, it will improve the prospects 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 may open the doors for a fall to $4.40.
Related: Bitcoin fees hit 20-month high as miner revenues match $69K BTC price
MultiversX price analysis
MultiversX (EGLD) turned down from the overhead resistance of $70 on Dec. 12 and reached the 20-day EMA ($55) on Dec. 16.
EGLD/USDT daily chart. Source: TradingView
The rebound off the 20-day EMA indicates that the sentiment remains bullish, and traders are buying on dips. The bulls will try to push the price to $70, which remains the crucial resistance to watch out for in the near term. If buyers overcome this obstacle, the EGLD/USDT pair could pick up momentum and rally to $90 and thereafter to $100.
Meanwhile, sellers are likely to have other plans. They will try to sell the rallies and yank the price back below the 20-day EMA. If they manage to do that, it will signal the start of a deeper correction to the 50-day SMA ($46).
EGLD/USDT 4-hour chart. Source: TradingView
The pair has taken support near $57 twice recently, making this the crucial level to watch out for in the near term. A break and close below this level could open the doors for a fall to $48.
Contrarily, 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. That increases the possibility of a rally to $70, which is likely to witness a tough battle between the bulls and the bears.
Algorand price analysis
Buyers are finding it difficult to propel Algorand (ALGO) above the overhead resistance of $0.22, but a positive sign is that they have not given up much ground. This shows that the bulls anticipate another leg higher.
ALGO/USDT daily chart. Source: TradingView
Both moving averages are sloping up, and the RSI is in the positive territory, indicating that bulls remain in command. Buyers are expected to purchase the dip to the 20-day EMA ($0.18). If the price rebounds off the 20-day EMA, the bulls will again try to overcome the barrier at $0.22.
If they do that, the ALGO/USDT pair could surge to $0.24 and then to $0.28. This positive view will invalidate in the near term if the pair slides and closes below the 20-day EMA. That will signal the start of a deeper correction to the 50-day SMA ($0.14).
ALGO/USDT 4-hour chart. Source: TradingView
The pair has been range-bound 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 likelihood of a fall to $0.18.
Buyers are expected to protect the $0.18 level with vigor because a break below it will complete a triple-top pattern. This bearish setup has a target objective of $0.14.
If the price rebounds off $0.18 with force, it will indicate aggressive buying on dips. The pair could then rise to the 20-EMA and thereafter to $0.22. A break and close above $0.22 suggests the start of the next leg of the up-move.
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.
