Altcoins had a relief rally on Tuesday with most of them in the green.
NEW DELHI (CoinChapter.com) — Last week’s crypto market crash sent Bitcoin (BTC), Ethereum (ETH), and other cryptocurrencies spiraling down. The crash wiped nearly $1 trillion from the global crypto market cap.
However, Tuesday saw the markets recovering a bit, with Bitcoin up 3% and Ether up 4% on the day at the time of writing. Other altcoins followed suit, with BNB up 5.4% in the last 24 hours.
However, analysts believe the market might not have reached the bottom. As such, further downside movement might be possible.
Terra’s LUNA token tested support at $62.1 on Monday before rebounding. Jan 25’s long wick indicates that bulls are aggressively buying the dip. However, failure to move above immediate support at $70.2 indicates bears are selling the rally.
Moreover, suppose the Terra token moves above its immediate resistance. In that case, LUNA’s next resistance level is at $76.3, near a confluence of the 50-day Moving Average line, descending channel resistance, and the 26-day Exponential Moving Average trendline.
Furthermore, the token has support at $62, a price level that LUNA has tested several times since Jan 17. Further downtrend could see prices move down to $56.
The relative strength index is neutral, clocking 42.16 in the daily time frame, with the RSI trendline moving downwards, indicating bears have the upper hand. As a result, LUNA could fall to the descending channel support trendline, pushing prices down to $50.
Solana prices lost over 32% of their value in the previous week, with more than 27% of the downtrend between Jan 21-Jan 22. The token has been moving in a descending channel since Nov 10. In addition, SOL’s 26-day EMA and 200-day MA lines have formed a death cross.
When an asset’s short-term moving average crosses below its long-term moving average line, it forms a bearish chart pattern called the death cross. On Jan 25, SOL reached $100, jumping 13% before prices pared. The Solana token has immediate resistance near $102.
SOL’s failure to move above its immediate resistance indicates that buying sentiment decreases as prices rally upwards. Furthermore, bears are looking to push prices down to the descending channel support.
A rally upwards would push the SOLUSD pair to $116. However, the death cross combined with an oversold relative strength index could likely push SOL below its immediate support at $85. Solana’s RSI is in the oversold regions, with a value of 27.12 on the daily charts.
In the case of a marketwide sell-off, SOL prices could fall to $74.7. At the time of writing, SOL was trading at $95.10, up 3.17% on the day.
Binance’s native token BNB fell below the descending channel support on Jan 21 during the crypto market crash. Moreover, a subsequent sell-off on Jan 22 pushed BNB further downwards. Since then, BNB has been moving horizontally.
BNB has immediate support at $356, above which BNB prices are currently consolidating. Although bulls attempted a rally on Jan 23, BNB failed to move upwards.
A key support zone for BNB is between $339 to $327. BNB has not fallen below the support zone since Aug 5. On the other hand, immediate resistance for BNB is at $390. If BNB bulls managed to start a long-term rally, Binance Coin could move to $404.
Additionally, BNB could also target $417.5 riding on the back of a sustained bull run.
Meanwhile, the relative strength index has bounced back from the oversold region on Jan 23. Friday’s crash caused RSI to plummet into the oversold regions, often an indicator of a trend reversal.
At the time of writing, BNB was trading at $381.7, up 2.64% on the day.
Cardano’s ADA token fell 20.25% in the week beginning Jan 17. Moreover, the Cardano token broke below the support at $1. Long wicks in the bearish candles indicate that bulls are actively buying ADA dips, thus defending the $1 support levels.
However, though ADA rebounded off support at $1, the uptrend failed to breach immediate resistance, indicating bears are profit-booking on minor relief rallies. ADA’s 50-day MA line acts as resistance $1.3, while the Cardano token’s RSI is currently neutral with a value of 38.75.
A downtrend could pull ADA prices down to $0.88 before Cardano recovers. At the time of writing, ADA was trading at $1.04, down 2.62% on the day.
Meme token Dogecoin broke below the key support level at $0.13 on Jan 22. However, the long wick on the Jan 22’s candle indicates bulls are buying the meme coin at lower levels. Although DOGE tried to start a rally on Sunday, prices reaching higher levels attracted sell-offs, starting a pullback.
On Jan 25, DOGE price jumped to $0.15 from the day’s low of $0.13 before prices pared. However, the DOGE’s RSI has formed a bullish divergence from its price action. In detail, an RSI bullish divergence occurs when an asset’s price moves in the opposite direction of its technical indicator, such as RSI.
Dogecoin’s relative strength index is currently neutral, with a value of 40.28 on the daily charts. Meanwhile, the DOGE price has immediate resistance at $0.151. In addition, Dogecoin’s 50-day MA line forms resistance for the meme token near $0.167.
On the other hand, DOGE has support near the $0.128 price level. If bears pull prices down, DOGE prices could fall to $0.11 before recovering.
At the time of writing, DOGE was trading at $0.141, up 2.98% on the day.
A Delhi-based Markets writer, I did my bachelor's in engineering with major in electronics and communications. I first heard of bitcoin while writing an article about blockchain technology a few years back, and have been following it ever since. Bitcoin may well be current big thing happening in the finance industry, and it feels like the right time to join the crypto bandwagon.