The cryptocurrency markets have made a comeback in recent days. That brought the total crypto market capitalization to $995 billion on Jan. 14, according to data from CoinMarketCap. Bitcoin (BTC) led the rally from the front and shot up above $21,000 on Jan. 14.
After the strong rally, the big question is whether the rally is a dead cat bounce that is a selling opportunity, or is it the start of a new uptrend. It is difficult to predict with certainty if a macro bottom has been hit, but the charts suggest that a bottoming process has begun.
Independent market analyst HornHairs highlighted that the bear market from 2017 to 2018 lasted 364 days and from 2021 to the current market low, the duration is again 364 days. Another interesting similarity is that the bull market from 2015 to 2017 and the bull phase from 2018 to 2021 lasted 1064 days. If history repeats itself, then Bitcoin can make the next top in about 1,000 days.
Bitcoin’s short-term price action has been exciting for bulls, but are there any altcoins showing similar strength in the near term?
Let’s study the graphs to find out.
USDT/BTC
Bitcoin soared to $21,258 on Jan. 13 and that pushed the RSI above 89, indicating that the rally has overheated any time soon. The bears are expected to mount a strong defense at $21,500.
Sometimes when a trend reversal occurs, the RSI can stay in overbought territory for a long time. If the BTC/USDT pair does not give up much ground from the current level, it will suggest that traders are in no rush to book profits as they anticipate another leg higher.
If buyers push the price above $21,500, the pair could rally to $22,800. This level can once again act as a major obstacle.
On the way down, the bears will have to drag the price below the psychological $20,000 level to dent the bullish momentum. Then the pair could drop to the breakout level of $18,388.
The 4-hour chart shows that the bears are protecting the $21,250 level but a positive sign is that the bulls have not allowed the price to fall below $20,000. Buyers can try again to clear the overhead hurdle at $21,258 and resume the uptrend.
Conversely, if the price turns back below $21,250, it may tempt short-term traders to book profits. That could sink the pair below the 20 day EMA. The bears may try to capitalize on this situation and push the pair to $18,388.
USDT/USDT
Litecoin (LTC) broke above the overhead resistance at $85 on Jan. 12, signaling the start of a new uptrend. There is no major hurdle until the price reaches $107.
On the downside, the bulls will try to fiercely defend the area between $85 and the 20-day EMA ($79). If the price breaks out of this zone again, the LTC/USDT pair could continue its uptrend and reach as high as $107.
The rising moving averages signal an advantage for the bulls, but the RSI above 77 suggests a bit of a pullback or consolidation is likely.
If the bears want to gain an advantage, they will have to push the price below the breakout level of $75. That could lead to a collapse to $61.
The 4 hour chart shows that the pair is in an uptrend and the bulls are fiercely protecting the 20 day EMA. If the buyers push the price above $92, the pair could pick up momentum and rally towards the psychological $100 level.
Conversely, if the price turns down and dips below the 20 day EMA, it will suggest that short-term traders may be booking profits. That could take the price to the 50-SMA. This is an important level for the bulls to defend because a break below it could increase the risk of a drop to $80 and then $75.
USDT/OKB
While several cryptocurrencies are trying to bottom out, OKB (OKB) has started a new uptrend. It is generally a good strategy to buy the dips in an uptrend by keeping a suitable stop loss.
The rising moving averages and the RSI in the overbought territory indicate that the bulls are in command, but a short-term consolidation or correction cannot be ruled out. The OKB/USDT pair could drop to the 20-day EMA ($27.64), which is likely to act as strong support.
If the price bounces off this level, the pair could touch the strong upper barrier at $34.18. Crossing this level may be a difficult task, but if the bulls manage to pull it off, the pair could skyrocket to $42.
If the bears want to stop the move higher, they will have to pull the price below the 20 day EMA. If successful, the pair could plummet to the 50-day SMA ($24.05).
The 4-hour chart shows that the uptrend was met with strong selling near $33 and the pair could correct to the 20-day EMA. If the price bounces off this support, it will suggest that the bulls are buying every minor dip. That could bring the price down to $34.18.
Conversely, if the price breaks below the 20 EMA, the correction could deepen to the 50 EMA. If the price bounces off this level, the bulls will try again to resume the up move, but may face resistance. of $31 and again close to $33.
Related: Bitcoin Fails To Convince Fund Is In With $12K ‘Still Likely’
Bit/USDT
BitDAO (BIT) rose sharply from $0.26 on Dec. 27 to $0.53 on Jan. 14, indicating strong bullish momentum. Furthermore, the shallow retracement on January 15th suggests that traders are not exiting their positions in a hurry, as they anticipate the bullish move to continue.
If the bulls push the price above the overhead resistance at $0.54, the BIT/USDT pair could resume its up move. The next upside resistance is at $0.68. The bears can present a strong challenge at this level because a break and close above it could open the doors for a possible rally to $0.80.
On the downside, the first support is at $0.46 and then the 20-day EMA ($0.42). A strong bounce off any of the supports will suggest that traders are buying on the decline. That could result in a retest of $0.54. The bears can take over if the price sinks below the 20 day EMA.
The 4-hour chart shows that the pair is facing resistance near $0.54, but the bulls are likely to defend the dip to the 20-day EMA. A strong bounce from this level will suggest that the bulls are buying shallow dips. That could improve the prospects for a break above $0.54.
Alternatively, if the price turns down and falls below the 20 day EMA, several short-term traders can book profits. That could take the pair to the 50-SMA. If this level is broken as well, the pair could fall to $0.41.
FTM/USDT
Fantom (FTM) broke above the downtrend line on January 9, indicating a possible trend reversal. The breakout was followed by a sharp rally that pushed the RSI to deeply overbought levels.
Vertical rallies are unsustainable, so a pullback was to be expected. The FTM/USDT pair could drop to the 38.2% Fibonacci retracement level of $0.30 and then to the 50% retracement level of $0.28.
If the price rises from this zone, it will suggest a shift in sentiment from selling on the rallies to buying on the dips. Then, the bulls will try to resume the rally and push the pair above $0.36. If they do that, the pair could rally to $0.42.
Conversely, a break and close below $0.28 could send the pair to the 61.8% retracement level of $0.26. A deeper drop could break the bullish momentum and increase the possibility of a range formation.
Both moving averages are sloping up and the RSI is in the positive territory, indicating an advantage for buyers. The pair could slide towards the 20 day EMA, which is likely to act as strong support. If the price bounces off this level, the bulls will try to resume the bullish move.
Conversely, if the price breaks below the 20 day EMA, it will suggest that traders are aggressively profiting after the recent rally. The pair could then extend its correction to the 50-SMA.
The views, thoughts and opinions expressed here 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 do their own research when making a decision.
