The crypto market corrected itself on the news that the CFTC sued Binance and its CEO, Changpeng Zhao, but the technical charts reveal a silver lining.
News and events related to the banking crisis in the United States and Europe have caused a rotation of funds towards investments considered lower risk. According to the Financial Times, US money market funds saw an inflow of $286 billion in March.
Along with the money market funds, some of the money may have also leaked into the crypto industry. Increased demand could be one reason for Bitcoin’s (BTC) strong performance in March.
The big question on crypto investors’ minds is whether the rally will continue or whether it is time to book profits in Bitcoin.
Bitcoin hodlers seem confident in the long-term story and are not tempted to sell their holdings after the recent rally. According to Glassnode data, the percentage of Bitcoin supply that has been dormant since March 2021 has hit a new all-time high.
If the banking crisis is contained, it may lead to a short-term correction in Bitcoin and altcoins, but any further problems in the legacy banking system may continue to attract Bitcoin investment. Let’s study the charts to find out the critical support and resistance levels in Bitcoin and altcoins.
S&P 500 Index Price Analysis
The S&P 500 Index (SPX) is trading inside a falling widening wedge pattern. The bulls tried to push the price above the wedge on March 22, but the bears held their ground.
Buyers pushed the price above the 20-day exponential moving average (3,964) on March 27, but the long wick on the day’s candlestick shows that the bears are in no mood to budge. The sellers will try to sink the price below the 200 SMA (3.931). If they succeed, the index could drop to 3,800.
Conversely, if the bulls defend the moving averages, it will suggest demand at lower levels. Bullish momentum could pick up after the buyers push the price above the resistance line of the wedge. The index could then soar to 4,200.
US Dollar Index Price Analysis
Buyers pushed the US Dollar Index (DXY) above the 20-day exponential moving average (103) on March 15 but were unable to take advantage of the breakout. This shows that the bears are selling rallies.
The index could fall to the strong support at 100.82, where the bulls will try to stop the decline. If the price bounces off this level and rises above the 20-day EMA, it will suggest that the index can range between the 200-day SMA (106) and 100.82 for longer.
A break below the 100.82 level will be very negative as it completes a bearish head and shoulders (H&S) pattern. The index could then plummet to 95. On the upside, a break above the 200-day SMA could send the price to the 61.8% Fibonacci retracement level of 108.43.
Bitcoin Price Analysis
Bitcoin has failed to break above $29,000 in recent days, but the bulls continue to hold strong. They have not allowed the price to fall even to the breakout level of $25,250.
The rising 20-day EMA ($26,062) and the RSI in the positive territory indicate that the path of least resistance is to the upside.
If the bulls push the price above $29,000, the BTC/USDT pair can quickly rally to $32,500. This level may witness aggressive selling by the bears, but if buyers break through this barrier, the pair could skyrocket to $40,000.
This positive view could be invalidated in the short term if the price falls below $25,250. Emboldened bears will then try to sink the pair to the 200-day SMA ($20,219).
Ether Price Analysis
Ether (ETH) bounced off the 20-day EMA ($1,705) on March 25, but the bulls were unable to challenge the overhead resistance at $1,857. This shows that the bears are selling on relief rallies.
The bears will try to sink the price below the 20-day EMA and the horizontal support at $1,680 again. If they can pull it off, the ETH/USDT pair can drop to $1,600. This is an important level for the bulls to defend because if this support breaks, the pair can drop to the 200-day SMA ($1,435).
Alternatively, if the price bounces off the 20 day EMA, it will suggest that the bulls continue to buy minor dips. Then, the pair could rally to the stiff overhead resistance of $1,857. If this hurdle is crossed, the pair can rally to $2,000 and then $2,200.
BNB Price Analysis
BNB (BNB) bounced off the 20-day EMA ($317) on March 25, but the bulls were unable to clear the downtrend line, indicating that the bears are selling every minor rally.
The bears have pushed the price below the 20-day EMA. If they manage to hold the lower levels, the BNB/USDT pair could plummet to the 200-day SMA ($290). This is an important level to watch because if it gives way, the pair can plummet to $265.
The first sign of strength will be a breakout and close above the downtrend line. That will indicate aggressive buying at lower levels. Then the pair may attempt a rally to the $338 to $346 resistance zone.
XRP Price Analysis
The bulls flipped the moving averages to support and attempted to resume the rally in XRP (XRP). However, the higher levels are attracting aggressive selling as seen on the long wick of the March 27 candle.
The bears will once again try to push the XRP/USDT pair to the moving averages. If the price bounces off the 20-day EMA ($0.41), it will suggest that the buyers are accumulating at lower levels. The bulls can then make one more attempt to clear the upper zone. If that happens, the pair can rally to $0.65 and eventually $0.80.
On the other hand, if the price falls below the moving averages, it will suggest that the bears are back in control. Then the pair could fall to $0.36.
Cardano Price Analysis
Cardano (ADA) fell below the 200-day SMA ($0.36) and reached the 20-day EMA ($0.35) on March 25. The bulls attempted a rally on March 26, but the bounce lacked strength.
The bears will try to hold the price below the 20-day EMA. If they manage to do that, it will indicate that the recent rally above the 200-day SMA may have been a bull trap. The ADA/USDT pair can first slide to $0.32 and then to $0.30.
Conversely, if the price rises above the 200-day SMA, it will suggest demand at lower levels. Then the bulls will make one more attempt to push the price to the neckline of the inverse H&S pattern.
Related: Why has the price of Bitcoin gone down today?
Polygon Price Analysis
Polygon (MATIC)’s shallow bounce off the strong support of $1.05 on March 25 suggests a lack of aggressive buying by the bulls. The bears are trying to strengthen their position by pulling the price below $1.05.
If the bears hold the break, the MATIC/USDT pair can drop to the 200-day SMA ($0.97). This is an important level to watch because if it gives way, sentiment will turn negative and the pair could drop to $0.69.
If the bulls want to avoid this dip, they will have to quickly push the price above the 20-day EMA ($1.13). That will increase the probability of a rally towards the strong overhead resistance zone between $1.25 and $1.30.
Dogecoin Price Analysis
Dogecoin (DOGE) has been oscillating between the 200-day SMA ($0.08) and the horizontal support of $0.07 for the past few days.
The flat 20-day EMA ($0.07) and the RSI just below the midpoint do not give a clear advantage to either the bulls or the bears. This suggests that the DOGE/USDT pair may spend more time range bound. The longer it spends within the range, the stronger the eventual breakout will be.
If the price falls below $0.07, the pair could extend its decline to $0.06 and then to vital support near $0.05. Instead, if the price breaks out of the 200-day SMA, the pair can shoot up to the $0.10 to $0.11 resistance zone.
Solana Price Analysis
Solana (SOL) broke below the 20-day EMA ($20.93) on March 24. The buyers tried to push the price above the 20-day EMA on March 25 and 26, but the bears held their ground. This suggests that the bears are trying to turn the 20 day EMA into resistance.
If the price sustains below $20, the SOL/USDT pair could retest the immediate support at $18.70. This level may attract buying, but if the bulls fail to push the price above the 20-day EMA, prospects for a drop to $15.28 increase.
Contrary to this assumption, if the price rises from the current level and breaks above the downtrend line, it indicates that the downtrend may have ended. The pair could first rally to $27 and then attempt a rally to $39.
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