Worrying news from Silvergate Bank and FTX may have influenced investors’ decision to hit the sell button, but the potential for further decline could be limited.
Bitcoin (BTC) is leading the cryptocurrency markets lower and the matter is compounded by the ongoing problems at Silvergate Banks. This week, the cryptocurrency-focused bank said it needed additional time to file its annual 10-K and warned it may not be able to operate for another 12 months. In reaction to this news, several cryptocurrency companies announced that they would be reducing or terminating their partnerships with Silvergate Bank.
The uncertainty about the future of the bank and its overall impact on the cryptocurrency sector may have caused a knee-jerk reaction. However, if the contagion does not spread, the downside may be limited.
Another positive for the cryptocurrency markets is that the US stock markets are trying to kick start a recovery. This suggests that traders continue to add risk to their portfolios at lower levels. This risk sentiment may limit the downside in Bitcoin and select altcoins.
What are the important levels on the downside that can act as support and start a rally in Bitcoin and major altcoins? Let’s study the charts of the top 10 cryptocurrencies to find out.
USDT/BTC
The failure to break above the $24,000 level may have tempted traders to book profits. The selling accelerated on March 3 and the bears pulled the price below the immediate support at $22,800.
The 20-day exponential moving average ($23,332) is still flat, but the RSI has plunged below 44, indicating that near-term momentum has turned bearish. The next crucial support to watch on the downside is $21,480.
Buyers are expected to defend this level with all their might because a break and close below could open the doors for a retest of the psychologically important $20,000 level.
Alternatively, if the price bounces off $21,480, the bulls will attempt to clear the overall hurdle at $22,800. If they do, it will indicate that the BTC/USDT pair may remain stuck between $21,480 and $25,250 for a few more days.
EUR/USDT
Ether (ETH) once again turned down the overhead resistance of $1680 on March 2, indicating that the bears are defending the level vigorously.
Traders seem to have sold aggressively on March 3, which broke the support at the 50-day SMA ($1607). The ETH/USDT pair may then drop to the critical support at $1,461, where buyers may try to stop the pullback.
If the price bounces strongly from $1461, it will suggest that the pair may remain range bound for a few days. The bulls will be back in the game if they push and hold the price above $1,680. Conversely, if the price falls below $1,461, the correction could deepen to $1,352.
USD/USDT
The symmetrical triangle pattern in BNB (BNB) resolved to the downside on March 3, indicating that the bears have beaten the bulls.
The BNB/USDT pair could plummet to the strong support at $280. This is an important level to watch because if it is broken, the pair will complete a bearish head and shoulders pattern. This negative setup has a target of $245.
If the bears want to avoid the sharp drop, they will have to fiercely protect the $280 level. If the price bounces off this level, the pair can range from $280 to $318 for a while longer. The pair could turn bullish above $338.
USD/XRP
The bulls pushed XRP (XRP) to the 20-day EMA ($0.38) on March 1, but were unable to break above the upper barrier. This suggests that sentiment remains negative and traders are selling rallies.
The bears lowered the price on March 2 and increased the selling pressure on March 3. This took the price below the strong support at $0.36. If the price sustains below this level, the decline can extend to the support line of the descending channel pattern.
If the bulls want to gain advantage in the short term, they will have to push the price above the resistance line of the channel. If they do, the XRP/USDT pair may start an upward march to $0.43.
ADA/USDT
Cardano (ADA) tried to rally from $0.34 on March 1, but the bears sold to higher levels and pulled the price below the support on March 3.
The long tail of the candle for the day shows that the bulls are trying to project the support at $0.32. The buyers will have to push the price above $0.34 if they want to strengthen their position. The ADA/USDT pair could then rally to the 20-day EMA ($0.37), where the bulls may face stiff resistance from the bears.
If the price turns down from the overhead resistance and dips below $0.32, it will suggest that the bears have taken over. The pair could start the next leg of the decline at $0.27.
DOGO/USDT
Dogecoin (DOGE) fell below the $0.08 support on March 3, completing the bearish descending triangle pattern.
The DOGE/USDT pair could drop to support near $0.07 first. Buyers are expected to aggressively protect this level. If the price rises from this level, the bounce could go as far as $0.08. This is where the bulls and the bears are likely to have a tough battle for supremacy.
If the price turns below $0.08, it will suggest that the bears have turned the level into resistance. That may increase the possibility of a drop to the pattern’s target of $0.06. On the other hand, if the buyers push the price above $0.08, the pair can rally to $0.10.
MATIC/USDT
Polygon (MATIC) jumped from the 50-day SMA ($1.18) on March 1, but the bulls were unable to overcome the overhead hurdle at the 20-day EMA ($1.27).
The selling gained momentum on March 3, and the bears pushed the price below the 50-day SMA. If the price sustains below the 50-day SMA, the MATIC/USDT pair could slide to the strong support at $1.05.
Another possibility is that the price recovers ground and closes above the 50-day SMA. If that happens, it will be a strong buy signal at lower levels. The bulls will once again try to break through the $1.30 barrier and take the lead.
Related: Bitcoin Price Settles at $22,400 as Daily RSI Retraces 2023 Bull Run
SOL/USDT
Once again, the bulls failed to push Solana (SOL) above the 20-day EMA ($22.77) on March 1. That brought in more sales and brought the price closer to $19.68.
The 20 day EMA started to turn down and the RSI slid near 43, indicating that the bears have a slight advantage. The SOL/USDT pair could reach the important support at $19.68, which may attract solid buying by the bulls.
If the price bounces hard off $19.68, the bulls will try again to push the pair above the 20-day EMA and challenge the resistance line. Conversely, if the support at $19.68 is broken, the pair may see aggressive selling which could sink the price to $15.
POINT/USDT
The bulls pushed Polkadot (DOT) above the 50-day SMA ($6.47) on March 1, but were unable to break above the 20-day EMA ($6.60). This indicates that the bears are selling on minor rallies.
The price turned lower on March 2 and once again broke below the 50-day SMA. That may have caught aggressive bulls by surprise. The selling gained momentum on March 3 and the bears are trying to sink the DOT/USDT pair to the strong support of $5.50. The bulls are expected to fiercely defend this level.
The 20 day EMA remains the key resistance to watch on the upside. A break above will be the first indication that the selling pressure may be easing.
USDT/USDT
Litecoin (LTC) bounced off the 50-day SMA ($93) on February 28 and broke above the 20-day EMA ($94) on March 1. However, the bulls were unable to sustain the higher levels.
The price turned down from $98 on March 2 and broke below the moving averages on March 3. This may have triggered stops from several short-term buyers, pushing the LTC/USDT pair towards the first support near $85. If this level does not hold, the pair can plunge to $81 and then $75.
Important resistance levels to watch on the upside are the moving averages, and then $98. Buyers will have to demolish both barriers if they want to signal a comeback.
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