Bitcoin (BTC) has experienced a strong rally, surpassing $52,000 and continuing to show signs of sustained demand. According to a report by CryptoQuant, more than 75% of new Bitcoin investments are coming from spot Bitcoin exchange-traded funds. However, analysts are cautious about the rally, suggesting that it may be overheated in the short term and could lead to a sharp correction.
Macroeconomic factors could also pose a challenge to the market rally. Initially, there was a 63% probability of a 25 basis points rate cut by the Federal Reserve in March, but this expectation has dwindled to 10.5% after the Consumer Price Index and the Producer Price Index numbers for January exceeded market forecasts.
The question now is whether Bitcoin will undergo a correction in the near term and if this will impact altcoins. Let’s analyze the charts of the top 10 cryptocurrencies to find out.
Bitcoin Price Analysis:
Bitcoin has faced resistance near $52,000, but the bulls have held their ground, indicating that they are not rushing to book profits. The 20-day exponential moving average suggests that the bulls have the upper hand, but the relative strength index (RSI) above 81 indicates that the rally may have occurred too quickly in the short term. A turn down from the current level and a bounce back from $48,970 would signal that the bulls have turned this level into support, increasing the possibility of further upward movement. Maintaining above $52,000 could lead to a rally to $60,000, while a drop below the 20-day EMA would pose a short-term reversal risk.
Ether Price Analysis:
Ether has broken above the $2,717 resistance, indicating a resumption of the uptrend. The next target is the psychologically important level of $3,000. However, the RSI suggests that the rally may be overheated in the short term, potentially leading to a minor correction or consolidation. Bouncing off $2,717 would suggest bullish sentiment and buying opportunities on dips, while a drop below this level would indicate weakening bulls and a potential decline to the 20-day EMA.
Solana Price Analysis:
Solana turned down from $119 and is likely to retest the neckline of the inverse head-and-shoulders pattern at $107. If the price rebounds from the neckline, it would suggest bullish support and enhance the prospects of a break above $126. On the other hand, a break below the neckline would indicate continued bearish selling, with bulls attempting to stop the fall at the moving averages. However, if they fail, the pair could slide to $93.
BNB Price Analysis:
BNB broke above the descending triangle pattern and the overhead resistance of $338, signaling a bullish trend. However, the long wick on the candlestick shows resistance near $366. A drop below $338 would weaken the bulls and potentially lead to a decline to the 20-day EMA. On the contrary, consolidating near the current level would suggest anticipation of continued upward movement, with a break above $366 opening the doors to a possible rise to $400.
XRP Price Analysis:
XRP turned up from the 20-day EMA and broke above the 50-day SMA, indicating steady buying at higher levels. The price has reached the downtrend line, where a battle between bulls and bears is expected. Overcoming this resistance could accelerate the pair towards $0.67, with minor resistance at $0.62 likely to be surpassed. However, a sharp downturn and a break below the 20-day EMA would suggest strong bearish defense, potentially leading to a decline to $0.50.
Cardano Price Analysis:
Cardano broke above the immediate resistance at $0.57, with the upsloping 20-day EMA and positive RSI indicating a slight advantage for bulls. Overcoming minor resistance at $0.62 could lead to a rally to the stiff overhead resistance at $0.68. On the downside, breaking and closing below the 50-day SMA would suggest a possible bull trap, with a potential plunge to $0.46.
Avalanche Price Analysis:
Avalanche briefly broke above the $42 resistance but failed to sustain higher levels. A dip to the 20-day EMA is expected, and a bounce from this level would increase the likelihood of a break above $42. If that happens, the pair could rally to $50. However, if the price continues to decline and breaks below the moving average, the pair may trade between $32 and $42 for some time.
Dogecoin Price Analysis:
Dogecoin turned up from the 20-day EMA and broke above the downtrend line, indicating bullish intent. Maintaining above the downtrend line could lead to a surge towards the $0.10 to $0.11 resistance zone, which is expected to be defended by bears. Conversely, a drop below the 20-day EMA would suggest selling at higher levels, potentially leading to a decline to the uptrend line and the strong support at $0.07.
Chainlink Price Analysis:
Chainlink has faced profit booking near $20.85, but the bulls have held their ground. The upsloping 20-day EMA and positive RSI indicate a positive sentiment and anticipation of an uptrend resumption. A break above $20.85 could lead to a move to the pattern target of $21.79, while a violation of the 20-day EMA may result in a decline to $17.32.
Polkadot Price Analysis:
Polkadot has sustained above the 50-day SMA, indicating buying from bulls. The moving averages are on the verge of a bullish crossover, and the positive RSI suggests a comeback by the bulls. The 20-day EMA is likely to act as support, and the bulls will aim to push the price to $8.58. However, a sharp downturn and a break below the moving averages would negate this view, potentially leading to a decline to $6.
Disclaimer: This article is not investment advice or a recommendation. Readers should conduct their own research before making any investment decisions.