The Bitcoin (BTC) Market has surged to its highest level in two years, reaching nearly $55,000 on February 26, propelled by ongoing interest in spot Bitcoin exchange-traded funds (ETFs). CoinShares said institutional investors invested $570 million into Bitcoin investment vehicles last week.
Since their inception, Bitcoin ETFs have witnessed over $5 billion in net assets under management (AUM), starkly contrasting the $3.6 billion withdrawn from gold ETFs during the identical timeframe. This was highlighted in a February 26 analysis by Eric Balchunas, a senior analyst at Bloomberg, and his colleague, associate analyst Andre Yapp. They predict that the AUM of Bitcoin ETFs will surpass gold ETFs within the next two years.
Bitcoin’s strength is likely to uplift the mood in the crypto space, benefitting select altcoins. However, as Bitcoin approaches its all-time high, the pullback risk can not be ruled out as the bears attempt to stop the rally.
Could the Bitcoin bulls maintain the breakout, or will higher levels tempt short-term traders to book profits? Let’s analyze the charts to find out.
S&P 500 Index (SPX) Market Analysis
The S&P 500 Index skyrocketed above the 5,048 resistance on Feb. 22, indicating the resumption of the uptrend.
Although the upsloping moving averages indicate an advantage to buyers, the negative divergence on the relative strength index (RSI) suggests that the uptrend may be losing steam.
The 20-day exponential moving average (4,983) remains the crucial level to watch out for on the downside. If this support cracks, the index may descend to the 50-day simple moving average (4,857).
Instead, if the index continues higher, it will invalidate the negative divergence. The failure of a negative pattern generally results in a sharp upmove. The index could then rise to 5,200.
U.S. Dollar Index (DXY) Market Analysis
The bears yanked the U.S.Dollar Index below the 20-day EMA (103) on Feb. 22, but the long tail on the candlestick shows aggressive buying at the neckline of the inverse head-and-shoulders pattern.
The flattish 20-day EMA and the RSI near the midpoint do not give a clear advantage to the bulls or the bears. If the price rises and sustains above the 20-day EMA, the bulls will try to drive the index above 105. If they do that, the rally could reach 107.
On the other hand, if the price continues lower from the current level, it will suggest that the bears are trying to make a comeback. The index could then slide to the 50-day SMA (103). A bounce off this level could keep the index inside a range for some time.
Bitcoin (BTC) Market Analysis
Bitcoin broke above the $53,000 overhead resistance on Feb. 26 after consolidating in a tight range for several days. This suggests that bulls remain in control.
If buyers sustain the price above $53,000, the BTC/USDT pair will likely pick up momentum and soar toward $60,000, where the bears are again expected to mount a strong defence.
There are several layers of support on the downside. If $50,500 breaks down, the bulls will try to arrest the decline at the 20-day EMA ($50,075) and then the breakout level of $48,970. The bears will have to tug the price below $48,970 to indicate the start of a deeper correction to the 50-day SMA ($45,734).
Ether (ETH) Price Analysis
Ether surged above the $3,036 resistance on Feb. 25, signalling the start of the next leg of the uptrend.
The upsloping moving averages indicate that bulls are in command, but the overbought zone on the RSI suggests a minor correction or consolidation is possible. If buyers do not allow the price to sustain below $3,000, the likelihood of a rally to $3,300 and then to $3,540 increases.
The first sign of weakness will be a break and close below the 20-day EMA ($2,823). That will indicate aggressive profit booking by the traders. The ETH/USDT pair could plunge to $2,717 and subsequently to the 50-day SMA ($2,546).
BNB Price Analysis
BNB is trying to resume its uptrend, but the overbought level on the RSI suggests that the bears may pose a substantial challenge near the overhead resistance at $400.
If the price turns down from the current level but rebounds off the 20-day EMA ($356), it will suggest that the sentiment remains bullish. That will enhance the prospects of a break above $400. The BNB/USDT pair may then rally to $460.
Contrarily, if the price continues lower and breaks below the 20-day EMA, it will suggest that the bulls are aggressively booking profits. That could sink the pair to the 50-day SMA ($323). A break below this level will tilt the advantage in favour of the Bears.
XRP Price Analysis
XRP has been trading near the moving averages for the past few days, indicating uncertainty about the next directional move.
The flattish moving averages and the RSI just below the midpoint suggest a possible range-bound action in the near term. The boundaries of the range could be $0.48 on the downside and $0.58 on the upside.
Buyers must drive and maintain the price above $0.58 to indicate that the correction may be over. The XRP/USDT pair could then attempt a rally to $0.67 and eventually to $0.74. The support on the downside is at $0.48 and then $0.46.
Solana (SOL) Price Analysis
Solana is finding support at the 50-day SMA ($100), indicating that the bulls are trying to arrest the decline.
The flattish moving averages and the RSI near the midpoint suggest a range-bound action in the near term. Buyers will have to push and maintain the price above the downtrend line to start a rally to the overhead resistance zone between $119 and $127. If this zone is surmounted, the upmove may reach $135.
On the contrary, if the price turns down from the current level or the downtrend line and breaks below the 50-day SMA, it will suggest that the bears are selling on rallies. The SOL/USDT pair could then plummet to $80.
Cardano (ADA) Price Analysis
The bulls managed to protect the 20-day EMA ($0.58) in Cardano, indicating that the sentiment remains positive.
The gradually rising 20-day EMA and the RSI in the positive territory show that the bulls have a slight edge. Buyers will try to pay the overhead resistance zone price between $0.64 and $0.68.
Contrary to this assumption, if the ADA/USDT pair turns down sharply and breaks below the 20-day EMA, it will indicate that the bulls have given up. That could start a correction to the 50-day SMA ($0.54).
Avalanche (AVAX) Price Analysis
Avalanche bounced off the 50-day SMA ($36.12) on Feb. 24, indicating that lower levels attract buyers.
The flattish moving averages and the RSI near the midpoint do not give a clear advantage either to the buyers or the sellers. If the price breaks below the 50-day SMA, the AVAX/USDT pair could descend to $32.
Alternatively, a break and close above the 20-day EMA ($37.84) could open the doors for a rally to the overhead resistance of $42. The bulls must overcome this barrier to signal the completion of an inverse H&S pattern.
Dogecoin (DOGE) Price Analysis
The bulls successfully defended the breakout level from the triangle but failed to propel Dogecoin above the $0.09 overhead resistance.
This indicates a lack of demand at higher levels. The bears will try to gain the upper hand by pulling the price below the moving averages.
The DOGE/USDT pair could drop to the uptrend line if they succeed. This is an essential level for the bulls to defend because if they fail in their endeavour, the pair could start a downward move to $0.07.
The bulls will have to drive and maintain the price above $0.09 to indicate the start of a new move. The pair could surge to the $0.10 to $0.11 resistance zone, where the bears will likely mount a strong defence.
