GBTC market outflows possibly contributed to a correction in the cryptocurrency market. However, the aggressive purchasing of Bitcoin (BTC) within the remaining nine Bitcoin ETF spots might help curtail the extent of this downward movement.
Bitcoin (BTC) is currently engaged in a challenging struggle between bullish and bearish forces, particularly around the $40,000 price point. While buyers express optimism regarding the future potential of recently introduced Bitcoin exchange-traded funds (ETFs), sellers are directing their attention to the substantial $3.4 billion in outflows from the Grayscale Bitcoin Trust.
In addition to cryptocurrency-specific concerns, some analysts harbour apprehensions regarding the deteriorating macroeconomic environment. Arthur Hayes, the former CEO of BitMEX, cautioned investors in his recent blog post that Bitcoin could face a decline ranging from $35,000 to $30,000. According to Hayes, the United States Federal Reserve might encounter difficulties in reducing interest rates in the near term, given the potential for inflation stemming from increased shipping costs due to Houthi attacks on ships in the Red Sea.
Several analysts have turned bearish in the short term, but solid demand from the newly launched Bitcoin ETFs may limit the downside. Within seven days of their launch, the nine spot Bitcoin ETFs have amassed over 100,000 Bitcoin.
What are the crucial levels that may attract buying in Bitcoin and altcoins? Let’s analyze the charts of the top 10 cryptocurrencies to find out.
Bitcoin (BTC) price analysis
Bitcoin plunged below the $40,000 support on Jan. 22, indicating that the bulls are rushing to the exit. The price slipped near the strong support of $37,980, which will likely hold in the short term.
The price attempts to bounce off $37,980, but the bulls may face stiff resistance at the 20-day exponential moving average ($42,116). If the price turns down from the 20-day EMA, the BTC/USDT pair will risk a fall below $37,980. The pair may slump to the next strong support at $34,000 in that case.
Buyers are expected to defend the zone between $34,000 and $37,980 aggressively. They must kick the price above the 20-day EMA to signal a comeback. The bullish momentum may pick up after the pair jumps above $44,700.
Ether (ETH) price analysis
Ether’s weak bounce off the 20-day EMA ($2,395) on Jan. 19 attracted further selling by the bears, who tugged the price below the breakout level of $2,400 on Jan. 22.
The 20-day EMA has started to turn down, and the RSI is near 40, indicating that bears have a slight edge. Sellers will try to sink the price to the strong support at $2,100. The bulls are expected to protect the level with all their might because a drop below it may start a new downtrend toward $1,900.
This negative view will be invalidated soon if the bulls maintain the ETH/USDT pair above the downtrend line. The pair will then try to rally to $2,614 and $2,717.
BNB price analysis
BNB’s reversed direction from the downtrend line on Jan. 22 and closed below the 20-day EMA ($305), indicating aggressive selling on rallies.
The price action of the past few days has formed a descending triangle pattern, which will complete on a break and close below $288. If that happens, the bears will try to drag the price to the neckline and then to $232.
Contrarily, if the price bounces off $288 with strength, it will suggest that the bulls fiercely protect the level. The BNB/USDT pair may then rise to the 20-day EMA. A break above this level will pave the way for a possible rally to the downtrend line.
Solana (SOL) price analysis
Solana has been in a pullback for the past few days. The bears strengthened their hold further by pulling the price below the 50-day SMA ($91) on Jan. 22,
The moving averages are on the verge of a bearish crossover, and the RSI is in the negative zone, indicating that the path of least resistance is to the downside. There is minor support at $77, but if this level allows, the SOL/USDT pair could complete a 100% retracement and fall to $64.
The downtrend line is the primary barrier to watch out for on the upside. If buyers drive the price above the downtrend line, it will suggest that the corrective phase may be over. The pair may then jump to $107.
XRP price analysis
XRP turned down from the 20-day EMA ($0.56) on Jan. 15 and slipped below the immediate support of $0.54 on Jan. 19.
The 20-day EMA slows down, and the RSI is near the oversold territory, indicating that bears are in the driver’s seat. Sellers will try to tug the price to $0.46, where buyers will likely step in. However, any bounce is expected to face selling at the 20-day EMA. If the price turns down and breaks below $0.46, a retest of $0.41 may be on the cards.
Bulls must propel and maintain the price above the downtrend line if they want to prevent the downside. The pair may then rise to $0.67.
Cardano (ADA) price analysis
Cardano has been falling inside a descending channel pattern for the past few days, indicating that higher levels are being sold into.
The downsloping 20-day EMA ($0.52) and the RSI in the negative territory indicate that the bears are in control. Sellers will try to strengthen their position further by yanking the price below the channel. If they do that, the selling could accelerate, and the ADA/USDT pair may dive to $0.35.
Instead, if the price bounces off the channel’s support line, the bulls will attempt to overcome the barrier at the 20-day EMA. If they succeed, the pair may ascend to the downtrend line of the channel.
Avalanche (AVAX) price analysis
Avalanche attempted a relief rally off the $31 support on Jan. 19, but the weak bounce shows that bears continue to pound on every minor rise.
Intense selling pressure pulled the price below the $31 support on Jan. 22. The bulls are trying to push the price back above the breakdown level of $31, but the recovery will likely hit a wall at the 20-day EMA ($34.32). If the price drops from the 20-day EMA, the AVAX/USDT pair may fall to $24.
On the contrary, if bulls push the price above the 20-day EMA, it will signal that the selling pressure could be reduced. The price may then climb to the 50-day SMA ($37.63).
Dogecoin (DOGE) price analysis
Dogecoin started a recovery on Jan. 20, but the bulls could not clear the overhead hurdle at the 50-day SMA ($0.09). This shows that bears remain active at higher levels.
The price has reached strong support near $0.07, having been held on three previous occasions. If the price rebounds off this level with force, it will suggest that the DOGE/USDT pair may oscillate between $0.07 and $0.09 for a few days.
Instead, if the price continues lower and breaks below $0.07, it will open the doors for a possible fall to $0.06.
The first sign of strength will be a rise above the 50-day SMA. The pair may climb to the $0.10 to $0.11 resistance zone.
Polkadot (DOT) price analysis
Polkadot plunged below the neckline of the head-and-shoulders pattern on Jan. 22, indicating that the bears are in command.
The bulls will try to push the price back above the neckline but will likely face stiff resistance from the bears. If the price turns down from the neckline, it will signal that the bears have flipped the level into resistance. That will increase the likelihood of a further downside to $4.80.
On the contrary, if bulls push the price back above the neckline, it will indicate strong buying at lower levels. The downside risk will reduce after the DOT/USDT pair sustains above the moving averages.
Chainlink (Link) price analysis
Chainlink has been trading inside an extensive range between $12.85 and $17.32 for several days, indicating buying at lower levels and selling on rallies.
Both moving averages are flattish, and the RSI is just below the midpoint, indicating a slight advantage to the bears. The LINK/USDT pair could drop to the support of the range at $12.85, where buying is likely to emerge. If the price rebounds off this level with strength, it will suggest that the range-bound action may continue for some more time.
The bears will gain the upper hand if they sink and sustain the price below $12.85. That could start a fall to $12 and, after that, to $10.50.
