The Bitcoin (BTC) market and a selection of alternative cryptocurrencies are displaying strength as the new week begins, with traders expanding their focus beyond the flow of spot BTC ETFs.
The United States stock markets are experiencing a positive momentum, buoyed by robust economic growth and indications that annual inflation may moderate. The S&P 500 Index (SPX) recorded a 1.06% gain last week, continuing its ascent towards the psychologically significant 5,000 level.
Similarly, Bitcoin (BTC) exhibited a similar performance, posting a 1.08% increase last week. This achievement is particularly noteworthy given that Bitcoin’s price had dipped to around $38,500 during the week, demonstrating strong buying interest at lower price levels.
Data from the FedWatch Tool shows that the Federal Reserve will hold rates in their Jan. 31 meeting but start cutting rates from their March meeting. An expansive monetary policy is usually a positive sign for risky assets.
Could Bitcoin extend its recovery, or will higher levels attract strong selling by the bears? How are the altcoins expected to behave? Let’s analyze the charts to find out.
S&P 500 Index (SPX) market analysis
The S&P 500 Index continued its northward march last week, indicating solid demand from the bulls at higher levels.
The index faces some resistance at 4,900, but a positive sign is that the bulls have not ceded ground to the bears. This suggests that the buyers expect the uptrend to resume. If buyers kick the price above 4,907, the index could reach the 5,000 level, where the bears may mount a strong defence.
The critical support to watch on the downside is the 20-day exponential moving average (4,806). A slide below this support could clear the path for a deeper correction to the 50-day simple moving average (4,694).
U.S. Dollar Index (DXY) market analysis
The recovery in the U.S. Dollar Index faces resistance at the downtrend line, but a positive sign is that the bulls have not allowed the price to dip below the moving averages.
The rising 20-day EMA (103) and the relative strength index (RSI) in the positive territory indicate the path of least resistance is to the upside. If buyers push and maintain the price above the downtrend line, the index may climb to 104.50 and later to 106.
Contrary to this assumption, if the price turns down from the overhead resistance and breaks below the moving averages, it will signal that the bears are fiercely defending the downtrend line. The index may then slip to 102.
Bitcoin (BTC) market analysis
Buyers tried to drive Bitcoin above the 50-day SMA ($42,795) on Jan. 28 and 29, but the bears held their ground. The flat moving averages and the RSI near the midpoint do not give a clear advantage either to the bulls or the bears.
If bulls push the price above the 50-day SMA, the BTC/USDT pair could reach $44,700. This level is likely to attract strong selling by the bears. If the price turns down from $44,700 and breaks below the moving averages, it will indicate that the range-bound action may continue for a few more days.
On the other hand, if the price slips and maintains below the 20-day EMA ($41,950), the pair may gradually dip toward $40,000 and then $37,980. The next trending move will likely begin after buyers shove the price above $44,700 or bears sink the pair below $37,980.
Ether (ETH) market analysis
The long wick on Ether’s (ETH) Jan. 28 candlestick shows that the bears are selling near the moving averages.
The 20-day EMA ($2,340) has started to turn down, and the RSI is in the negative zone, indicating that the bears have a slight edge. Sellers will try to pull the price to $2,168 and then to the strong support at $2,100. A strong rebound off this level may keep the ETH/USDT pair stuck inside the $2,100 to $2,400 range for a while.
The first sign of strength will be a break and close above the moving averages. The pair may then rise to $2,400, which is a critical resistance to keep an eye on. If this level is scaled, the pair may climb to $2,600.
BNB market analysis
BNB has been trading inside the descending triangle pattern for the past few days, indicating that the bears are trying to take control.
However, a positive sign is that the bulls successfully defended the $288 support and pushed the price above the 20-day EMA ($304). The BNB/USDT pair could reach the downtrend line, a substantial resistance to watch out for.
The bearish pattern will be invalidated if buyers propel the price above the downtrend line. The pair may then rally toward $338.
The sentiment will turn negative after bears tug the price below the $288 support and complete the descending triangle pattern. That may start a fall to $260.
XRP market analysis
XRP has been stuck inside an extensive range between $0.46 and $0.74 for several months, indicating buying at support and selling near resistance.
The moving averages are sloping down, and the RSI below 37 indicates that the bears hold the edge. Sellers will try to sink the price below the psychological support at $0.50 and challenge the crucial level of $0.46. Buyers are expected to vigorously defend the $0.46 support as a break below it may result in a fall to $0.41.
The bulls must push and maintain the price above the downtrend line to signal a comeback. The XRP/USDT pair may jump to $0.67 and eventually to $0.74.
Solana (SOL) price analysis
The bulls are trying to sustain Solana above the downtrend line is the first sign that the correction may be ending.
The flattish moving averages and the RSI just above the midpoint suggest a balance between buyers and sellers. A break above $104 could tilt the advantage in favour of the Bulls. The SOL/USDT pair may then rise to $117.
On the contrary, if the price turns down sharply and breaks below the moving averages, it will indicate that the bears are active at higher levels. That may trap the aggressive bulls and pull the pair to $80.
Cardano (ADA) price analysis
Cardano’s ADA pullback reached the 20-day EMA ($0.50) on Jan. 28 and acts as a stiff resistance, as seen from the long wick on the candlestick.
If the price turns down from the current level, the bears will try to pull the ADA/USDT pair to the channel’s support line near $0.42. The bulls will try to defend this level because if they fail in their endeavour, the pair may plummet to $0.35.
On the upside, a break above the 20-day EMA will open the doors for a possible rally to the channel’s downtrend line. Buyers must pierce the downtrend line to indicate that the correction may end.
Avalanche (AVAX) price analysis
Avalanche rose above the 20-day EMA ($34) on Jan. 28, indicating that the bulls are attempting a comeback, but the long wick on the candlestick shows that the bears may not give up easily.
The AVAX/USDT pair could reach the downtrend line, which is likely to act as a significant barrier. If the price turns down sharply from the current level or the downtrend line and breaks below the 20-day EMA, the pair may remain inside the channel for some more time.
Buyers will have to drive the price above the channel to indicate a potential trend change in the near term. The pair may start an up move toward $44 and attempt a rally to the psychologically important level of $50.
Dogecoin (DOGE) price analysis
The bulls failed to push Dogecoin above the 20-day EMA ($0.08) on Jan. 28 but kept up the pressure and cleared the hurdle on Jan. 29.
The downsloping moving averages indicate an advantage to bears, but the RSI near the midpoint suggests that the bearish momentum may be reducing. If buyers sustain the price above the 20-day EMA, the DOGE/USDT pair could rise to the downtrend line. The bears have successfully defended the level in the past and will try to do that again.
However, if buyers overcome the obstacle at the downtrend line, the pair may start its journey toward the $0.10 to $0.11 resistance zone. The critical support on the downside is $0.07.
