Crypto markets are turning green following the continuation of last week’s rally in stocks, and SOL, XMR, LDO and AAVE may be poised to move higher.
Bulls and bears were keeping an eye on the consumer price index (CPI) reading due on January 12, after jumping to $17,375 on January 12 and finally breaching the $17,000 mark. There may be a rally, but a downside surprise will attract strong selling.
While some believe a macro bottom is forming in Bitcoin, others remain skeptical. They draw a parallel between the current bear market and the bursting of the dot-com bubble. The United States Federal Reserve stopped raising rates in May 2000, but the Nasdaq hasn’t moved lower in two years. If the same scenario plays out with cryptocurrencies, the next race may not start in a hurry.
Daily overview of crypto market data. Source: Coin360
However, one thing that bodes well for the future of the crypto industry is that legacy financial companies continue to show interest in the space. Jess Mohidin, co-founder and CEO of Laser Digital, believes that the arrival of traditional companies will help regulate the cryptocurrency sector.
Are Charts Pointing To A Bitcoin Rally? What other altcoins are showing a positive chart structure? Let’s find out.
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BTC / USDT
Bitcoin is trading above its moving average since January 4th. This is the first sign that selling pressure will ease. On January 6, the price reached overhead resistance at $17,061, but the bulls failed to break above this level. This suggests that the bears have not yet given up.
BTC/USDT Daily Chart. Source: TradingView
A small positive in favor of the bulls is that they did not allow the BTC/USDT pair to fall below the moving average. If the price consolidates between the moving average and $17,061 for some time, the chances of a break above the overhead resistance will improve. If the bulls bounce back above $17,061, the pair could reach $18,388.
Alternatively, if the price declines and breaks below the moving average, this would indicate that the pair will be stuck between $17,061 and $16,256 for several days.
BTC / USDT 4-Hour Chart. Source: TradingView
The four-hour chart shows that while the bears are holding the $17,061 level, they have failed to push the price below the 20-day exponential moving average (EMA). This suggests that buyers are not rushing for the exit as they expect a break above the overhead resistance.
A gradual rise in the 20-EMA and the Relative Strength Index (RSI) in positive territory suggest that buyers have a slight advantage. A break above $17,061 indicates the start of a new uptrend in the near future.
If the bears want to regain control, then the pair may break below the 50-day moving average (SM).
Although the price level of the last few days has not performed well in the last few months, the possibility of a relief rally is increasing. It is too early to predict whether the expected move will be the bounce of a dead cat or the start of a sustained recovery. However, this setup may be of interest to short-term traders.
SOL/USDT Daily Chart. Source: TradingView
The SOL/USDT pair bounced back sharply from the lows of $8 on December 29. Buyers pushed the price above the 50-day SMA ($12.75) on January 3 and the pair has managed to hold above this level since then. This shows that the bulls are trying to move the moving average of support.
If the price breaks above the overhead resistance at $15, the pair may accelerate to $19. This level could again serve as a barrier, but if broken, the rally could extend to the 50% Fibonacci retracement level of $23.40.
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The bulls may lose control if the price declines and moves below the average moving average. Such a move would indicate that the bears are active at higher levels.
SOL/USDT 4 Hours Chart. Source: TradingView
The 4-hour chart shows that the price pulled back to the 20-EMA, but the bulls bought this dip. This indicates a shift in sentiment from selling on rallies to buying on dips. The bulls will try to continue the upward movement by pushing the price above the $14.24 to $15 resistance zone.
On the other hand, the Bears 20-E