On November 29, global cryptocurrency and stock markets saw a dramatic improvement despite uncertainty over the recently discovered Omicron COVID-19 variant.
Long-term investors seem to see the recent downturn as an important buying opportunity. A recent report from MicroStrategy shows that the company bought 7,002 bitcoins (BTC) at an average price of $ 59,187. This increased MicroStrategy’s total supply to 121,044 bitcoins, acquired at an average price of around $ 29,534 per coin.
Daily performance in the cryptocurrency market. Source: Coin360
However, Research Source cited Material Scientist orderbook data that “much of Bitcoin’s liquidity has been taken away,” and warned that “stop hunters” might try to get rid of weak hands by falling.
Is the current recovery a bull trap or the start of a sustained emergency? Let’s take a look at the charts of the top 10 cryptocurrencies to find out.
BTC / USDT
Bitcoin’s comfortable rally meets resistance at the 20-day exponential moving average ($ 58,712). This indicates that sentiment remains negative and that the bears are trying to sell in a rally towards the upper resistance level.
BTC / USDT daily chart. Source: TradingView
Although the 20-day moving average continues to decline, the RSI climbed above 46, indicating that the bearish momentum may weaken.
The bulls should push the price and hold it above the 50-day simple moving average (SMA) ($ 60,805) to signal that the retracement phase may end. The rally could then challenge the upper resistance range of $ 67,000 to $ 69,000.
On the other hand, if the price drops sharply from the 20-day moving average, the bears will try to break the strong support of the 100-day simple moving average ($ 54,184). If this happens, the BTC / USDT pair could fall to the psychologically critical level of $ 50,000.
Bulls are expected to aggressively defend this level as a break below it could lead to panic selling. The pair could then move to the next major support level of $ 40,000.
ETH / USDT
Ether (ETH) returned from the throat to the developing head and shoulder pattern (H&S) on November 28, indicating that the bulls are defending the level with all their might. Continuous buying pushed the price above the 20-day moving average ($ 4,316) on November 29.
ETH / USDT daily chart. Source: TradingView
An eruption and a close above the overall resistance at $ 4,551 would indicate that the correction could end. ETH / USDT may rise to an all-time high of $ 4,868. A break above this level will nullify the bearish setup and open the door for a potential rally to $ 5,796.
Alternatively, if the price falls below the current level and falls below the 50-day moving average ($ 4,243), the bears will make another attempt to lower the pair below the neck. A close below this level will end the bearish sentiment and begin a downward movement.
Selling could accelerate below the 100-day simple moving average ($ 3,794). The pair can then begin their journey towards the $ 3,047 target.
BNB / USDT
The long tail of the Binance Coin (BNB) candle on November 28 indicates that bulls are buying below the 20-day moving average ($ 595). Now the bulls will try to push the price towards the upper resistance zone from $ 669.30 to $ 691.80.
BNB / USDT daily chart. Source: TradingView
A break and close above $ 669.30 will complete an inverted vertical and reversal downtrend pattern. This bullish setup has a target of $ 828.60. The 20-day EMA is trying to rise and the RSI is at 56, indicating that the bulls are trying to grab the lead.
The first sign of weakness would be to erupt and exit below the 20-day moving average. The bears will then try to move lower and keep the price below the 50-day simple moving average. Such a move could trigger a fall to the strong support level of $ 510.
SOL / USDT
On November 28, Solana (SOL) fell below the symmetrical triangle’s guideline, but the bears were unable to hold the lower levels. This indicates strong buying on downturns.
SOL / USDT daily chart. Source: TradingView
SOL / USDT has broken above the 50-day SMA ($ 204) on November 29 and the bulls will now try to break above the 20-day SMA ($ 212). If they succeed, the pair could rise to the resistance line, where bears could be a serious test.
An eruption and a close above the resistance line would indicate that the correction could end. The pair could then rise to $ 240 and then to $ 259.90.
