Crypto traders expect trading ranges to widen after the conclusion of the Jackson Hole symposium and the release of the Fed’s views on inflation, higher interest rates and the state of the economy.
Bitcoin (BTC) and several major cryptocurrencies are trading sideways as traders avoid making big bets in the coming days ahead of the Federal Reserve’s economic symposium in Jackson Hole, which begins Aug. 25.
On Aug. 23, a team led by Goldman Sachs chief economist Jan Hatzius said Fed Chair Jerome Powell might appear dovish in his Aug. 26 speech, reiterating that the central bank will slow down at future meetings could. Analysts expect the Fed to hike rates by 50 basis points at its September meeting, down from the 75 basis point hikes in June and July.
Cryptocurrency market daily indicators. Source: Coin360
While short-term price action remains uncertain, on-chain data suggests that Bitcoin may be undervalued, meaning it could offer strong returns if history repeats itself. According to Jarvis Labs-based analyst JJ, the value of the Bitcoin Market Capitalization vs. Realized Capitalization indicator is at its lowest since 2015. Bitcoin’s bottom in 2015 and 2019 was formed when the indicator hit a low value, but he reached extremely low levels in 2022.
Which critical values do you have to pay attention to when ascending and descending? Let’s examine the charts of the top 10 cryptocurrencies to find out.
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Bitcoin has been trading near the support line of the rising channel since Aug. 19. Although the bulls successfully defended the support, they failed to recover strongly from it. This suggests that demand is drying up at higher levels.
BTC/USDT daily chart. Source: Trade View
The 20-day exponential moving average (EMA) ($22,523) has started turning down and the relative strength index (RSI) is approaching 41, suggesting a slight advantage for the bears. If the price breaks the channel support line, selling might increase and the BTC/USDT pair could drop to $18,900.
To negate this negative view, the bulls need to push and sustain the price above the moving averages. If so, it would mean that the pair could gradually rise towards the channel resistance line around $26,000.
The bulls are aggressively defending the 50-day SMA ($1,571) as seen on the long-tail candlestick on August 22-23. Ether (ETH) will now attempt to scale above the 20-day EMA ($1,712).
Daily ETH/USDT chart. Source: Trade View
In that case, the ETH/USDT pair could gain momentum and climb towards the $2,000 tough upper resistance. The bears are expected to defend this level aggressively.
Contrary to this assumption, a downward move in price from the upper resistance level would indicate that the bears are attempting to turn the 20-day EMA into resistance. The pair could then remain stuck between the moving averages for a few more days.
If the price breaks below the 50-day SMA and the $1,500 support, selling could pick up and the pair could drop to strong support at $1,280.
A tight squeeze is usually followed by an expansion in volatility, but it’s difficult to predict the direction of a breakout with certainty. Therefore, it is better to wait for a breakdown before opening new positions.
BNB’s rebound from $275 is facing strong resistance at the 20-day EMA ($301). On the positive side, the bulls have not lost many positions as they expect the uptrend to continue.
BNB/USDT daily chart. Source: Trade View
If the price increases from the current level and surpasses $305, the BNB/USDT pair could rally to the upper resistance at $338. Such a move would form an inverse head and shoulders pattern that would end with a breakout and close above $338.
In that case, the pair could rally to $420 and then $460. The target pattern for this bullish setup is $493.
Alternatively, the pair could drop to $275 if the price declines sharply from current levels. A break below this level completes the head and shoulders pattern. The pair could then drop to $240 and then $212.
Ripple (XRP) has been trading for the past four days