Bitcoin and altcoins are holding their immediate support levels but traders are looking for a trigger to propel the market higher.
Cryptocurrency markets were quiet over the weekend. The sideways price action will continue on Sept. 5 and no new triggers are likely to come from US stock markets which are closed on Labor Day.
However, the positive picture for cryptocurrencies looks bleak as Europe’s energy crisis has sent the euro to a two-decade low against the US dollar. Meanwhile, the US Dollar Index (DXY), which is inversely correlated with stocks and cryptocurrencies, rose above 110 points for the first time since June 2002.
Cryptocurrency market daily indicators. Source: Coin360
On a positive note amid all this chaos, Bitcoin (BTC) has not lost much ground over the past few days and continues to trade near the psychological $20,000 level. This suggests that traders are not panicking and in no hurry to sell positions.
Can the bulls push and hold Bitcoin above $20,000 and will this trigger altcoin buying? Let’s examine the charts of the top 10 cryptocurrencies to find out.
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Bitcoin/US Dollar
Bitcoin has been stuck in a tight range between $19,520 and $20,576 for the past few days. This indicates the indecisiveness of the bulls and bears. Although the bulls are buying on dips, they have failed to clear the upside resistance.
BTC/USDT daily chart. Source: Trade View
The descending 20-day exponential moving average (EMA) ($20,775) and the Relative Strength Index (RSI) in negative territory increase the likelihood of a break below $19,520. In that case, the BTC/USDT pair could drop into a strong support zone between $18,910 and $18,626.
Buyers are expected to do their best to protect this area. If the rebound breaks the 20-day EMA, the pair could rally to the 50-day SMA (simple moving average) ($22,253). The bulls need to clear this hurdle to open the doors for a potential move to $25,211.
On the other hand, if the bears sink the price below $18,626, the pair could retest the last support at $17,622. A break below this support could signal a resumption of the downtrend.
ETH/USDT
Ether (ETH) has been stuck between the 20-day EMA ($1,605) and the head and shoulders (H&S) neckline since August 31, but this tight trade is unlikely to last.
Daily ETH/USDT chart. Source: Trade View
If buyers push and sustain the price above the 20-day EMA, ETH/USDT could rally to the upper resistance at $1,700. This is an important level to watch as a break and close above it can signal that the bulls are back in control of the market. The pair could then scale to $2030 and then a downtrend line.
This optimistic view will be invalidated in the near term if the price breaks away from the moving averages and falls below $1422. In that case, the pair could drop to $1,280. The bulls are expected to defend this level vigorously, but if the bears defeat them, the decline could extend to the $1,050 target.
BNB/USDT
BNB has been trading near the strong $275 support for the past few days, but the bulls have been unable to extract a strong bounce from it. This indicates a lack of demand at higher levels.
BNB/USDT daily chart. Source: Trade View
The 20-day EMA ($286) is sloping down and the RSI is below 41, indicating the bears are taking over. If the price breaks out and closes below $275, the BNB/USDT pair will complete the bearish head and shoulders pattern. The pair could then start lowering to $240 and then the $212 target.
Contrary to this assumption, if the price breaks out of the current level and breaks through the moving averages, it means the bulls are back in the game. The pair could then rally to an upper resistance level at $308.
XRP/USDT
Ripple (XRP) has been stuck between $0.32 and $0.34 for the past few days, but this tight trade is unlikely to last long.
Daily XRP/USDT chart. Source: Trade View
The bears will attempt to sink the price below $0.32. If successful, XRP/USDT could continue falling to the critical support at $0.30. Buyers are likely to aggressively defend this level as they did in the previous three
