The drop in US stock markets last week extended the streak of losses across the market for three consecutive weeks. The Nasdaq Composite fell for six consecutive days for the first time since 2019. Markets’ negative reaction to an apparently positive August jobs report shows traders are nervous about the FED’s future actions and its impact on the economy. Meanwhile, the Bitcoin and altcoin ecosystem is also affected by macroeconomic factors. But what’s next technically? Analyst Rakesh Upadhyay revealed the altcoin projects and prospects to watch this week. Here are the details…
What’s up for Bitcoin now?
Bitcoin has been trading in a tight range between $19,520 and $20,576 for the past few days. This shows that there is a balance between buyers and sellers in the near term. Although the bulls are buying on the lows, they have not been able to overcome the selling at the higher highs. The falling 20-day exponential moving average ($20,863) and the relative strength index (RSI) in the negative zone point to the advantage for sellers. If the bears sink the price below $19,520, the BTC/USDT pair could drop into the strong support zone between $18,910 and $18,626.
This zone looks like it will attract strong buying by the bulls as in the previous two events. The bears will need to push the price below $17,622 to signal the resumption of the downtrend. On the other hand, buyers will need to push and sustain the price above the 20-day EMA to indicate that the bears may lose control. The pair could then rise to the 50-day simple moving average ($22,271). The price pulled back the strong support near $19,520 but the bears are trying to stop the recovery at the moving averages.
This shows that the bears are selling on every minor rally. If the bears sink the price below $19,520, the pair could resume the next leg of the downtrend. Contrary to this assumption, if the bulls push the price above the moving averages, the pair could attempt a rally to the resistance of the range at $20,576. According to the analyst, buyers will have to break through this hurdle to signal a potential trend change in the near term.
Cardano (ADA) in consolidation phase
According to the analyst, Cardano (ADA) is in consolidation but is trying to break above the moving averages. This shows that demand is at lower levels, Upadhyay says. This increases the chances of moving up. The 20-day EMA ($0.47) has flattened out and the RSI has bounced back into the positive territory, indicating that selling pressure is easing. If buyers sustain the price above the 50-day SMA ($0.50), the ADA/USDT pair could rally towards the downtrend line.
This level could act as a strong resistance again, but if the bulls break this hurdle, the pair could rally to $0.70. This positive view may be rejected in the short term if the price turns down from the current level and dips below the 20-day EMA. If this happens, the pair could slide back towards the strong support at $0.40. The 20-EMA is rising on the 4-hours chart and the RSI has moved into the overbought zone. This suggests that the bulls dominate but a minor correction or consolidation is possible in the near term.
If buyers hold the price above $0.48 or the 20-EMA, it will suggest a change in sentiment from selling on rallies to buying on dips. This could push the price towards $0.54 and then to the downtrend line. To invalidate this positive view, the bears will need to push the price below $0.48. If this happens, the pair could decline to $0.44 and then to $0.42.
Popular altcoin ATOM near resistance levels
Cosmos (ATOM) has held steady for the past few days and is trading near the overhead resistance at $13.45. This shows that traders do not close their positions because they expect the price to rise. That is why it is included in this list. The ATOM/USDT pair broke below the 50-day SMA ($11.08) on August 29, but the bulls were buying lower. This started a recovery reaching the overhead resistance at $13.45. The slowly rising moving averages and the RSI in the positive zone suggest the path of least resistance is up.
If buyers push the price above $13.45, the pair could gain momentum and rally to $15.30 and then $20. This positive view could be invalidated if the price drops sharply and drops below the psychological support at $10. The 20-EMA is rising and the bulls are buying dips to this support. This indicates a positive emotion in the short term. The bulls will try to push the price towards the overhead resistance at $13.45. This is an important level to consider. Because a breakout and a close on it may indicate that the upward movement has resumed.
Conversely, if the price breaks from the current level or overhead resistance and breaks below the 20-EMA, it indicates that the bears are active at higher levels. The pair could then remain range-bound between $10 and $13.45 for a while.
Filecoin rises sharply: how will altcoin act now?
Filecoin (FIL) was trading in a narrow range between August 27 and September 2. This situation found an upside solution on September 3. The expectation that buyers could continue with their purchases led to the selection of this coin. The FIL/USDT pair rose sharply and broke above the 20-day EMA ($6.39) on September 3. This is the first indication that buyers are trying to make a comeback. However, the bears are unlikely to capitulate easily and they are forming a strong challenge near the 50-day SMA ($6.92).
The bears pulled the price below the 20-day EMA on Sept. If they hold the price below this level, the pair could drop to $5.50. Conversely, if the price rises from the current level and rises above the 50-day SMA, it will suggest strong buying on the dips. The pair could then rally to $9 and then to $9.50. The pair has bounced back from the overhead resistance zone between $6.80 and $6.60, but a minor positive factor is that the bulls have not allowed the price to drop below the 20-EMA. If the price bounces back from the current level, the probability of a breakout and close above the zone increases.
If this happens, it will complete the double inverted head and shoulders pattern. The pair could gain momentum later and rally towards the $7.6 pattern target and then towards $8.30. This positive view may be invalidated in the short term if the price breaks and falls below the 20-EMA. The pair could later decline to strong support at $5.50.
Last altcoin on the list: EOS
EOS made the list because it managed to stay above the moving averages even in the turmoil. This indicates short-term performance and increases the likelihood of a rally if sentiment in the cryptocurrency sector improves. According to the analyst, the EOS/USDT pair completed a bottom formation on August 21, but the bulls were unable to sustain higher levels. The bears pulled the price below the breakout level on August 28, indicating strong selling on the rallies.
A minor positive factor is that buyers aggressively bought the drop to the 50-day SMA ($1.33). The 20-day EMA ($1.48) has flattened out and the RSI is near the midpoint, indicating an equilibrium between buyers and sellers. If this balance pushes and sustains the price above $1.60, the bulls could turn in their favor. The pair could then rally to the overhead resistance around $2. Alternatively, a break and close below the 50-day SMA could open the doors for a possible drop to $1.15. The bears sold the recovery around $1.60 and they are trying to push the price below the $1.46 breakout level. If they do, the pair could drop to the bullish line. This level has acted as a strong support in the previous three cases, so the bulls will try to defend it again.
If the price rebounds from the bullish line and rises above $1.60, the pair could gain momentum and rally to $1.80 and then $2. Conversely, a break and close below the uptrend line indicates that the short-term uptrend may be over. The pair could decline to $1.24 later.
