Last week we said:
From a technical perspective, bullish divergences are beginning to form on low-timeframes for all three major cryptos. The market seems to have officially switched from bearish to neutral, and sentiment has yet to catch up. On the daily chart, all three cryptos are at an inflection point as they attempt to break above local resistances. Weekly charts remain intact – especially for ETH and BNB – and look primed to consolidate sideways for several weeks to come.
The crypto markets broke through local resistance levels and pumped to the highest point in several weeks before forming a new consolidation pattern in this new range. From a long term perspective, the market remains in a sideways consolidation range despite the upward price movement. Today we will be analyzing BTC, ETH and AVAX. Will the pump continue?
Let’s take a look at the charts and find out!
Bitcoin Price Analysis
BTC’s 4H moving averages are in a bullish configuration for the first time in months. Currently, the price is in the midst of a pullback that has touched the 50SMA as support. This support is at $20,250. If this support holds, BTC may bounce back into the $20.7k zone for continued consolidation. Below this, the 100 and 200SMA’s will act as support in the 19.6-7k zone.
BTC’s daily moving averages remain bearish, but there is bullish divergence here as the price has crossed the 50SMA resistance and moved up to the 100SMA resistance at $20.8k. Upon the first test, BTC is rejecting off of this resistance. Support at the 50SMA is priced at $19.6k, which coincides with identified support on lower timeframes.
BTC continues to range beneath the weekly 200SMA. This level is a key resistance at $23.9k. BTC will need to break above $24k and hold above the 200SMA in order to truly gain bullish momentum.
Ethereum Price Analysis
ETH’s moving averages are also firmly back in a bullish position. This pullback has not touched the 50SMA as ETH has outperformed BTC over the past week significantly. 50SMA support is priced at $1.5k. Lower supports are at $1.35k – 1.4k.
ETH has actually moved up to test the 200SMA on the daily chart and is currently retracing to the 100SMA to confirm support at $1.5k. If this level holds, it is likely that ETH will retest the 200SMA resistance near $1.7k. The most likely scenario here is that ETH consolidates in this zone before confirming a direction.
ETH has held above its 200w SMA nicely throughout the bear market, confirming it as support on multiple occasions. This support level is currently sitting just above $1.3k. Long term resistance is sitting near $2k – this was the high set in August.
AVAX Price Analysis
AVAX’s moving averages are still in a neutral position on the 4H chart, but there is clear bullish divergence as its price has rocketed through resistance zones. Current resistance on this time frame is around $20, while support at the 50SMA is priced at $17.
On the daily chart, AVAX has become heavily overbought according to momentum indicators. This means that a pullback to support zones is highly likely. The nearest support is the daily 50SMA priced at $17, which coincides with support identified on the 4H timeframe.
Market Sentiment
Investor sentiment has moved out of the “Extreme fear” category. Though still fearful, it is best to accumulate when fear is at an extreme. This is still bullish for crypto markets, as fear has already been priced in.
Conclusion
Markets have rallied away from their lows, and bullish divergences are beginning to form on low and medium timeframe charts. BTC and ETH may be hitting resistance on daily charts, but supports are converging across timeframes. The most likely scenario is a short-term pullback to support and a continued consolidation in this new higher range to regather momentum.
NFA. DYOR.
