Last week we said:
Crypto markets are showing signs of resilience despite incredibly difficult conditions. With bullish divergences for all three major crypto assets, it seems the worst is over – at least for now. Many analysts are calling for $12k (or lower) BTC, but it would take some serious catalysts to push the price lower. Especially with so many investors buying and accumulating coins. HODL and BTFD conviction remains strong. Fearful conditions persist, presenting a fantastic buying opportunity.
At the time of our last article, BTC was trading around $16.4k and ETH was at $1200. It’s been a green week for the crypto market, with BTC moving up nearly 5% to $17.2k and ETH bouncing 7% to cross $1275. BNB is down slightly, falling just 3.6% over the past 7 days.
Let’s take a look at the charts and see if the uptrend will continue!
Bitcoin Price Analysis
There is some clear bullish divergence on the 4H chart. BTC’s 50SMA has crossed over the 100 – officially entering neutral territory. This is confirmed by BTC riding above both 50 and 100 SMA’s. BTC also crossed over the 200SMA resistance at $17.1k – a major breakout point if it can hold. This is the first time BTC has risen above the 200SMA since before the FTX crash in November.
On the daily chart, BTC is still sitting below its moving averages – which remain in a bearish configuration. The RSI is now sitting in a neutral range, but Stochastic is overbought. The nearest resistance is the $18.1k zone. With the stochastic being overbought, BTC will likely retrace to support levels in the medium term.
Support at the previous consolidation zone is around the $16-16.2k mark.
Ethereum Price Analysis
On ETH’s 4H chart, we can see a similar situation to BTC. The 50 and 100 SMA lines were acting as support, which confirmed on multiple retests over the past few days. Today ETH broke through the 200SMA resistance, and a golden cross opportunity is setting up for the coming week. ETH needs to hold above $1260 resistance.
On the long term ETH chart, ETH has held up very well. The RSI is approaching neutral, but Stochastic is bouncing from oversold. This indicates that an upward grind and/or sideways consolidation is likely. ETH is trading just under the 200w SMA at $1350, which is an important resistance zone.
BNB Price Analysis
BNB has been trading along its moving averages quite nicely. We can see that after last week’s pump, BNB has fallen below all three moving averages and is confirming them as resistance on this low timeframe.The closest resistance is the 50SMA, which is priced at $291. If BNB fails to break above and hold this level, it likely retraces to previous consolidation zones in the $270 range.
On BNB’s long term chart, we can see that it has held up incredibly well compared to the rest of the market and is up significantly from its summer lows. The 50SMA crossed below the 100, signaling neutral price action, and is acting as strong resistance around the $330 mark. Long term support is at the 200w SMA – which is still rising in the bear market – priced at $191. Local support is at the $260 consolidation zone.
Market Sentiment
Despite the upward move last week, investor sentiment is still at an extreme fear. This signals that it remains a good time to DCA into long term positions.
Conclusion
While the worst of the crypto winter is likely over, it will take some time for the machine to kick back into gear. Sideways consolidation and market chop is the most likely scenario for the next several months as the market recovers and normalizes. BTC and ETH have strong supports underneath them, but also strong resistance headwinds not far above. The declining hash rate signifies that miner capitulation has already occurred to some extent and is likely priced in. BTC would need to move much lower or stay in this price range for significantly longer in order to force more capitulation. The low sentiment and near-bottom prices make this a good time to build long term bags.
NFA. DYOR.
