Latest Market Overview 26th Jan: BTC, ETH, BNB, SOL, XRP, ADA, AVAX, DOGE, DOT, LINK
Thanks to robust spot Market activity, Bitcoin’s (BTC) price has surged to $42,000. The recent dip below the $40,000 support level on January 22 didn’t hold for long, and the price has climbed back above $40,000. However, there are concerns among some analysts that the downward trend may persist. Chris Burniske, a partner at Placeholder, a crypto venture capital firm, expressed his belief on X (formerly Twitter) that Bitcoin could drop to the mid-to-high $20,000 range before finding a bottom.
One significant factor contributing to Bitcoin’s recent decline has been the substantial liquidations in the Grayscale Bitcoin Trust (GBTC). Nevertheless, JPMorgan analysts, in a market report dated January 25, suggested that most of the profit-taking in GBTC has already occurred, implying that the primary downward pressure on Bitcoin from this source should be mainly in the past.
Every bull market has its share of corrections, which helps shake out the weak hands and allow stronger ones to buy at lower levels. During a correction, waiting for a support level to be established before buying is generally a good strategy.
What are the essential support levels in Bitcoin and altcoins that may hold? Let’s analyze the charts of the top 10 cryptocurrencies to find out.
Bitcoin (BTC) market analysis
The bulls purchased Bitcoin’s dip near $37,980 on January 23, pushing the price to the 20-day exponential moving average ($41,904) on January 26.
The BTC/USDT pair will likely face a stiff battle between the bulls and the bears near the moving averages. If the pair ascends the 50-day simple moving average ($42,904), the next stop could be $44,700. The bulls may again face stiff opposition from the bears at this level.
If the price turns down from the current level or the overhead resistance, the pair may remain range-bound between $44,700 and $37,980. A slide below the $37,980 could start the downward move to $34,800.
Ether (ETH) market analysis
The long tail on Ether’s January 25 strategy shows that the bulls are trying to protect the nearby support at $2,168.
The ETH/USDT pair will attempt to pull back to the downtrend line, which is likely to act as a stiff barrier. If the price turns down from the overhead resistance, it will signal that the sentiment remains negative and traders are selling on rallies. That could enhance the prospects of a drop to $2,100. Buyers are expected to defend the level fiercely.
Conversely, a rise above the moving averages will be the first indication that the selling pressure is reducing. The bullish momentum may pick up on a rally above $2,400.
BNB market analysis
BNB has bounced off the strong support at $288, indicating that the bulls are aggressively buying at this level.
The 20-day EMA ($304) is flattening out, and the RSI is near the midpoint, indicating a balance between supply and demand. If the price rises above the 20-day EMA, the BNB/USDT pair could rise to the downtrend line. This is the key level to watch out for because a break above it could drive the pair to $338.
Instead, if the price turns down from the 20-day EMA or the downtrend line, it will suggest that the pair may remain inside the descending triangle pattern for a few more days. A break below $288 will complete the bearish setup, with a target objective of $238.
Solana (SOL) market analysis
The bears pulled Solana below the 61.8% Fibonacci retracement level of $87 on January 22 but could not capitalize on this strength.
The bulls have pulled the price toward the moving averages, which will likely act as a stiff resistance. But if buyers shove the price above the downtrend line, it will suggest that the corrective phase may be over. The SOL/USDT pair could rise to $107 and attempt a rally to $117 after that.
Instead, if the price turns down from the downtrend line, it will signal that the bears hold the edge. Sellers will have to sink the price below $79 to open the doors for a possible drop to $64.
XRP market analysis
The bulls are trying to arrest XRP’s decline to $0.50, but the weak recovery suggests a lack of demand at higher levels.
Both moving averages are sloping down, and the RSI is near the oversold zone, indicating that the bears are in the driver’s seat. If the price turns down from the 20-day EMA ($0.55), sellers will try to tug the price below $0.50 and challenge the next support at $0.46.
On the upside, a rise above the 20-day EMA will be the first sign that the bears are losing their grip. The XRP/USDT pair will then try to climb to the downtrend line, where the bulls will likely face stiff resistance from the bears.
Cardano (ADA) market analysis
For Cardano: The bulls bounced off the support line of the descending channel pattern on January 23. After a brief hesitation, they are trying to extend the relief rally to the 20-day EMA ($0.51) on January 26.
The downsloping 20-day EMA and the RSI in the negative zone indicate that the bears have the upper hand. They will try to halt the rally at the 20-day EMA. If they manage to do that, the ADA/USDT pair may retest the channel’s support line. If this level allows, the selling could intensify, and the pair may plummet to the next support at $0.35.
Bulls must drive the price above the 20-day EMA if they want to prevent the downside. If they do that, the pair will likely climb to the downtrend line, where the bears are expected to mount a strong defence.
Avalanche (AVAX) market analysis
The recovery will likely hit a wall at the 20-day EMA ($33.81), which is sloping down. If the price turns sharply from the 20-day EMA, it will suggest that the sentiment remains negative and that traders are selling on rallies. The AVAX/USDT pair may then retest the low at $27.24. A break below this level could risk a drop to $24.
Instead, if bulls drive the price above the 20-day EMA, it will suggest strong demand at lower levels. The pair could then climb to the overhead resistance at $38.
Dogecoin (DOGE) market analysis
Dogecoin has been facing selling at the downtrend line, but the bears have not been able to sink the price below the $0.07 support.
The bulls will again try to defend the $0.07 level with vigour. If the price rebounds off $0.07, the DOGE/USDT pair could climb to the downtrend line. Buyers must overcome this barrier to indicate that the correction may be over. The pair could then attempt a rally to the $0.10 to $0.11 resistance zone.
Meanwhile, the bears are likely to have other plans. They will try to yank the price below the strong support of $0.07. If they do that, the pair could move downward to $0.06.
Polkadot (DOT) market analysis
Polkadot completed a head-and-shoulders pattern with a close below the neckline on January 22. The bears tried to start a down move, but the bulls purchased the dip on January 23, and the price recovered to the pattern’s neckline.
If the price climbs back above the neckline, it will suggest that lower levels are attracting solid buying by the bulls. The 20-day is likely a substantial hurdle, but if the bulls overcome it, the DOT/USDT pair may pick up momentum and climb to $8.50.
Contrarily, if the price turns down from the neckline or the 20-day EMA, it will suggest that the bears are active at higher levels. A drop below $5.97 could start the next leg of the downtrend to $4.80.
Chainlink (LINK) market analysis
It is difficult to predict the direction of the breakout of a range with certainty. Hence, waiting for the breakout to happen is better before taking directional bets. Until then, traders generally bought the dips to the support and sold near the range’s resistance.
The price may dip to $12.85, where buying will likely pick up. A break above the moving averages will increase the likelihood of a rally to $17.32. This view will be invalidated if the LINK/USDT pair turns down sharply and plunges below $12.85. That will signal the start of a downward move to $10.50.
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