The S&P 500 is attempting a recovery, but Bitcoin and select altcoins are struggling to break above their respective resistance levels.
Bitcoin is down about 11% in August, just shy of the 13.88% fall seen in the corresponding month in 2022, according to CoinGlass data. The picture does not look very bright for September, either. History shows that every year since 2017, Bitcoin (BTC) has declined in September.
Bloomberg Intelligence senior macro strategist Mike McGlone is even more bearish on Bitcoin. While speaking to Kitco News, McGlone warned that in case of a “global economic reset,” Bitcoin could nosedive to as low as $10,000.
Although analysts have been giving both bullish and bearish targets, it is better to wait for the price to break out of the range before taking large bets. Typically, after a low-volatility period, the volatility picks up, but it is difficult to predict the direction of the breakout with certainty.
Do Bitcoin and the major altcoins show signs of a potential breakout? What are the important levels to watch out for? Let’s analyze the charts to find out.
S&P 500 Index price analysis
The S&P 500 Index (SPX) turned down from the moving averages on Aug. 24, but the bears could not sustain the lower levels.
After the recovery on Aug. 25, the bulls maintained their buying pressure and pushed the index back to the moving averages. If buyers overcome this roadblock, the index could rally to the overhead resistance zone between 4,607 and 4,650. This zone is likely to witness a tough battle between the bulls and the bears.
If the price once again turns down from the moving averages, it will suggest that bears are fiercely defending the level. The pair may then slide to the pivotal support at 4,325. If this level breaks down, the index will complete a bearish head-and-shoulders pattern. That could start a correction toward the pattern target of 4,043.
U.S. Dollar Index price analysis
The bulls propelled the U.S. Dollar Index (DXY) above the downtrend line on Aug. 22, signaling that the correction may be over in the near term.
The bears tried to pull the price back below the level on Aug. 23, but the bulls held their ground. This suggests that the bulls successfully flipped the downtrend line into support.
The bulls will next attempt to push the price to 106. The rising 20-day exponential moving average (EMA) at 103 and the relative strength index (RSI) near the overbought territory indicate an advantage to buyers.
If bears want to make a comeback, they will have to quickly pull the price back below the downtrend line. If they do that, the index may slide to the 50-day simple moving average (SMA) of 102.
Bitcoin price analysis
The bulls and the bears are not taking large bets as Bitcoin continues to trade inside the range between $24,800 and $26,833.
The downsloping moving averages and the RSI in the oversold zone indicate that bears are in command. However, sellers may find it difficult to resume the downward move because the bulls are likely to defend the $24,800 level with vigor.
If the price rebounds off the support, it will suggest that the BTC/USDT pair may continue its consolidation for some more time. On the upside, a rally above $26,833 will be the first sign of strength. That could push the price to the 50-day SMA ($28,806) and later to $30,000.
Contrarily, a break and close below the $24,800 support could start the next leg of the downtrend to $20,000.
Ether price analysis
Ether (ETH) has been trading near the crucial support at $1,626, indicating that the bears have kept up the selling pressure.
The failure of the bulls to start a strong rebound increases the risk of a break below $1,626. If that happens, the ETH/USDT pair could plummet to $1,550. This level may attract solid buying by the bulls.
If the price turns up from this level but turns down from $1,626, it will signal that bears have flipped the level into resistance. That may start a downtrend toward $1,368. The bulls will have to kick the price above the 20-day EMA ($1,716) to signal a comeback.
BNB price analysis
BNB’s (BNB) pullback is facing selling at the breakdown level of $220, indicating that the bears are trying to flip the level into resistance.
A minor positive in favor of the bulls is that they have not given up much ground from $220. This suggests that buyers are keeping up the pressure. The bulls will have to overcome the barrier at the 20-day EMA ($223) to start a relief rally to the resistance line. This level may again witness strong selling by the bears.
The first support on the downside is $213. If this level breaks down, the BNB/USDT pair could plunge to psychological support at $200. A break below this level may extend the decline to the next major support at $183.
XRP price analysis
The failure of the bulls to push XRP (XRP) to the overhead resistance at $0.56 suggests a lack of demand at higher levels.
The weak bounce off $0.50 may attract aggressive selling by the bears. If the $0.50 support gives way, the XRP/USDT pair could drop to the crucial support at $0.41. This level could witness strong buying by the bulls. If the price rebounds off this support, it will suggest that the pair may oscillate between $0.41 and $0.56 for a few more days.
Conversely, if the price turns up and breaks above $0.56, it will suggest the start of a sustained recovery. The pair may then climb to the 50-day SMA ($0.64).
Cardano price analysis
Cardano (ADA) has been swinging inside the narrow range between $0.24 and $0.28 for the past few days. This suggests that the bulls are buying near the support and bears are selling at the resistance level.
If buyers propel the price above the overhead resistance at $0.28, the ADA/USDT pair could start a rally to the 50-day SMA ($0.29). This level may act as an obstacle, but if overcome, the pair could shoot to $0.34.
The bears are likely to have other plans. They will try to defend the overhead resistance and tug the price to the support of the range at $0.24. If this level breaks down, the pair may slump to $0.22 and eventually to $0.20.
Related: Bitcoin traders pinpoint support levels as BTC price taps $26.2K
Dogecoin price analysis
Dogecoin (DOGE) has been trading between the strong support at $0.06 and the 20-day EMA ($0.07) for the past few days.
The 20-day EMA is sloping down and the RSI is in the negative territory, indicating that the bears have the edge. Sellers will try to sink the price below $0.06 and further strengthen their position.
Time is running out for the bulls. If they want to start a recovery, they will have to quickly drive the price above the 20-day EMA. If they do that, the DOGE/USDT pair could rally to the 50-day SMA ($0.07) and thereafter jump to $0.08.
Solana price analysis
Solana (SOL) has been gradually drifting lower, indicating that the bears are pouncing on every minor relief rally.
The SOL/USDT pair could drop to the Aug. 22 intraday low of $19.35. If this level caves in, the selling could intensify and the pair may dive to $18 and eventually to the next major support at $15.60.
Contrary to this assumption, if the price turns up and breaks above $22.30, it will indicate solid buying at lower levels. The pair may first rise to the 50-day SMA ($23.61) and thereafter to the strong resistance at $26.
Polkadot price analysis
The bulls are trying to shove Polkadot (DOT) above the overhead resistance at the 20-day EMA ($4.64), but they are likely to encounter stiff resistance from the bears.
If the price turns down from the 20-day EMA, it will suggest that the sentiment remains negative and traders are selling on rallies. That could increase the likelihood of a retest of the crucial support at $4.22. If this support crumbles, the DOT/USDT pair may collapse to $4 and later to $3.88.
On the other hand, if buyers kick the price above the 20-day EMA, it will suggest the start of a stronger relief rally to the breakdown level of $5. This level could attract selling by the bears.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.
