Bitcoin (BTC), the entire crypto sector and the S&P 500 index are correcting on April 6, which highlights the tight correlation between the two sectors.
Despite the weakness, institutional investors do not seem to be halting their purchases, suggesting that they remain bullish in the long term. Terra used the dip to buy an additional 5,040 Bitcoin, which takes its total holdings to 35,768 Bitcoin.
Terra was not alone in this venture. MicroStrategy, the treasury with the largest Bitcoin reserves, also increased its holdings by 4,197 Bitcoin through its subsidiary MacroStrategy. After the latest purchase, the business intelligence firm holds 129,218 Bitcoin.
Another sign of a strong appetite for Bitcoin is seen in the inflows to the two Canadian Bitcoin exchange-traded funds. According to Glassnode data, the funds boosted their holdings to an all-time high of 69,052 Bitcoin, an increase of 6,594 since January.
Could Bitcoin and altcoins enter a deeper correction or will lower levels attract buying? Let’s study the charts of the top-10 cryptocurrencies to find out.
After staying in a tight range between the 200-day simple moving average (SMA) ($48,240) and $45,000 for the past few days, the bears made their move and pulled the price below the 20-day exponential moving average (EMA) ($44,567).
The relative strength index (RSI) has dipped to the midpoint and the 20-day EMA is flattening out. This suggests that the bullish momentum could be weakening. If the price rebounds off the 50-day SMA ($41,752), the bulls will again attempt to push the BTC/USDT pair above the 200-day SMA.
Conversely, if the bears sink the price below the 50-day SMA, it will signal that the pair could extend its stay inside the ascending channel. The pair could then gradually drop toward the strong support at $37,000.
The failure of the bulls to sustain the price of Ether (ETH) above the 200-day SMA ($3,487) may have resulted in profit-booking by short-term traders. That has pulled the price to the critical support at the 20-day EMA ($3,223).
If the price rebounds off the 20-day EMA, it will suggest that bulls are buying on dips. The bulls will then make another attempt to push and sustain the price above the 200-day SMA. If they succeed, the ETH/USDT pair could start its northward march toward $4,150 where the bears are expected to mount a strong defense.
Contrary to this assumption, if the bears sink the price below the 20-day EMA, the selling could pick up momentum and the pair may drop to the 50-day SMA ($2,907).
BNB once again failed to break above the 200-day SMA ($468) on April 5. The long wick on the day’s candlestick showed that the bears are defending the 200-day SMA with all their might.
The BNB/USDT pair has dipped to the 20-day EMA ($424). The bears will now attempt to sink and sustain the price below the 20-day EMA. If they succeed, the pair could extend its decline to the 50-day SMA ($398). A strong rebound off this level will suggest that the pair may remain range-bound between the 200-day and 50-day SMAs.
Conversely, if the price rebounds off the 20-day EMA, the bulls will attempt to drive the pair above the 200-day SMA and challenge the resistance at $500.
Solana’s (SOL) recovery stalled on April 2 and the price has dipped below the breakout level at $122. The bulls are expected to defend the 20-day EMA ($113) with vigor.
A strong bounce off the 20-day EMA will suggest that the sentiment remains positive and traders are buying on dips. The bulls will then attempt to push the price above the overhead hurdle at the 200-day SMA ($149).
Alternatively, a break and close below the 20-day EMA will suggest that the bullish momentum has weakened. The pair could then drop to the 50-day SMA ($96). A strong rebound off this level could keep the pair stuck between the 50-day and the 200-day SMAs.
Ripple (XRP) turned down and slipped below the 20-day EMA ($0.81) on April 5. The selling continued today and the price broke below the 50-day SMA ($0.78).
The RSI has dropped into the negative territory and the 20-day EMA has started to slope down, suggesting that bears have a slight edge. If the price sustains below the 50-day SMA, the XRP/USDT pair could drop to $0.70. This is an important level for the bulls to defend because if it gives way, the decline could extend to $0.60.
On the contrary, if the price turns up from the current level and rises above the 20-day EMA, the bulls will attempt to propel the pair above the 200-day SMA ($0.89).
The failure of the bears to propel Cardano (ADA) above the overhead resistance at $1.26 may have tempted short-term traders to book profits. That has pulled the price below the 20-day EMA ($1.09).
If the price breaks below the 20-day EMA, the pair could drop to the 50-day SMA ($0.96). The bulls are likely to defend this level aggressively but if the bears overpower them, the ADA/USDT pair could drop to the strong support at $0.74. A strong rebound off this level will suggest that the pair may consolidate between $0.74 and $1.26 for some time.
Alternatively, if the price rises from the current level, the bulls will again attempt to drive the pair above the overhead resistance. If they succeed, the ADA/USDT pair could rally to the 200-day SMA ($1.47).
Terra’s LUNA token had been in a strong uptrend but the Doji candlestick pattern on April 5 cautioned that the bullish momentum could be weakening. The negative divergence on the RSI also suggested that the bulls may be losing their grip.
The uncertainty of the Doji candlestick pattern resolved to the downside on April 6. The bears will now try and pull the price to the 20-day EMA ($102). This is an important level for the bulls to defend because a strong rebound off it will suggest that the sentiment remains bullish and traders are buying on dips.
Conversely, if the price breaks below the 20-day EMA, the selling could intensify as traders rush to the exit. That may sink the LUNA/USDT pair to the 50-day SMA ($86).
Related: Bitcoin slides below $44K in April first as trader warns ‘something is off’ with BTC
The bulls purchased the dip to the 20-day EMA ($89) on April 4 but they could not push Avalanche (AVAX) above the overhead resistance at $98. This suggests that bears continue to defend the overhead resistance aggressively.
The 20-day EMA is flattening out and the RSI has dropped into the negative zone, indicating that bears have a slight edge. If the price breaks below the 50-day SMA ($82), the AVAX/USDT pair could drop to the next major support at $65. A bounce off this level will suggest that the pair may remain range-bound between $65 and $98 for a few more days.
Conversely, if the price turns up from the current level, the bulls will make another attempt to climb above the overhead zone between $98 and $100.
Polkadot (DOT) rebounded off the 20-day EMA ($21) on April 4 but the bulls could not overcome the barrier at $23. This may have tempted short-term traders to book profits.
The DOT/USDT pair plunged below the 20-day EMA on April 6 and the RSI entered negative territory. This suggests that the bulls are losing their grip. The next stop could be the 50-day SMA ($19). The bulls are likely to defend this level with vigor but if the support cracks, the decline could extend to $16.
Alternatively, a strong rebound off the 50-day SMA could suggest that the pair may consolidate between $19 and $23 for a few days. The bulls will have to push and sustain the price above $23 to signal the start of a potential new uptrend.
Dogecoin (DOGE) soared above the overhead resistance at $0.17 on April 5 but the bulls could not clear the hurdle at the 200-day SMA ($0.18). This may have attracted profit-booking by the short-term bulls and selling by the aggressive bears, resulting in the sharp reversal on April 6.
The DOGE/USDT pair is likely to retest the 20-day EMA ($0.14). If the price rebounds off this level, it will suggest that bulls continue to buy on dips. The buyers will then again try to clear the overhead hurdle at the 200-day SMA.
This positive view will invalidate if the price continues lower and breaks below the 20-day EMA. Such a move could open the doors for a possible drop to $0.12. The pair could then remain stuck between $0.10 and $0.18 for a few more days.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk. You should conduct your own research when making a decision.
Market data is provided by HitBTC exchange.
Lazarus Group, backed by North Korea, is intensifying its phishing operations within the cryptocurrency community. This shift primarily targets users on Telegram, employing sophisticated tactics to lure unsuspecting victims.
JoyDiscovered on November 21, these vulnerabilities pose a risk to numerous smart contracts in the Web3 ecosystem, including some of Thirdweb's own pre-built smart contracts.
BrianThe glossary, co-compiled and published by ABCripto, consists of over 200 entries covering terms related to cryptocurrencies, digital assets, tokenization, and other relevant areas.
AlexEl Salvador President Nayib Bukele's recent assertion on X about the country's bitcoin investments being "in the black" faces scrutiny as discrepancies in the tracking tool he referenced come to light.
AaronCZ has argued that his surrender should be proof that he does not pose a flight risk.
AlexNetflix has recently revealed its latest cinematic offering, "Bitconned," a riveting exposé on a cybercrime saga entwined with cryptocurrency scams. The film delves into the intricacies of a dark digital underworld, emphasising the need for vigilance and awareness in the face of evolving threats.
JoyGoogle has introduced Gemini, a suite of artificial intelligence tools designed for both consumers and businesses.
AaronIt's crucial to note that 50% of the token allocation is available at genesis, with the remaining 50% unlocking gradually over 12 months, vesting from the Token Generation Date.
BrianFrom December 11, 2023, TOPPAN Holdings, Inc. and Dentsu Group, Inc. are teaming up with ODK Solutions, Inc., Sony Corporation, and several other entities to introduce a groundbreaking innovation - the Web3.0 Wallet. This digital asset storage solution incorporates photorealistic avatars to revolutionise user interaction.
JoySolana Labs' co-founder, Anatoly Yakovenko, addressed the less-than-impressive sales of the company's smartphone, Saga, in an interview with Unchained Crypto on Dec 5.
Aaron