The strength in the S&P 500 and weakness in the U.S. Dollar Index could limit the short-term downside in Bitcoin and select altcoins.
The S&P 500 Index (SPX) has gained for five consecutive weeks, the first such instance since November 2021. In comparison, Bitcoin (BTC) is trading well below its local high of $31,000, made on April 14. This shows a clear divergence between the performance of the two asset classes.
Some analysts expect Bitcoin’s range-bound action to continue for some more time. Cryptocurrency traders will be looking for some positive triggers that could push the price above the range. One such rumor floating in the markets is that after BlackRock filed for a Bitcoin spot exchange-traded fund, Fidelity Investments may also follow suit. If that happens, it will be a positive sign for the markets.
Another positive for the cryptocurrency markets has been that the U.S. Dollar Index (DXY) softened in the past week. Historically, the dollar and Bitcoin have an inverse correlation, which may help limit the downside in Bitcoin and launch a relief rally.
Let’s look at the important resistance levels that need to be crossed to start a sustained recovery in Bitcoin and the major altcoins.
S&P 500 Index price analysis
The S&P 500 Index is in a short-term uptrend. The rally of the past few days pushed the relative strength index (RSI) into the overbought territory, indicating that a minor correction or consolidation is possible.
The index could turn down and retest the breakout level of 4,325. If the price rebounds off this level, it will suggest that buyers have flipped 4,325 into support. That will enhance the prospects of a rally to 4,500 and thereafter to 4,650.
Contrary to this assumption, if the price turns down and breaks below the 20-day exponential moving average (EMA) of 4,283, it will suggest that the bullish momentum is weakening. That could pull the index to the 50-day simple moving average (SMA) of 4,180. Below this level, the advantage may tilt in favor of the bears.
U.S. Dollar Index price analysis
The failure of the bulls to sustain the U.S. Dollar Index back above the 20-day EMA (103) on June 12 accelerated selling. That pulled the index back below the 50-day SMA (102) on June 15.
The 20-day EMA has started to turn down and the RSI is in negative territory, indicating that bears have the upper hand. Sellers will try to sink the price to the crucial support at 100.82. A break and close below this level will signal the resumption of the downtrend.
Contrarily, if buyers quickly push the price back above the moving averages, it will suggest that the index could rise to the downtrend line. Buyers will have to drive the price above this level to open the gates for a possible rally to 106.
Bitcoin price analysis
Bitcoin has been correcting inside the descending channel pattern for the past several weeks.
The 20-day EMA ($26,389) is flattening out and the RSI has climbed to the midpoint, indicating that the selling pressure could be reducing. Buyers will try to push the price to the resistance line of the channel. This is an important level for the bears to defend because a break and close above it could start a new up move.
Alternatively, if the price turns down sharply from the current level, it will suggest that bears continue to sell on rallies. The BTC/USDT pair could then retest the strong support zone between $25,250 and $24,800.
Ether price analysis
Ether’s (ETH) attempt to start a recovery is facing selling at the 20-day EMA ($1,766), but a minor positive is that the bulls have not allowed the price to slip back below $1,700.
If the price turns up from $1,700, the ETH/USDT pair will again attempt to rally above the 20-day EMA. If that happens, it will suggest that the short-term corrective phase may be over. The pair may first rise to $1,928 and subsequently to $2,000.
Contrarily, if the price turns down from the current level and breaks below $1,700, it will indicate that bears remain in command. There is minor support at $1,600, but if this level gets taken out, the pair may plunge to $1,352.
BNB price analysis
BNB’s (BNB) relief rally is facing selling at the 38.2% Fibonacci retracement level of $252.50, but a positive sign is that the bulls have not given up much ground.
The bulls will again try to thrust the price above the overhead resistance zone between $252.50 and the 20-day EMA ($259). If they can pull it off, the BNB/USDT pair may climb to the 61.8% retracement level of $272.50. The bears are expected to fiercely protect this level.
Contrary to this assumption, if the price turns down from the current level or the overhead resistance, it will suggest that the bears are not ready to give up their hold. The pair could then once again drop to the critical support at $220.
XRP price analysis
The bears repeatedly pulled XRP (XRP) below the 50-day SMA ($0.47) between June 14 and 17, but they could not sustain the lower levels. This suggests buying on dips.
The bulls are trying to push the price above the 20-day EMA ($0.49). If they achieve that, it will indicate that the XRP/USDT pair may swing between the 50-day SMA and $0.56 for some more time. The flattening 20-day EMA and the RSI near 50 also point to a possible consolidation in the short term.
If bears want to remain on top, they will have to quickly tug the price below $0.45. That could accelerate selling and sink the pair to $0.41.
Cardano price analysis
The bulls are struggling to start a relief rally in Cardano (ADA) even though the RSI is at deeply oversold levels.
The bears are trying to sink the price to the vital support at $0.24. This is important support to keep an eye on because if it cracks, the ADA/USDT pair may skid to $0.22 and then extend the decline to $0.20.
Buyers are likely to have other plans. They will try to guard the zone between $0.24 and $0.22 with vigor. If the price turns up from this zone, it will suggest that the pair may consolidate between $0.24 and $0.30 for a while. The first sign of strength will be a break and close above the 20-day EMA ($0.30).
Related: Why is Cardano price down today?
Dogecoin price analysis
Dogecoin (DOGE) has been trading inside a tight range between the 20-day EMA ($0.06) and the horizontal support at $0.06 for the past few days.
The failure of the DOGE/USDT pair to rise above the 20-day EMA suggests that the sentiment remains negative and the bears are selling on every minor rally. That increases the risk of a break below the vital support at $0.06. If this level gives way, the pair may collapse to $0.05.
On the upside, the 20-day EMA remains the key hurdle for the bulls to cross. If they sustain the price above this resistance, the pair could rally to $0.08. This level may pose a strong challenge to the bulls.
Solana price analysis
Solana (SOL) is witnessing a tough battle near the $15.28 level. Buyers pushed the price above this level, but they have not been able to overcome the barrier at $16.18.
The bears are trying to sink the price below $15.28. If they do that, the SOL/USDT pair could slide to $14.06 and later to the support at $12.80. This is an important level to watch out for because if it breaks down, the pair may tumble to $10.
The first sign of strength will be a break above the zone between $16.18 and the 20-day EMA ($17.03). That could clear the path for a potential retest of the breakdown level of $18.70. This level is likely to attract strong selling by the bears.
Litecoin price analysis
The bulls are trying to keep Litecoin (LTC) above the immediate support at $75, which suggests that lower levels are being bought.
The bulls will try to push the price to the overhead resistance at the 20-day EMA ($81). This level is likely to witness strong selling by the bears, as they will try to maintain their control. If the price turns down from the current level or the 20-day EMA, it will open the doors for a possible retest of the support zone between $75 and $70.
Contrary to this assumption, if bulls shove the price above the 20-day EMA, it will indicate that the bears may be losing their grip. The LTC/USDT pair could then rally to $90.
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.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.
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