Bitcoin (BTC) made an excellent comeback from its March 2020 lows and this performance is being noticed by institutional investors. Recently, Rick Rieder, CIO of Fixed Income at BlackRock, said that Bitcoin could replace gold because it is “more functional than passing a bar of gold.”
Comments like these are a positive sign as they demonstrate that the narrative of Bitcoin being seen more and more as digital gold, even among mainstream investors, is gaining acceptance.
A new report from crypto investment firm Pantera Capital attributes the recent rise in the price of Bitcoin to PayPal’s new crypto service. According to Pantera, the data shows that “PayPal is already buying almost 70% of the new bitcoin supply,” and Cash App the rest 30%, which has created a real supply shortage.
Opponents of Bitcoin have long described the asset as too volatile, but research by investment management firm Van Eck found that around 51% of S&P 500 stocks are either equal or more volatile than Bitcoin. on a 90 day basis.
Findings like these could attract more investors to cryptocurrencies if the data becomes widely known.
Investors are now wondering if the price of Bitcoin hit a new high next week and if altcoins will follow suit?
Let’s study the charts of the top five cryptocurrencies to determine the path of least resistance and spot the critical levels on the up and down.
BTC / USD
Bitcoin (BTC) formed a Doji candlestick pattern on November 21 and this was resolved lower today. In a strong uptrend, corrections typically last for one to three days and then the trend resumes.
The strong rebound from today’s intraday lows suggests that buyers are piling up at every low. If the bulls can now push the price above $ 18,695.75, a rally to an all-time high is possible.
If buyers can push the price above $ 20,000, the BTC / USD pair could gain momentum and form an explosive top.
One thing to note is that the BTC / USD pair has not corrected significantly since the current stage of the rally started from the $ 10,500 level.
The price has not even retreated to the 20-day exponential moving average ($ 16,493) since October 8, suggesting there has been a rush to buy.
If the pair goes down from current levels and falls below $ 17,629, the decline could extend to the 20-day EMA. Bulls should buy closer to this support as the trend remains strong.
The Relative Strength Index (RSI) on the 4 hour chart has formed a bearish divergence, which is a negative sign. However, the failure of the bears to keep the price below the 20-EMA suggests a strong bullish build-up at lower levels.
If the bulls can keep the price above the downtrend line, a retest of the overhead resistance at $ 18,965.75 is possible.
On the other hand, if the price drops from current levels and goes below $ 17,600, the possibility of a breakout below $ 17,200 increases.
ETH / USD
Ether (ETH) regained momentum on November 20 after breaking through overhead resistance at $ 488,134. The bigger altcoin quickly covered ground and hit an intraday high of $ 561,223 today.
Bitcoin’s correction also resulted in a reserve of profits in the ETH / USD pair today, but the long tail of the candlestick shows aggressive buying at lower levels.
If the bulls can push the price above $ 561,223, the uptrend could resume with the next target target at $ 625. The upward moving averages and the RSI in the overbought zone suggest that the bulls are in control.
This bullish view will be canceled if the bears can push the price below today’s intraday low of $ 511.769. Such a move could attract aggressive selling and increase the possibility of a breakout below critical support at $ 488,134.
The 4 hour chart shows that the bulls have aggressively bought lower towards the 20-EMA. They will now try to push the price above the overhead resistance. If they are successful, the uptrend could resume.
Conversely, if the price drops from current levels or overhead resistance, bears will try to push the pair down below 20-EMA. If that happens, the drop could extend to critical support at $ 488,134.
XRP / USD
XRP jumped 40.48% on November 21. This strong rally suggests traders were panicking buying due to FOMO. However, when the underperformers start to soar, it usually suggests that the bullish phase has entered its final stage.
The psychological level of $ 0.50 attracted the profit reservation by traders today and the price came back just above the 38.2% Fibonacci retracement level at $ 0.393344. The long tail on the candlestick shows solid buys at lower levels.
If the altcoin breaks above $ 0.46, the bulls will try to resume the uptrend again by pushing the price above $ 0.50. If they are successful, the rally could expand to $ 0.60 and then to $ 0.75.
The expansion of volatility on November 21 and today has pushed the RSI deep into overbought territory. Therefore, the XRP / USD pair may enter a cooling period and consolidate for a few days before starting the next trend move.
This view will be invalidated if bears push the price below $ 0.39, as the next support is at the 50% Fibonacci retracement at $ 0.361738.
The 4-hour chart shows that the bulls are buying on lows closer to the $ 0.40 levels, but they are struggling to keep the price above $ 0.46. This suggests that traders are selling on minor rallies.
If the bulls can push the price above $ 0.46, a retest of $ 0.495663 is possible. A break above this resistance could resume the uptrend.
Conversely, if the price drops from current levels or to $ 0.46, a deeper correction in 20-EMA is possible.
LTC / USD
Litecoin (LTC) is in a strong bullish trend and the bulls had pushed the price above the overhead resistance of $ 84.3374 on November 21. However, the buyers were unable to maintain the breakout, suggesting a reservation of profits at higher levels.
Today, the bears took the price below $ 84.3374, but the long tail of the candlestick shows buying at lower levels. If the bulls can push the price back above $ 84.3374 and maintain the breakout, the LTC / USD pair could resume the bullish trend and move back up to $ 100.
However, if the bears defend the resistance at $ 84.3374, the pair could drop to the 38.2% Fibonacci retracement level at $ 72.5521. This support is just above the 20 day EMA ($ 69) therefore the bulls are likely to defend this area aggressively. The advantage will shift in favor of the bears if they can push the price down below $ 67.
The 4-hour chart shows that selling picked up after the bears dragged the price below $ 84.3374, but sellers were unable to capitalize on the breakout below 20-EMA. The pair rebounded from intraday lows and hit overhead resistance.
If the bulls can keep the price above $ 84.3374, the uptrend may resume. On the other hand, if the price drops from current levels and goes below $ 78, the pair could correct itself to the simple moving average of $ 50-75.
DASH / USD
Dash (DASH) jumped on November 21 and closed just above overhead resistance at $ 94.1813. The bulls attempted to resume the bullish movement today, but the price rose from $ 95.4549.
This suggests that the failure to keep the price above $ 94.1813 could have attracted bookings of profit from short-term traders.
The first support on the downside is the 38.2% Fibonacci retracement level of $ 82.7761. If the price bounces above this level, the bulls will try to resume the uptrend again by pushing the DASH / USD pair above $ 95.4549. The next upward target is $ 104, then $ 110.
Contrary to this assumption, if the bears cause the price to drop below $ 82.7761, a deeper correction in the 20-day EMA ($ 78) is possible.
The pair bounced off the 20-EMA on the 4-hour chart. If the rebound holds above $ 91, the bulls will try to resume the uptrend again by pushing the price above $ 95.4549.
On the other hand, if the pair drops from current levels and bears cause the price to drop below 20-EMA, the bulls will try to stop the decline at 50-SMA.
If they fail to do so, the pair could drop to the 50% Fibonacci retracement level at $ 78.8596, and if that support also cracks, then the next support is at the 61.8 retracement level. % Fibonacci of $ 74.9413.
The opinions and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move comes with risk, you should do your own research when making a decision.