Bitcoin price hit an all-time high today and that could push certain altcoins higher.
Bitcoin (BTC) is gradually gaining ground on gold, the traditional store of value. Data shows that one ounce of gold can only buy 0.0352 Bitcoins as of February 17th, the lowest amount on the eve of BTC. This indicates that Bitcoin has been rewarding its investors much more than gold.
Bitcoin has outperformed gold significantly over various timeframes. Even if the most recent one-year data is taken into account, Bitcoin’s risk-adjusted return is 270% while gold is only 24% as of December 28, 2020.
The score skews in Bitcoin’s favor if the longer four-year or eight-year timeframes are compared.
In the past few years, Bitcoin has matured as an asset class. During the previous uptrend in 2017, Bitcoin’s 60-day volatility was at 32%. But in its current rally, Bitcoin has reported less volatility at 14.25%. Analysts believe that as institutional adoption increases, volatility may decrease further.
There are no indications of a slowdown in the number of institutions showing interest in Bitcoin. Said Elliptic co-founder Tom Robinson The Telegraph Many US financial institutions are “seriously considering launching some type of cryptocurrency service.”
If institutional adoption continues to grow, sentiment is likely to remain positive. Let’s analyze the charts of the top 10 cryptocurrencies to identify levels to the upside that could act as significant resistance.
Bitcoin / USD
The psychological level of $ 50,000 saw only slight resistance to Bitcoin, indicating that the bulls are the ones in control and not rushing to take profits as they expect the uptrend to continue.
A new all-time high above $ 51,000 is a sign of strength. The 20-day Bullish Exponential Moving Average ($ 43,451) and the Relative Strength Index (RSI) are in the overbought territory indicating bulls are in control.
If the bulls manage to keep the price above $ 50,000 for three days, the BTC / USD pair could rise to $ 60,974.43 as the bears may intervene.
On the downside, the first support is the 20 day moving average, and if the bears manage to sink the price below it, the decline might extend to the 50 day simple moving average ($ 37415). This is an important level to watch as a break below it would indicate a shift in momentum for the bears.
ETH / USD
Ether (ETH) is currently between $ 1,658,572 and $ 1,869,473. The long tail in the February 15 candlestick shows that the bulls are buying at every slight dip. Buyers will now try to push the price over $ 1,869,473.
If successful, the ETH / USD pair could initiate the next phase of the uptrend, which targets $ 2,000. This is an important resistance but if the bulls can push the price above the channel, the momentum may accelerate. Next upside target is $ 2,515.
Contrary to this assumption, if the price fails to rise above $ 1,869.473, the pair may consolidate in the range for a few more days. A break below the 20-day moving average ($ 1,658) will be the first sign of weakness and a change of direction will be signaled if the price bears sink below the channel’s support line.
DOT / USD
Polkadot (DOT) rose to an all-time high on February 16 and was followed by another new high today, indicating that the bulls are in control of the strongest. However, the bears are defending the channel’s resistance line.
If the bulls manage to push the price above the ascending channel, the momentum might pick up and the DOT / USD pair could rise up to $ 42. On the other hand, even if the price continues in the upper half of the channel, the uptrend may gradually continue.
The first sign of weakening momentum would be a break below the middle of the channel. If this happens, the pair may retreat to the channel’s support line. This is an important support level as a break below it could indicate a change in trend.
ADA / USD
After bouncing sharply from February 15th lows, Cardano (ADA) formed an internal day candlestick pattern on February 16 and a doji candlestick pattern today, indicating the balance between supply and demand.
The bulls will now try to push the price to $ 0.9817712. This level is likely to act as stiff resistance but if the bulls can push the price above it, the ADA / USD could rise to $ 1.25 and then to $ 1.50.
On the other hand, if the price falls below the current level or upper resistance, the pair may drop to $ 0.687. A rebound from this level may keep the price range limited between $ 0.687 and $ 0.981.
XRP / USD
XRP tried to bounce off $ 0.50 on February 14 and 15, as evidenced by the long tails of the candle, but the bulls were unable to sustain the bounce. This indicates that demand is drying up at higher levels.
Failure to make a strong recovery from a critical level indicates weak momentum. XRP / USD can now consolidate between $ 0.50 and $ 0.65 for a few days. A break of $ 0.65 could push the price to $ 0.78068.
Contrary to this assumption, if the price falls and breaks below the 20-day moving average ($ 0.48), the pair might drop to the 50-day simple moving average ($ 0.35).
BNB / USD
Binance coin (BNB) breached from the $ 117.7289 to $ 141.32 range it has been stuck in for the past few days. The momentum spreads today and the buyers have easily pushed the price above all-time high of $ 148.40.
The breakout to an all-time high after a shallow correction shows that traders are buying on every slight dip and not waiting for a deeper correction. The BNB / USD can now rise to $ 200.
However, traders should watch the RSI as it trades in overbought levels for the past few days. This indicates that the pair is still subject to a correction or further consolidation.
The first sign of weakness will be a break below $ 141.32 and the trend may be in the bears’ favor if it breaks the support of $ 117.7289.
LTC / USD
Litecoin (LTC) completed a successful retest of the $ 185.5821 level on February 15th, and the bulls are now trying to resume the uptrend by pushing the price and keeping it above $ 230.5305. If they manage to do so, the alt coin could go up to $ 256 then $ 272.
The bullish moving averages and the RSI in the overbought zone indicate that the bulls are in control. However, if bears defend upper resistance, LTC / USD could consolidate between $ 185 and $ 230 for a few days.
This positive outlook will be invalidated if the pair falls below $ 185.5821. Such a move would imply that supply exceeds demand. Next support on the downside is the 50 day simple moving average ($ 156).
BCH / USD
Bitcoin Cash (BCH) formed a long-legged doji candlestick pattern on February 15 and a daily internal candlestick pattern on February 16. These two formations indicate hesitation among traders about the next directional move.
If the upside uncertainty is resolved and the bulls push the price above the upper resistance zone from $ 745.39 to $ 773.32, then the Bitcoin Cash / USD pair can resume the uptrend and rise to $ 900. The bullish moving averages and the RSI in the overbought zone indicate that the path of least resistance is the upside.
On the contrary, if the price dips and dips below $ 670, the next stop might be the breakout level of $ 631.71. If this support also breaks, the decline may extend to the 20-day moving average ($ 563).
Link / USD
Chainlink (LINK) recovered sharply from its intraday lows on February 15th, but the bulls were unable to build on strength and push the price above the resistance line of the rising channel. This attracted profit taking from traders in the short term, pushing the price down to the middle of the channel.
The long tail of the candlestick today shows that bulls are buying on dips. If they manage to sustain the recovery, the price may rise again to the channel’s resistance line. A breakout above the channel could start the journey towards the next target at $ 44.
On the contrary, if the price turns back down from the resistance line, the LINK / USD may continue its journey inside the channel. Breaking down and closing down the channel will tilt the feature in favor of the bears.
XLM / USD
Stellar Lumens (XLM) also formed an indoor day candlestick pattern on February 16th, showing a hesitation between the bulls and the bears. The bulls are currently trying to push the price above $ 0.517.
If they succeed, this would indicate demand is exceeding supply and this could lead to a re-test of $ 0.600681. A break of this resistance will indicate a resumption of the bullish trend. Bullish moving averages and RSI near overbought territory indicate bulls have the upper hand.
Contrary to this assumption, if the price falls below the current level and falls below $ 0.409, this will indicate weakness and open the door to a possible drop to $ 0.35 and then to the 50 day simple moving average ($ 0.31).
Opinions and opinions expressed herein are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading movement involves risks. You must do your own research when making the decision.
Market data is provided by HitBTC exchange.