Bitcoin plunged to $29,000 on July 24, signaling that the bears are trying to take control. It appears that the inability to hold the higher levels may have prompted the short-term bulls to take profits and the aggressive bears to initiate short positions.
Although the short-term looks bearish, long-term investors remain unfazed and continue to hold their positions. Data from Glassnode shows that the supply of long-term holders of Bitcoin (BTC) reached a new high of 14.52 million Bitcoin, “equivalent to 75% of the circulating supply”.
While cryptocurrency markets have weakened in the short term, US stock markets remain strong. The Dow Jones Industrial Average has resurrected for 10 straight days, its longest streak since 2017. However, things could change this week with a slew of reports on key results and the Federal Reserve’s July 26 policy decision. The latter could also have an impact on the US dollar index (DXY), which is on a recovery path.
Could lower levels attract Bitcoin buyers and select altcoins? Will strength in US stock markets limit the decline in cryptocurrency markets? Let’s analyze the charts to find out.
S&P 500 Index Price Analysis
The S&P 500 Index (SPX) fell from 4,578 on July 19, but a positive sign is that the bulls haven’t given much ground. This suggests that buyers are not exiting their positions as they anticipate the uptrend to continue.
The 20-day upward sloping exponential moving average (EMA) of 4,471 and the relative strength index (RSI) in overbought territory suggest that the bulls are in charge. If the price rises from 4,513 or the 20-day EMA, it will suggest that lower levels continue to attract buyers.
This will improve the outlook for a break above 4578. The index could then rally back to 4650 and possibly 4800.
This positive view will be negated if the price dips below the 20-day EMA. This could open the doors for a drop in the 50-day simple moving average (SMA) of 4,336.
US Dollar Index Price Analysis
The US Dollar Index rose sharply on July 18 and climbed back above the 100.82 breakdown level on July 20. This suggests that the breakdown below 100.82 may have been a bear trap.
The price has reached the 20-day EMA, which is an important level to watch. If the price falls sharply and dips below 99.57, the downtrend may resume. The index can then crash at 97.50.
Instead, if the price breaks above the 20-day EMA, it will suggest that the bulls are back in play. The index may then rise to the 50-day SMA (102.66) and then to the downtrend line.
bitcoin price analysis
Bitcoin bulls pushed the price above the 20-day EMA ($29,957) again on July 23, but the long wick on the candlestick shows strong selling at higher levels.
The selling intensified on July 24 and the price dipped below the strong support at $29,500 that had held for the past few days. The BTC/USDT pair has descended to the 50-day SMA ($29,021), which is a crucial level to watch.
If the price rises from the current level and breaks above the 20-Day EMA, this will suggest that the breakout may have been a bear trap. The pair could then rally to $31,000.
On the contrary, if the price continues to fall and dips below the 50-day SMA, it will suggest that the bulls have given up. The pair may then drop to $27,500 and later to $26,000.
Ether Price Analysis
Ether (ETH) bounced off the 50-day SMA ($1,852) on July 23, and the bulls tried to propel the price above the 20-day EMA ($1,888), but the bears held on.
The bears are trying to pull and hold the price below the 50-day SMA. If successful, ETH/USDT could initiate a deeper correction towards $1,700. Such a drop will indicate that the pair may remain stuck in the $1,626-$2,000 range for a while longer. Price action inside the range is likely to be random and volatile.
If the price bounces off the 50-day SMA and breaks above the 20-day EMA, it will suggest strong buying at lower levels. This could open the doors for a possible rally to $2,000. The next trend move will likely start on a break above $2000 or below $1626.
XRP Price Analysis
After failing to hold above $0.83 on July 19-20, XRP (XRP) declined towards the 20-day EMA ($0.67).
If the bulls want to keep the uptrend intact, they will need to protect the 20-day EMA with vigor. If the price bounces off this level with strength, the XRP/USDT pair could form a short-term range.
The limits of the range could be $0.66 down and $0.86 up. The first sign of strength will be a breakout and a close above the general resistance at $0.86.
Conversely, if the price breaks below the 20-day EMA, it will suggest that the bulls are rushing to the exit. This could attract further selling and the pair could crash to the $0.56 level.
BNB Price Analysis
The bulls failed to propel BNB (BNB) above the 20-day EMA ($243) over the past few days. This has attracted strong selling by the bears, who are trying to push the price down below the support of the symmetrical triangle.
If they succeed, it will suggest that the uncertainty between the bulls and bears has resolved in favor of the sellers.
The BNB/USDT pair could then fall to the critical support at $220. This level is likely to attract aggressive buying by the bulls. If the price rebounds from $220 with strength, it will suggest that the pair could stay within the range for some time.
Another possibility is that the price is bouncing off the support line of the triangle. In this case, the pair may extend its stay inside the triangle for a few more days. Buyers will need to push the price above the triangle to signal a comeback.
Cardano Price Analysis
Cardano (ADA) witnessed a tough battle between bulls and bears near the 20-day EMA ($0.31).
The flattening 20-day EMA and the RSI near the midpoint do not give a clear advantage to either buyers or sellers. This uncertainty will tip in favor of the bears if the price drops below $0.30. This could push the price down towards the uptrend line.
On the contrary, if the buyers push the price above $0.33, it will suggest that the bulls are back in play. The ADA/USDT pair could then reach the July 14 intraday high of $0.38. The bears are likely to defend this level with vigor.
Related: Share of Bitcoin Whale Exchange Inflows Hits 1-Year High – Over 40%
Dogecoin Price Analysis
The bears attempted to pull Dogecoin (DOGE) back below the $0.07 breakout level on July 22, but the bulls held firm.
The 20-day EMA ($0.07) has started to rise and the RSI is in the positive zone, indicating that the path of least resistance is on the upside. There is minor resistance at $0.08, where the bears should mount a strong defense.
If the buyers do not allow the price to slide below the 20-day EMA, the likelihood of a rally to $0.10 increases. This positive view will be invalidated in the short term if the price turns down and holds below $0.07.
Solana Price Analysis
Solana (SOL) continues to witness profit booking by short-term traders. This pulled the price below the 20-day EMA ($23.73) on July 24.
The bulls will attempt to stop the move lower at $22.30. If the price bounces off this support, the bulls will again attempt to clear the overhead hurdle at $27.12. If they can pull that off, the SOL/USDT pair could retest the July 14 high at $32.13.
On the other hand, if the price dips below $22.30, it will suggest that the break above $27.12 might have been a bullish trap. The pair could then drop to the 50-day SMA ($19.80). Such a move will suggest that the pair could continue hovering inside the wide range between $14 and $27.12 for some time to come.
Polygon Price Analysis
Polygon (MATIC) has been trading near the 20-day EMA ($0.74) for the past few days. This shows that the bulls are protecting the level, but they failed to initiate a rally. This indicates that the bears are holding their pressure.
The 20-day EMA is flattening and the RSI has fallen below 50, indicating a balance between supply and demand. This balance could tip in favor of the bears if the price drops below the 50-day SMA. The MATIC/USDT pair could then slide to $0.60.
On the contrary, if the price rises from the current level and breaks above $0.80, it will signal strong buying at lower levels. The pair can then retest the local high at $0.89. A break above this level could signal the resumption of the uptrend.
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.