The bears lost an opportunity this week when Bitcoin (BTC) failed to sustain below the $25,000 levels. This may have attracted buying from the bulls who are about to start a recovery in Bitcoin and select altcoins.
Additionally, BlackRock’s filing to launch a Bitcoin spot price exchange-traded fund and continued strength in the US stock market may have contributed to the improvement in cryptocurrency sentiment. Bitcoin is poised to end the week with a modest 2% gain, according to CoinGlass data, with Grayscale Bitcoin Trust institutional buying taking the discount to bitcoin spot from 44% on June 13. It was lowered to 36.6%.
Bitcoin and some altcoins are about to start a bailout rally, but the overall trend remains bearish. Therefore, short-term traders looking to buy on a bounce should consider securing profits or tightening stops if the price is struggling to break out of tight resistance.
For long-term investors who may take advantage of the drop to strong support levels to acquire their crypto of choice, the strategy may be different. A staggered buying approach is prudent as a runaway rally is unlikely.
Let’s take a look at the top 5 cryptocurrencies that are about to start a recovery in the short term.
Bitcoin price analysis
Bitcoin surged on June 15, trapping aggressive bears who may have shorted a break below $25,250. In the short term, that may have triggered a short squeeze, pushing the price to the 20-day exponential moving average ($26,403).
While the bears are trying to limit the rescue rally at the 20-day EMA, the silver lining is that the bulls are not conceding too much. This suggests that buyers are holding their positions in anticipation of a rise.
However, the bears likely have other plans as they try to offer strong resistance in the zone between the 20-day EMA and the resistance line of the descending channel. If the price drops out of this zone, the BTC/USDT pair could stay inside the channel for some time.
However, if the bulls take the price above the channel, it would suggest a possible change of trend in the short term. The pair can then surge towards $31,000.
The 20-EMA on the 4-hour chart is up and the Relative Strength Index (RSI) is in positive territory, indicating that the bulls have the upper hand in the short term. There is a small resistance at $26,850, but if crossed, the pair could reach channel resistance near $27,600. This level may be a difficult hurdle for the bulls to overcome, but if it can be overcome, a rally to $28,500 is possible.
This positive view will be invalidated in the short term if the price falls below the 20-EMA. This can drag the price down to the 50 simple moving average and eventually to the strong support zone between $25,250 and $24,800. A break below this zone is likely to intensify selling.
BNB price analysis
BNB (BNB) has been rocky for the past few days, but the silver lining is that the bulls did not allow the price to break out of the $220 support. This indicates a lower level request.
The first upside resistance is at the 38.2% Fibonacci retracement level at $252.50. If this level widens, the BNB/USDT pair could reach the 20-day EMA ($261). The bears will try to halt the recovery at this level. If successful, the pair can slide towards $220.
Conversely, if the bulls sustain the price above the 20-day EMA, it can reach the 61.8% Fibonacci retracement level of $272.50. This is an important level to defend for the bears as the pair could surge towards $305 if this level breaks.
The 4-hour chart shows that the moving averages have completed a bullish crossover and the RSI has moved up into the positive zone. This indicates that buyers are attempting a comeback. The bulls need to climb the $252.50 barrier to gain strength. After that, a rally to $265 is possible.
On the downside, initial support is at the 20-EMA. A break below this level could cause the pair to slide into the uptrend line. Breaks and closes below this level indicate that the bulls have given up. The pair could then retest the critical support at $220.
Litecoin price analysis
Litecoin (LTC) broke below a symmetrical triangle pattern on June 10, indicating that the bears have the upper hand. Sellers lowered the price below the immediate support of $75 on June 14, but failed to develop this move further.
A sharp recovery over the past few days has pushed the LTC/USDT pair above $75. This indicates strong buying at the lower levels. The bulls will next try to push the price to the 20-day EMA ($82), which is a key level to watch. If buyers clear this hurdle, the pair can move to the 50-day SMA ($86).
Contrary to this assumption, if the price breaks down from the current levels or the 20-day EMA and breaks below $70, it will signal the start of a downtrend. The first stop could be $65 and then $60.
A strong recovery has pushed the price above the 20-EMA on the 4-hour chart, suggesting that selling pressure is easing. The moving averages are on the verge of completing a bullish crossover and the RSI has jumped into positive territory, indicating that buyers are trying to come back.
There is a small resistance at $80, but if the bulls overcome this obstacle, the pair could accelerate to $85 and then to $90. If the bears want to break the rally, the price needs to sink below $75 quickly.
Related: Binance Sends Stop Notice to Fraudulent Entities in Nigeria
OKB price analysis
OKB (OKB) broke below the symmetrical triangle pattern on June 10th, signaling the beginning of a deeper correction. A small plus for the bulls is the successful defense of the $30.50 support, which indicates demand at the lower levels.
The price has reached the 20-day EMA ($42.73), which is a key level to watch. If the price turns down from the current levels, it will suggest that the sentiment remains negative and traders are selling on the rally. This could pose a serious threat to the $38.50 support. If this level breaks, the OKB/USDT pair can drop to $35 and eventually to $30.
Conversely, if buyers push the price above the 20-day EMA, it would suggest that the bears may be losing control. The pair can then move up to the support line, which could act as a strong resistance. Buyers will need to push the price above $48 to take advantage.
After a strong rally from $38.50, it is facing resistance near $42.39. A slight plus in favor of buyers is that the moving averages have completed a bullish crossover and the RSI is in positive territory.
If buyers push the price above $42.39, the pair could gain momentum and surge to $46 where the bears are expected to mount a strong defense again.
Another possibility is that the price may fall and break below the 20-EMA. This may indicate range-bound action between $38.50 and $42.39 for some time.
Quant price analysis
Quant (QNT) bounced off the $95 levels on June 16, indicating aggressive buying at the support.
However, the bears have not given up yet and are defending the downtrend line hard. Sellers will try to push the price below $95, while the bulls will try to keep the QNT/USDT pair above $95.
If the price turns up again from $95, it will increase the likelihood of a rally above the downtrend line. If so, the pair could start a strong recovery and the price could surge to $135.
This positive view may be invalidated in the short term if the price continues to fall below $95. The pair can then drop to $87 and then to $80.
The 4-hour chart shows that the pair quickly returned most of its gains, indicating that the bears are active at higher levels. They have broken the price below the 61.8% Fibonacci retracement level of $103.90, which is a negative sign.
Buyers should quickly move the price back above the moving averages if they want to challenge the downtrend line again. Alternatively, if the price breaks below his 50-SMA, a drop to $95 is more likely.
This article does not contain investment advice or recommendations. Any investment or trading move involves risk and readers should conduct their own research before making any decision.
This article is for general informational purposes and is not intended, nor should it be taken as legal or investment advice. The views, thoughts and opinions expressed herein are those of the author alone and do not necessarily reflect or represent the views or opinions of Cointelegraph.
