The United States Federal Reserve has been aggressively hiking rates in an attempt to cool down inflation and that has kept the U.S. equities markets under pressure. Investors have been watching the inflation figures closely for early signs of topping out but to no avail.
Wholesale prices rose 0.4% in September, exceeding the Dow Jones' estimate for a 0.2% gain. This suggests that inflation is yet to respond to the Fed’s monetary tightening. All eyes will now be fixed on the Consumer Price Index data to be released on Oct. 13.
Equity traders can expect volatility to pick up following the release of the numbers but for the crypto traders, it is difficult to predict whether this trigger is sufficient for Bitcoin (BTC) to break out of the $18,500 to $24,500 range it has been stuck in for the past several days.
What are the critical levels on the upside and downside that could signal the start of a trending move in Bitcoin and altcoins? Let’s study the charts of the top 10 cryptocurrencies to find out.
Bitcoin is attempting to bounce off the first support at $18,843 but the relief rally is likely to hit a wall at the 20-day exponential moving average (EMA) ($19,482). If the price turns down from this resistance, it will suggest that bears are selling on rallies.
A break and close below $18,843 could pull the price to the $18,125 to $17,622 support zone. Bulls are expected to defend this zone with all their might because if they fail to do that, the BTC/USDT pair could resume its downtrend. The pair could then drop to $15,800 and later to $15,000.
The first sign of relief for the bulls will be a break above the downtrend line and the recovery could pick up steam after the pair rises above $20,500. That could set the stage for a possible rally to $22,800.
Ether (ETH) slipped below the symmetrical triangle on Oct. 11 but a positive sign is that the bulls purchased the dip and are trying to push the price back into the triangle on Oct. 12.
The 20-day EMA ($1,339) is sloping down and the relative strength index (RSI) is in the negative territory, indicating that bears are in control. The sellers will try to stall the recovery at the 20-day EMA.
If the price turns down from the current level or the 20-day EMA and breaks below $1,267, it will suggest the resumption of the down move. The ETH/USDT pair could then decline to the next support at $1,109.
The first sign of strength will be a break and close above the triangle. That could pave the way for a possible rally to the resistance line of the channel.
BNB formed a Doji candlestick pattern on Oct. 11, suggesting indecision among the bulls and the bears. Buyers are attempting to start a rebound from the support at $266.
The bounce is likely to face stiff resistance at the moving averages. If the price turns down from the current level or the moving averages, the BNB/USDT pair could drop to the strong support at $258. The bulls are expected to vigorously defend this level because a break and close below it could sink the pair to $216.
Another possibility is that the price turns up and breaks above the moving averages. That could clear the path for a potential rally to the stiff overhead resistance at $300.
XRP’s (XRP) failure to clear the overhead hurdle at $0.56 on Oct. 9 may have attracted profit-booking by the short-term traders. That pulled the price to the 20-day EMA ($0.47) on Oct. 11.
If the rebound fails to climb above $0.51, it will suggest that the bulls are not viewing the dip as a buying opportunity. That could increase the odds of a break below the 20-day EMA. If that happens, the selling could intensify and the XRP/USDT pair may drop to the breakout level of $0.41. The bulls are likely to forcefully defend this level.
Contrary to this assumption, if the price turns up and rises above $0.51, the bulls will again strive to drive the pair above $0.56. If they can pull it off, the pair could rally to $0.66.
Cardano (ADA) turned down sharply and broke below the critical support of $0.40 on Oct. 10. That was followed by further selling on Oct. 11, which pulled the price to $0.38. The break and close below $0.40 signal the start of the next leg of the downtrend.
Buyers have an opportunity to salvage the situation by quickly pushing the price above the breakdown level of $0.40. That could trap the aggressive bears and the ADA/USDT pair could rally to the 20-day EMA ($0.42).
Conversely, if the price turns down from $0.40, it will suggest that bears have flipped the level into resistance. That could enhance the prospects of the continuation of the downtrend toward the next major support at $0.33.
Solana (SOL) rose above the moving averages on Oct. 10 but that proved to be a bear trap. The price quickly turned down and dipped below the support at $31.65 on Oct. 11.
Buyers purchased the drop and are attempting to push the price back above the breakdown level of $31.65. If they manage to do that, the SOL/USDT pair will again rise to the moving averages. The bears may again try to stall the recovery at this level.
The downsloping moving averages and the RSI in the negative territory suggest that bears have the upper hand. A break and close below the support at $30 could increase the likelihood of a drop to the vital support at $26.
Dogecoin (DOGE) dropped close to the support line on Oct. 11. This attracted buying by the bulls as seen from the long tail on the candlestick. Buyers are trying to push the price back above the moving averages on Oct. 12.
If they succeed, the DOGE/USDT pair could rise to the overhead resistance at $0.07. This level may again act as a strong barrier but if bulls overcome it, the pair could pick up momentum and rise toward $0.09.
Alternatively, if the price turns down from the moving averages, it will show that the bears continue to sell on rallies. That could again pull the price toward the support below $0.06. If this level gives way, the pair could rest the June low near $0.05.
Related: BTC price wobbles on US PPI as Bitcoin futures open interest hits peak
Polkadot (DOT) nudged above the 20-day EMA ($6.40) on Oct. 10 but the bears sold aggressively at higher levels. That pulled the price below the immediate support at $6.25.
The bears will now attempt to sink the price to the critical level of $6. This is an important level for the bulls to defend because if the support cracks, the DOT/USDT pair could signal the resumption of the downtrend. The next support on the downside is $5.36.
The 20-day EMA remains the short-term resistance to watch out for on the upside. If bulls push the price above this obstacle, the pair could rally to the overhead zone between $6.64 and the 50-day simple moving average (SMA) ($6.79). A break above this zone could lead to a strong recovery.
Polygon (MATIC) failed to break above the downtrend line on Oct. 10, indicating that bears continue to defend the level with vigor. That may have attracted profit-booking by short-term traders, which pulled the price below the 20-day EMA ($0.80) on Oct. 11.
Buyers are trying to arrest the decline and push the price back above the moving averages. If they do that, the bulls may make one more attempt to clear the overhead hurdle at the downtrend line. The repeated retest of a resistance level tends to weaken it.
If the price breaks and sustains above the downtrend line, the MATIC/USDT pair could attempt a rally to $0.94. On the other hand, if the price turns down from the moving averages or the downtrend line, the pair could drop to $0.75 and then to $0.69.
Shiba Inu (SHIB) turned down sharply from the 20-day EMA ($0.000011) on Oct. 10 and slipped below the immediate support at $0.000010 on Oct. 11. A minor positive is that lower levels attracted buying.
The 20-day EMA is sloping down and the RSI is in the negative territory, indicating advantage to bears. The current rebound could again face strong selling at the 20-day EMA. If the price turns down from this resistance, the possibility of a break below $0.000010 increases. The SHIB/USDT pair could then start its decline toward $0.000007.
To avoid this bearish view, buyers will have to push and sustain the price above the moving averages. That could open the doors for a possible rise to $0.000014.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph.com. Every investment and trading move involves risk, you should conduct your own research when making a decision.