In the past week, Bitcoin (BTC) made an attempt to break out of its range but failed to sustain higher levels, falling back inside the range and currently trading near the $26,000 mark. The price action over the past few days has formed two successive Doji candlestick patterns on the weekly chart, indicating uncertainty about the next directional move.
While it’s difficult to predict the direction of the breakout, there are expectations that the United States Securities and Exchange Commission (SEC) may approve one or more pending applications for a spot Bitcoin exchange-traded fund (ETF). Former commission chair Jay Clayton expressed confidence in a recent interview, saying that an approval is inevitable. This expectation of a potential ETF approval is likely to limit the downside for Bitcoin in the near term.
However, the lack of clarity about Bitcoin’s next trending move has had a negative impact on most major altcoins, keeping them under pressure. Only a few altcoins are showing signs of strength in the short term.
Let’s take a closer look at the charts of the top 5 cryptocurrencies that may start a rally if they break above their respective overhead resistance levels.
Bitcoin price analysis:
Bitcoin is back inside the $24,800 to $26,833 range, but the bulls continue to buy the dips, as seen from the long tail on the Sep. 1 candlestick. The downsloping moving averages indicate an advantage to bears, but the gradually recovering relative strength index (RSI) suggests that bearish momentum may be weakening.
The first sign of strength will be a break and close above the range at $26,833. If that happens, the BTC/USDT pair could retest the Aug. 29 intraday high of $28,142. On the downside, bears will have to sink and sustain the price below $24,800, which is likely to be a tough task as bulls are likely to defend the level.
Toncoin price analysis:
Toncoin (TON) is in an uptrend, but the bears are attempting to halt the up-move near the overhead resistance at $2.07. Both moving averages have turned up, indicating an advantage for buyers, but the overbought levels on the RSI suggest a minor correction or consolidation may be possible.
If the bulls remain strong and don’t give up much ground from the current level, the likelihood of a rally above $2.07 increases. The TON/USDT pair could then soar to $2.40. However, a deeper correction could pull the price to the 20-day exponential moving average (EMA) at $1.58. A strong bounce off this level would suggest a positive sentiment and that traders are buying on dips.
Chainlink price analysis:
Chainlink (LINK) has been trading inside a large range between $5.50 and $9.50 for the past several months. The bears attempted to break below the range support on June 10 but failed to sustain lower levels.
The LINK/USDT pair dropped close to the support of the range on Aug. 17, but the bulls bought the dip. Buyers are now trying to start a recovery, but they are facing resistance near the 20-day EMA at $6.24. If the price turns up from the current level and breaks above the 20-day EMA, the pair could start its journey toward the 50-day simple moving average (SMA) at $6.95.
On the other hand, if the price turns down sharply from the 20-day EMA, it will suggest that the sentiment remains negative and traders are selling on rallies. That could pull the price down to $5.50.
Maker price analysis:
Maker (MKR) has taken support near $1,000 and is attempting to resume its uptrend. The bulls are currently facing resistance at the downtrend line, but they have kept the price above the 20-day EMA at $1,107.
If the price turns up from the current level, it will indicate a positive sentiment and that traders view dips as buying opportunities. The bulls will then try to push the price to $1,370. Conversely, if the price continues lower and breaks below the 20-day EMA, it will signal that bears are fiercely defending the downtrend line. The MKR/USD pair may then slump to the strong support at $980.
Tezos price analysis:
Tezos (XTZ) has been witnessing a tussle between the bulls and bears near the strong support level at $0.70. The failure of the bears to sustain the price below this level indicates buying at lower levels. The downsloping moving averages indicate an advantage to bears, but the rising RSI suggests that bearish momentum is reducing.
A close above the 20-day EMA at $0.71 would be the first sign of strength, potentially paving the way for a rally to the downtrend line. If the bulls overcome this hurdle, the XTZ/USDT pair may start a new up-move, with potential targets at $0.94 and $1.04. However, if the price falls and sustains below $0.66, the positive view will be invalidated.
In conclusion, Bitcoin is currently within a range, with uncertainty about its next direction. The potential approval of a Bitcoin ETF by the SEC could limit downside, while altcoins face pressure in the absence of a clear trend for Bitcoin. Several altcoins, including Toncoin, Chainlink, Maker, and Tezos, are showing signs of strength and may rally if they break above their respective resistance levels.