Written by Rakesh Upadhyay, Cointelegraph; Compiled: Pine Snow, Golden Finance
Bitcoin had a great week, with prices rising by about 10%, reaching an important psychological level of $30,000. After the rally, the question that plagues investors is whether the uptrend will continue or will reverse.
Trading team Stockmoney Lizards recently said that Bitcoin may soon break above its resistance level and start a sharp rally. They believe that the approval of the ETF will drive mass adoption and trigger a rally ahead of the April 2024 halving.
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Cryptocurrency market data. Source: Coin360
One positive development this week is that Bitcoin’s strength has affected several altcoins that have soared above their respective upper resistance levels. This suggests that market sentiment is gradually turning positive and perhaps it’s time to consider selective buying.
Usually, cryptocurrencies that lead the market up will perform well. Cryptocurrencies that lag behind generally perform well at the end.
Let’s take a look at the chart of the top 5 cryptocurrencies that could outperform the market in the near future.
Bitcoin Price Analysis
Bitcoin witnessed a fierce battle between bulls and bears near the $30,000 mark, but a positive sign is that buyers have not given up much ground.
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BTC/USDT daily chart. Source: TradingView
Consolidation near current levels suggests that bulls are in no hurry to take profits, as they expect further higher. This could push the price up to the upper resistance zone between $31,000 and $32,400.
Conversely, if the price falls from $31,000, the BTC/USDT trading pair may fall to the 20-day exponential moving average ($28,160). If the price recovers from this level, the bulls will try again to clear the upper barrier.
If it falls below the 20-day EMA, the positive sentiment will be canceled out. This could keep the pair in the range of $31,000 to $24,800 for some time.
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BTC/USD 4-hour chart. Source: TradingView
Looking at the 4-hour chart, the pair is in an uptrend. Usually, during the rally, traders buy dips on the 20-day moving average. If this happens, it will indicate that the market sentiment remains bullish and is bought with every small decline. Subsequently, the pair may continue to rise towards $32,400.
Conversely, if the price falls below the 20-day EMA, it indicates that the trader may be in a hurry to close the position. This could open the door for a further drop to the important support level of $28,143.
Solana Price Analysis
Solsna broke above the neckline on October 19, completing a bullish reversal head and shoulders pattern. The target for this setup is $32.81.
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SOL/USDT daily chart. Source: TradingView
Overbought levels of the Relative Strength Index (RSI) indicate a possible correction. On the downside, an important support to watch is $27.12. A strong bounce from this level will indicate that the bulls have turned the level into support. This will improve the outlook for a continuation of the uptrend. Above $32.81, the rally could touch $39.
Time is running out for bear markets. If they want to stop rising, they will have to pull the price back below $27.12. The SOL/USDT trading pair may then fall to the neckline. This remains a key level to watch, as a break below it would indicate that a break above $27.12 could be a false image.
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SOL/USDT 4-hour chart. Source: TradingView
The 4-hour chart shows bulls facing strong resistance around $30. This may start a pullback and possibly reach the breakout level of $27.12. Buyers are expected to vigorously defend this level. A strong rebound at this level may indicate a return to the uptrend.
Conversely, if the price falls and falls below $27.12, it will indicate that the bears are actively selling at a higher level. The pair may then drop to the neckline near $24.50. This level may once again witness strong buying by bulls.
Chainlink Price Analysis
Since May 2022, Chainlink has been trading in a tight range between $5.50 and $9.50, indicating a balance between supply and demand.
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LINK/USDT daily chart. Source: TradingView
Bulls tried to resolve upside uncertainty by breaking the range on October 22, but long shadows on candlesticks indicate a reluctance to ease the bears. If the bulls do not give up too much position at the current level, the prospect of a rally above $9.50 will be strengthened.
Then, the LINK/USDT trading pair may start moving towards the pattern target of $13.50. Usually, a breakout of a prolonged consolidation leads to a large rally. In this case, the uptrend may extend to $15 and then to $18.
The first support on the downside is $8.50. If the bears pull the price below this level, it indicates that the range volatility is likely to continue for some time.
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LINK/USDT 4-hour chart. Source: TradingView
The pair rose sharply from $7.50, pushing the RSI deep into the overbought zone on the 4-hour chart. This indicates that the recent rally is excessive, which could lead to a pullback or consolidation.
Solid support to the downside is $8.75, then $8.50. A strong rally from the region would indicate that sentiment remains optimistic and traders are buying dips. This will increase the likelihood of retesting $9.75.
Conversely, a break below the 20-day EMA will indicate a renewed resurgence of bears. Then the trading pair may reach $7.
Aave Price Analysis
On October 21, Aave rose above the descending trend line, invalidating the bearish descending triangle structure. In general, the failure of a negative setup triggers a bullish movement.
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AAVE/USDT daily chart. Source: TradingView
Both moving averages have started to rise and the RSI is in overbought territory, indicating that the bulls are in the upper hand. If price stays above the descending trend line, the AAVE/USDT trading pair may first surge towards $88 and then rise to $95.
If the bears want to stop this rise, they will have to quickly pull the price back below the descending trend line. This may catch some aggressive bulls off guard and start making corrections to the moving averages. A break below the 50-day simple moving average ($62) will regain the dominance of the bears.
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AAVE/USDT 4-hour chart. Source: TradingView
The 4-hour chart shows that the bears are trying to stop the rebound of the downtrend line, but the bulls have not given up too much position. Momentum is gaining and the pair is moving higher towards $88.
A small issue in the short term is that the RSI has soared into the overbought zone, indicating a possible consolidation or correction. During the decline, the first support level is $72. The bears have to pull the price below the descending trend line to trap the bulls.
Stacks Price Analysis
The sharp rise in chips over the past few days indicates that bulls are trying to start a new uptrend.
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STX/USDT daily chart. Source: TradingView
A bullish crossover of the moving average indicates that the bulls have an advantage. In the short term, overbought levels of the RSI indicate a possible slight correction or consolidation. The first support level on the downside is the 20-day EMA ($0.54).
If the price bounces off this level, it will indicate a shift in sentiment from selling highs to buying dips. This will increase the likelihood of continued gains. The STX/USDT trading pair may first rise to $0.80 and then to $0.90.
If the price falls and falls below the 20-day EMA, this positive view will expire in the short term.
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STX/USDT 4-hour chart. Source: TradingView
As can be seen on the 4-hour chart, the price has been consolidating in a tight range between $0.61 and $0.65. This is a positive sign as it indicates that the bulls are not in a hurry to exit, as they expect to rise again. If a buyer pushes the price above $0.65, the pair will attempt to bounce back to $0.68 and then rise to $0.75.
Contrary to this assumption, if the price falls and falls below the 20 EMA, it indicates that the short-term trader took profits. The pair may then drop to the 50 Moving Average.
