The US Consumer Price Index rose to 9.1% in June, beating expectations for an 8.8% year-over-year rise. Currently, Fed Funds futures are pointing to an 81bp rate hike for July, indicating that some participants are expecting a 100bp hike.
Several indicators on the chain are pointing to a potential bottom in Bitcoin (BTC), but analysts from market intelligence firm Glassnode are not convinced that the drop has taken place. In their July 11 “The Week On-Chain” report, analysts said the market may have to drop further “to fully test investors’ resolve, and enable the market to create a resilient bottom.”
Daily cryptocurrency market performance. Source: Coin360
While the short term is still bearish, strategists are confident of its longer term prospects. Meltem Demirors, chief strategy officer at CoinShares, said on CNBC that bitcoin may extend its “downward correction” in the near term, but it will likely reach a new all-time high “in the next 24 months.”
What are the important levels in Bitcoin and the major altcoins that could stop the decline? Let’s study the charts of the top 10 cryptocurrencies to find out.
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BTC / USDT
Bitcoin dropped back to the support line of the symmetrical triangle on July 12, indicating that a break above the triangle on July 7 could be a bull trap.
BTC/USDT daily chart. Source: TradingView
Buyers are trying to defend the level but the long wick on the July 13 candlestick shows that the bears are selling near the 20-day exponential moving average ($20,796). Both the moving averages are sloping down and the relative strength index (RSI) is in the negative territory, indicating that the bears are in control.
If the price breaks below the support line, the BTC/USDT pair may drop to the $18,626 to $17,622 support area. This is an important area for the bulls to defend because if it gives way, the pair could drop to $15,000.
The first sign of strength will be a breakout and a close above the 20 day moving average. Such a move would suggest a strong buying at the lower levels. This could increase the potential for a rally to the 50-day simple moving average (SMA) ($24,084).
ETH / USDT
Ether (ETH) broke below the support line of the ascending triangle pattern on July 12th, invalidating the bullish setup. The simple positive is that the bulls are trying to push the price back into the triangle.
ETH/USDT daily chart. Source: TradingView
If they can do this, it will indicate that the breakout below the triangle may be a bear trap. The bulls will then seek to push the price back above the general resistance at $1,280. A breakout and a close above the 50-day SMA ($1,383) could boost the odds of starting a new bullish move.
Contrary to this assumption, if the price drops from the support line, this will indicate that the bears have turned the level into resistance. The sellers will then attempt to sink the ETH/USDT pair below $998 and challenge the pivotal support at $881. If this support is broken, the pair may start the next phase of the downtrend.
BNB / USDT
The bulls were unable to benefit from BNB’s breakout above the 20-day EMA ($231). This failure was exploited by the bears who sold aggressively at higher levels and pulled the price below the 20-day moving average on July 11th.
BNB/USDT daily chart. Source: TradingView
The BNB/USDT pair attempted to bounce off the strong support at $211 on July 13, but the long wick on the candlestick shows that the bears are selling near the 20-day moving average. If the price breaks below $211, the selling may intensify and the pair may slide to the vital support level at $183.
Conversely, if the price bounces back from $211 and rises above the 20-day moving average, it will indicate strong demand at lower levels. Buyers will then make another attempt to remove the upper barrier at the 50-day SMA ($253).
XRP / USDT
Ripple (XRP) fell below the support line of the symmetrical triangle on July 11th. This indicates that the uncertainty between the bulls and the bulls has been resolved to the downside.
XRP/USDT daily chart. Source: TradingView
The bulls tried to push the price into the triangle again on July 13th, but the long wick on the candle indicates that the bears are selling at the small intraday highs. If the price drops below $0.30, the XRP/USDT pair may drop to the critical support level at $0.28. A breakout and a close below this level could signal the beginning of the next phase of a downtrend.
The first sign of strength will be a breakout and a close above the 20-day moving average ($0.33). Such a move would suggest that the slide down the triangle might have been a bear trap. The pair may indicate a possible change in direction on a break above the resistance line of the triangle.
ADA / USDT
Cardano (ADA) fell below the immediate support at $0.44 on July 11, indicating that bears are in control. Selling continued and bears pulled the price