The Federal Reserve raised interest rates by 75 basis points on September 21 and Fed Chair Jerome Powell expected another 125 basis points increase before the end of the year. If that happens, the benchmark rate will rise to 4.4% by the end of the year, sharply higher than the June estimate of 3.8%. The Fed has also hinted that it only expects to consider interest rate cuts in 2024.
The expectation of higher rates has pushed the two-year Treasury to 4.1%, its highest level since 2007. This may attract many investors looking for safety in this uncertain macro environment. Higher rates are also likely to reduce the attractiveness of risky assets such as stocks and cryptocurrencies and may delay the start of a new upward trend.
Daily cryptocurrency market performance. Source: Coin360
Although Bitcoin (BTC) faces several headwinds in the near term, this has not prevented MicroStrategy from buying more coins. After the last purchase of 301 Bitcoin, the company’s stock rose to 130,000 Bitcoin. This shows that MicroStrategy and its CEO, Michael Saylor, remain bullish on Bitcoin’s long-term prospects.
Bitcoin and altcoins are trying to stabilize after the Federal Reserve’s announcement. Can they begin to recover? Let’s study the charts of the top 10 cryptocurrencies to find out.
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BTC / USDT
Bitcoin dropped below the immediate support at $18,626 on September 19, but the long tail on the candlestick is showing strong buying at the lower levels. Bulls once again defended the level on September 21, which is a positive sign.
BTC/USDT daily chart. Source: TradingView
Buyers will have to push the price above the 20-week exponential moving average ($20,100) to signal that sellers may lose their grip. The BTC/USDT pair could then rise to the 50-day simple moving average (SMA) ($21,363). This level may once again act as a severe resistance but if the bulls overcome this barrier, the pair could rise to $25211.
If the price drops from the 20-day moving average, the bears will once again attempt to dump the pair below the strong support zone between $18,626 and $17,622. If they succeed, the pair could witness panic selling and could drop to $14,000.
ETH / USDT
Ether (ETH) is falling in a bearish channel pattern for the past few days. The price bounced off the channel’s support line on September 19, indicating buying on dips.
ETH/USDT daily chart. Source: TradingView
The bulls are trying to start a relief rally, which could gain strength above $1,400. If this level opens, ETH/USDT could rise to the 20-day moving average ($1,513). This level may be the real test for the bulls in the near term as a break above it could pave the way for a potential rally to the channel’s resistance line.
If the price breaks below the 20-day moving average, it will indicate that sentiment is still negative and that traders are selling on rallies. This may cause the price to drop to the channel support line. If this support fails to hold, the pair could drop to $1,000.
BNB / USDT
BNB is correcting inside the bearish channel pattern. A strong bounce off $258 is a positive sign as it indicates demand at lower levels.
BNB/USDT daily chart. Source: TradingView
The bulls will attempt to push the price above the 20-day moving average ($278) and challenge the channel’s resistance line. The 50 day simple moving average ($293) is placed just above the channel; Hence, bears are expected to defend the level aggressively.
If the price breaks down from the resistance line, the BNB/USDT pair may fall again to $258. If this support is broken, the pair may slip to the channel support line.
The bulls will have to push and hold the price above the channel to improve the odds for a rally to the strong resistance at $338.
XRP / USDT
Ripple (XRP) broke out and closed above the upper resistance at $0.41 on September 20 but the bulls were unable to build on this strength. Bears pulled the price back into the range on September 21st.
XRP/USDT daily chart. Source: TradingView
If the bulls do not give up a significant level from the current level, it will increase the possibility of a breakout above $0.41. The 20-day EMA ($0.36) started to rise and the RSI was in positive territory, indicating that the path of least resistance is to the upside. If the price breaks and continues above $0.41, the XRP/USDT pair could reach $0.46 and then $0.52.
The bears will have to sink the price below the moving averages to indicate that the pair may continue to fluctuate within the range for some time.
ADA / USDT
Buyers are trying to keep Cardano (ADA) above the rising trend line. The bulls attempted to push the price higher on September 21st, but the long wick on the candle shows that the bears are selling on intraday rallies.
ADA/USDT daily chart. Source: TradingView
If the price continues to fall and slips below the uptrend
