The S&P 500 and the Nasdaq Composite index posted their worst weekly performance since June as investors feared the Federal Reserve might need to continue its aggressive monetary policy to rein in inflation, which could lead to a recession in the United States.
Bitcoin (BTC) remains closely correlated to the S&P 500 and is on course to fall more than 9% this week. If this correlation continues, it could bring more pain to cryptocurrency markets, as Goldman Sachs strategist Sharon Bell has warned that aggressive rate hikes could trigger a 26% drop in the S&P 500.
The majority expects the Fed to hike rates by 75 basis points at the next meeting on September 20-21, but the FedWatch tool shows an 18% chance of a 100 basis point rate hike. base. This uncertainty could keep traders on edge, leading to increased short-term volatility.
If the Fed’s rate hike is in line with market expectations, some cryptocurrencies could attract buyers. Let’s study the charts of five short-term positive cryptocurrencies.
Bitcoin recovered from $19,320 on September 16 and broke above $20,000 on September 17, but the bulls are struggling to sustain the higher levels. This suggests that the bears are active at higher levels.
The 20-day exponential moving average ($20,432) has gradually declined and the Relative Strength Index (RSI) is in the negative zone, suggesting sentiment remains negative and traders are selling near broad resistance levels. .
If the price continues to decline and breaks below $19,320, the BTC/USDT pair could drop to $18,510. Buyers should defend this level vigorously.
On the upside, the 50-day simple moving average ($21,605) is the key level to watch. If the bulls push the price above, the pair could rally to $25,211. A breakout and close above this resistance could signal the start of a new uptrend.
The 4-hour chart shows that the sellers are trying to block the rally at the 20-EMA. This indicates that the bears are in no mood to give up their edge. If the weakness persists and the price breaks below $19,320, the pair could slide to $18,510.
Conversely, if the price rallies from the current level and breaks above the 20-EMA, the rally could extend to the 50-SMA. This level may again act as resistance, but if this hurdle is breached, the next stop could be the 61.8% Fibonacci retracement level of $21,470.
Ripple (XRP) has been stuck in a range between $0.30 and $0.39 for several days. The price has reached the range resistance and if the bulls break through this hurdle, it could signal the start of a new uptrend.
In a range, traders typically buy near support and sell near resistance. If the price drops sharply from the current level and breaks below the moving averages, this will indicate that the XRP/USDT pair might extend its consolidation for a few more days.
Although the moving averages are crossing, the RSI has moved into positive territory, indicating that the bulls have a slight advantage. If the buyers push and hold the price above $0.39, the pair could rally to $0.48.
The pair rebounded strongly from $0.32 to $0.39 indicating strong buying by the bulls. The 20-EMA has appeared and the RSI is in the positive zone, suggesting that the path of least resistance is to the upside.
If the price continues to rise and breaks above $0.39, the bullish momentum could pick up and the pair could rally to $0.41. This level may act as resistance, but if the buyers turn the $0.39 level into support, the upside could resume.
Chainlink (LINK) has been stuck in a wide range between $5.50 and $9.50 for the past few weeks, indicating that buyers are trying to bottom out. The bulls pushed the price above the moving averages and the RSI jumped into positive territory, indicating that the positive momentum may be improving.
There is minor resistance at $8.30 and if the bulls push the price above it, the LINK/USDT pair could rally to the strong resistance at $9.50. This level is likely to attract aggressive selling from the bears, but if the bulls breach the barrier, it could signal the start of a new uptrend.
The moving averages are the important support to watch on the downside, because if they give way, the selling pressure may increase. It could start a decline at $7 and then down to $6.20.
Buyers are trying to defend the moving averages on the 4-hour chart. This could start a recovery towards the overhead resistance at $8.20. If the price breaks above this general resistance, the pair could rally back to $9.
If the bulls fail to push the price above $8.20, the bears can imagine their chances and try to sink the pair below the moving averages. This can tip the advantage in favor of the bears. The pair might first drop to $7.50 and then to $7.
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The bears pulled EOS below the 50-day SMA ($1.44) on September 15, but they were unable to break the support at $1.34. This suggests that the bulls are buying lower and trying to form a bottom near $1.34.
A minor downside is that the bulls are facing strong resistance at the 20-day EMA ($1.50). This indicates that the bears have not given up and are trying to take control. This struggle between bulls and bears should resolve with a strong breakout.
If the price breaks above the 20-day EMA, the bullish momentum could pick up and the EOS/USDT pair could rally to $1.86. Alternatively, if the price declines and falls below $1.34, the pair could decline to $1.24. A break below this support could send the pair down to $1.
The recovery faltered near $1.50, indicating that the bears continue to sell on the rallies. The bears will try to consolidate their advantage further by pulling the price below the strong support of $1.34, but it may not be so easy.
The buyers have defended the $1.34 level three times and will try to do so again. If the price rebounds off $1.34, the bulls could once again attempt a rally above the broad resistance at $1.50. If they achieve this, a rally to $1.70 and later to $1.86 is possible.
Tezos (XTZ) broke below the 20-day EMA ($1.57) on September 13, but the bears were unable to pull the price towards the support line of the symmetrical triangle. This indicates that buyers are accumulating on the dips and not waiting for a deeper correction to enter. This increases the likelihood of a short-term rally.
If the price breaks above the 20-day EMA, the XTZ/USDT pair could hit the 50-day SMA ($1.66). This level has acted as strong resistance twice, so it is an important level to watch. If the bulls overcome this barrier, the pair could attempt a rally towards the resistance line of the triangle.
A break above the triangle will signal a potential trend change. The pair could then rise to $2 and later to $2.36.
Meanwhile, the bears likely have other plans. They will try to block the recovery at the moving averages. If the price declines from the current level and slides below the $1.50-$1.40 support zone, the June low at $1.20 could be revisited.
The 4-hour chart shows that the bulls defended the support at $1.50 and pushed the price above the downtrend line, but they were unable to sustain the higher levels. If the bears cause the price to drop below $1.50, the pair could drop to $1.40.
On the other hand, if the price rebounds off the $1.50 support again, it will suggest that lower levels continue to attract buyers. The bulls will then try to push the price above the moving averages and challenge the resistance at $1.62. If this level gives way, the upside could reach $1.70.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk, you should conduct your own research when making a decision.
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