Bitcoin’s defense of the $38,000 level and renewed interest from institutional investors could be a sign that the bull trend is resuming.
Bitcoin (BTC) and most major altcoins are attempting to break above their respective overhead resistance levels, indicating the return of the bulls.
Data from Bybt shows that the Grayscale premium has been climbing and reached -5.88% on July 27, its closest level to zero since May 25. This suggests that institutional investors may have again started building positions via the Grayscale Bitcoin Trust.
Another institutional investment product showing a possible return of buyers is Canada’s Purpose Bitcoin ETF whose assets under management rose to 1.1 billion Canadian dollars on July 27, its highest level since May 13.
Swiss private bank Vontobel said in its half-year financial report that its Bitcoin tracker certificate investment product had generated significant interest from clients. Vontobel CEO Zeno Staub said to Bloomberg that its wealthy clients have allocated a part of their wealth to cryptocurrencies.
Horizon Kinetics co-founder Peter Doyle also told the Financial Times that the world economy is at an inflection point because of the pandemic and mounting debt. This “means either default or currency debasement.” Therefore, Doyle said people should have exposure to cryptocurrencies.
With institutional interest returning to Bitcoin, could the rally continue or will bears again stall the recovery near overhead resistance levels? Let’s study the charts of the top-10 cryptocurrencies to find out.
Bitcoin’s long wick on the July 26 candlestick shows that bears aggressively sold near $40,550 but the positive sign is that bulls flipped the $36,670 level into support on July 27. This indicates a possible change in sentiment from sell on rallies to buy on dips.
The bulls pushed the price above $40,550 today but the wick on today’s candlestick suggests that bears have not yet surrendered. They will again try to stall the recovery in the overhead resistance zone at $41,330 to $42,451.67.
If the price turns down from the current level or the overhead zone, the BTC/USDT pair could again drop to $36,670. A strong bounce off this level will suggest that bulls are not waiting for a sharper dip to get in.
The pair could then consolidate between $36,670 and $42,451.67 for the next few days, improving the prospects of a break above the range. The moving averages have completed a bullish crossover and the relative strength index (RSI) has risen into the overbought zone, indicating that bulls are back in the game.
This positive view will invalidate if the price breaks below the moving averages. That will bring the large range between $42,451.67 and $28,805 into play.
Ether (ETH) turned down from the downtrend line on July 26 but the bears could not sink and sustain the price below the moving averages. This suggests that bulls are buying on minor dips.
The moving averages are close to completing a bullish crossover and the RSI has risen into the positive zone, indicating that bulls have the upper hand. If bulls drive the price above the downtrend line, the momentum may pick up. That could open the doors for a possible rally to $3,000.
Alternatively, if the price turns down from the current level or the overhead resistance and dips below the moving averages, the ETH/USDT pair could gradually drop to the critical support at $1,728.74.
The long wick on the July 26 candlestick suggests that bears sold at higher levels. They attempted to trap the aggressive bulls by pulling Binance Coin (BNB) back below the downtrend line but the buyers did not relent.
The bulls defended the 20-day exponential moving average ($304) on July 27 and are attempting to push the price above the 50-day simple moving average ($312) today. If they succeed, the BNB/USDT pair could rise to the overhead resistance at $340.
A breakout and close above $340 will clear the path for a possible rally to $400 and then to $433. This positive view will invalidate if the price turns down from the current level or the overhead resistance and breaks below the 20-day EMA. Such a move could result in a fall to $254.52.
The long wick on Cardano’s (ADA) July 26 candlestick suggests that traders are selling on rallies. The bears tried to pull and sustain the price below the 20-day EMA ($1.25) on July 27 but failed, indicating buying at lower levels.
This may have reinvigorated the buyers who are again trying to push the price above the 50-day SMA ($1.33). If that happens, the ADA/USDT pair could gradually rise to $1.50. This level may pose a stiff challenge for buyers but if they can overcome it, the pair could start its northward journey toward $1.94.
Conversely, if the price turns down from the current level or the overhead resistance and slides below $1.20, it will indicate that bears continue to sell at every higher level. That may result in a retest of the critical support at $1.
Although bears successfully defended the 50-day SMA ($0.67) on July 26, they could not pull XRP back below the 20-day EMA ($0.62). This suggests that bulls are accumulating on dips.
Sustained buying from the bulls today has pushed the XRP/USDT pair above the 50-day SMA for the first time since May 19. If buyers can clear the hurdle at $0.75, the pair will complete a double bottom pattern. This setup has a target objective at $1.
The 20-day EMA is attempting to turn up and the RSI has risen above 62, indicating that the path of least resistance is to the upside.
Contrary to this assumption, if the price turns down from $0.75, the bears will again try to sink the price below the 20-day EMA. If they succeed, the pair may extend its consolidation between $0.50 and $0.75 for a few more days.
The long wick on Dogecoin’s (DOGE) July 26 candlestick suggests that bears are defending the 50-day SMA ($0.23) aggressively. The sellers attempted to sustain the price below the 20-day EMA ($0.20) on July 27 but failed.
This suggests that buyers have not given up and will make one more attempt to push the price above the 50-day SMA. If they manage to do that, the DOGE/USDT pair could start a relief rally that may reach $0.28 and then $0.33.
On the contrary, if the price again turns down from the 50-day SMA, several short-term traders may close their position. That could result in a break below the 20-day EMA, which may clear the path for a decline to $0.15.
The bears attempted to sink Polkadot (DOT) below the $13 support on July 27 but failed, which suggests that bulls are accumulating at lower levels.
The buyers will now try to push the price toward the overhead resistance at $16.93. This level may again act as stiff resistance but the flat 20-day EMA ($13.95) and the RSI near the midpoint suggest that sellers may be losing their grip.
If bulls do not allow the price to dip below the 20-day EMA during the next correction, the prospects of a break above $16.93 will improve. That could signal the start of a sustained relief rally to $20 and later to $26.50.
This bullish view will invalidate if the price turns down from the current level and breaks below $13. That could result in a retest of $10.37.
Uniswap (UNI) turned down from the downtrend line on July 26, indicating that bears are aggressively defending this resistance. Although the price broke below the 20-day EMA ($18.25) on July 27, the bulls bought this dip.
The buyers will now again attempt to push the price above the downtrend line. If they succeed, it will invalidate the developing bearish descending triangle pattern. The failure of a bearish setup is a bullish sign as aggressive bears are forced to cover their short positions.
That could open the doors for a possible rally to $24 and then to the critical overhead resistance at $30. Contrary to this assumption, if the price turns down and plummets below $17.24, the UNI/USDT pair could start its downward journey toward $13.
Bitcoin Cash (BCH) turned down from the 50-day SMA ($504) on July 26 but the bulls defended the 20-day EMA ($471) on July 27. This suggests a tough tussle between the bulls and the bears.
The 20-day EMA has flattened out and the RSI has risen into the positive territory, indicating that bulls are attempting to make a comeback. A breakout and close above $546.83 will signal the start of a sustained relief rally as the BCH/USDT pair will complete a double bottom pattern.
This up-move could face stiff resistance at $650.35 but if crossed, the rally could reach the pattern target at $710.13. Contrary to this assumption, if the price turns down from the current level and breaks below the 20-day EMA, the pair could extend its range-bound action for a few more days.
Litecoin (LTC) turned down from the 50-day SMA ($138) on July 26 but the positive sign is that bulls did not allow the price to dip below the 20-day EMA ($128).
The bears are likely to mount a stiff resistance in the overhead zone between the 50-day SMA and $146.54. If the price turns down from this zone and slips below the 20-day EMA, it will suggest that the range-bound action may continue for a few more days.
On the other hand, if bulls drive the price above $146.54, the LTC/USDT pair will complete a double bottom pattern. This bullish setup has a target objective of $189.25. The RSI above 57 and the flat 20-day EMA points to a marginal advantage to buyers.
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Market data is provided by HitBTC exchange.
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