The crisis of Terra’s stablecoin TerraUSD (UST) and the free fall of Terra’s LUNA token further dampened cryptocurrency sentiment. Although Terraform Labs CEO Do Kwon announced a relief program, the community doesn’t seem to have much hope for a revival.
Another impediment to the rapid improvement in sentiment was the U.S. consumer price index, which surged 8.3% from a year ago, beating expectations for a 0.2% rise. While the figure was slightly lower than March’s 8.5% reading, the slow deceleration suggests that further Fed tightening has not eased.
As scary as the screen looks during the capitulation, it also provides one of the best times to go against the herd and accumulate a fundamentally strong cryptocurrency on the cheap. Instead of rushing to grab a falling knife, traders should wait for prices to stabilize and the capitulation to end before buying in stages.
What are the key levels for Bitcoin (BTC) and major altcoins that could attract buyers? What are the key resistance levels on the upside that could signal a potential trend change? Let’s study the chart of the top 10 cryptocurrencies to find out.
Bitcoin fell sharply on May 9 and attempted to recover from the psychological $30,000 level on May 10. The long wicks on the day’s candlesticks suggest that bears are reluctant to ease, and they continue to sell in a small rally.
The bears attempted to consolidate their advantage on May 11, but the bulls are fully defending the key $28,805 level. This is an important level to watch because if it breaks, the sell-off could intensify. Then, the BTC/USDT pair could slide to $25,000 and then to $20,000.
While the downward sloping moving averages are pointing in favor of the sellers, the relative strength index (RSI) in the oversold territory suggests a possible relief rally or consolidation.
If the price rises from current levels, it could reach the 20-day exponential moving average (EMA) ($36,214). This is an important level to watch as the bears will once again attempt to sink the pair below $28,805 if the price turns down.
Alternatively, if the bulls push the price above the 20-day EMA, the pair could rally to the 50-day simple moving average (SMA) ($40,792).
Ether (ETH) has reached strong support at $2,159. The bulls are likely to build a strong defense at this level as the sell-off could gain momentum if the support breaks.
If the rally persists, the bulls will try to push the price above the 20-day EMA ($2,698). During a downtrend, the bears will usually try to prevent a rebound from the 20-day EMA; thus, this becomes an important level to watch out for.
If the price turns down from the 20-day EMA, it will indicate that market sentiment remains negative and traders continue to sell on rallies. The bears will then make another attempt to sink the ETH/USDT pair below $2,159. If they succeed, the pair could plummet to $2,000 and then to $1,700.
BNB experienced a sharp decline on May 9 and fell below the strong support at $320. The bulls are attempting to push the price back above the May 10 breakdown level, but the bears are not relenting.
The bears resumed their selling on May 11 and dragged the BNB/USDT pair below immediate support at $289. If the sellers sustain the price below $289, the pair will pick up momentum and plummet to $250 and later to $225. Buyers are expected to mount a strong defense at this support area.
Alternatively, if the price rises from current levels, the bulls will make another attempt to push and sustain the pair above $320. If they are successful, it will show that the market has rejected lower levels. The pair could then rise to $350.
Ripple (XRP) is witnessing a fierce battle between bulls and bears near $0.50. Although the bears pulled the price below $0.50 on May 9, the bulls reclaimed that level on May 10.
The bears finally overcame the bulls on May 11 and resumed the downtrend. The XRP/USDT pair fell to strong support at $0.40 as the bulls tried to stem the decline.
If the price rises from current levels, the bulls will make another attempt to push the pair above the overhead resistance zone between $0.50 and $0.55. Conversely, if the price breaks below $0.40, the pair is likely to sell off further and drop to $0.34.
Cardano (ADA) broke below strong support at $0.74 on May 9, signaling that the downtrend has resumed. Buyers attempted a recovery on May 10 but were unable to hold onto higher levels.
Selling resumed on May 11, with ADA/USDT falling below immediate support at $0.58. If the price sustains below this level, the pair could fall to the psychological level of $0.50 and then to $0.40.
Conversely, if the price rises from current levels, the bulls will try to push the pair back above the breakout level of $0.74 and the 20-day EMA ($0.77). If they are successful, the recovery could gain momentum and the pair could rally towards key resistance at $1.
Solana (SOL) fell on May 9 and closed below strong support at $75. This marks the start of the next downtrend. The bulls attempted to trap aggressive bears by pushing the price back above the sub-$75 level on May 10, but the bears held their ground.
The sell-off resumed on May 11, with the bears pulling the price below psychological support at $50. If the price sustains below $50, the SOL/USDT pair is likely to extend losses to $44 and then to $40.
Conversely, if the price rises from current levels, the bulls will make another attempt to push the price above $75. If they manage to do so, the pair could rally to the 20-day EMA ($83).
This is an important level to watch, as a breakout and close could signal that the bulls are back in the game. The pair could then rally to the 50-day SMA ($101).
Dogecoin (DOGE) fell below the $0.12 support on May 9 and plummeted to the psychological $0.10 level. Buyers attempted to start a recovery on May 10, but hit a wall at the $0.12 breakdown level.
The bears continued to sell and drag the price below the key May 11 support at $0.10. If the price sustains below $0.10, the DOGE/USDT pair is likely to extend the decline to a strong support area between $0.06 and $0.04. The bulls are likely to vigorously defend this support area.
If the bulls quickly push the price back above $0.10, it will indicate strong accumulation at lower levels. Buyers will then try to push the pair above the 20-day EMA ($0.12). If they are successful, it will show that the bears may be spinning out of control.
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Polkadot (DOT) fell to psychological support at $10 on May 9 and attempted to recover on May 10, but the long wick on the candlestick on the day showed selling at higher levels.
Selling resumed on May 11, with bears pulling prices below strong support at $10. If the bears sustain the decline, it will indicate the start of the next downtrend. The DOT/USDT pair is likely to extend losses to $7.
Conversely, if the price recovers from current levels and rises above $10, it will indicate strong buying at lower levels. If the bulls sustain the price above $10, the chances of a rally to $14 increase.
Avalanche (AVAX) broke below key support at $51 on May 9, signaling that the downtrend has resumed. Buyers attempted to push the price back above the May 10 breakdown level, but the long wick on the candlestick showed that the bears turned the $51 level into resistance.
The AVAX/USDT pair resumed its decline on May 11 and broke below the key support level at $32, but the long tail on the candlestick indicated strong buying at lower levels. The bulls are expected to aggressively defend the $32 level as the sell-off could intensify if the support gives way and the pair could drop to $18.
If the price rises from current levels, buyers will make another attempt to push the pair above the $51 breakdown level. A breakout and close above this level could be the first sign that the downtrend may be fading.
Shiba Inu (SHIB) has been gradually declining for the past few days. Momentum picked up on May 9 and the price fell below the key support at $0.000017. This marks the resumption of the downtrend.
Buyers bought near $0.000013 and pushed the price back above the $0.000017 breakdown level on May 10. However, the long wick on the candlestick on the day suggests that the bears are selling higher and attempting to turn $0.000017 into resistance.
If the price sustains below $0.000013, selling could intensify and the SHIB/USDT pair could drop to the psychological level of $0.000010. Buyers will have to push and sustain the price above the 20-day EMA ($0.000020) to signal that selling pressure may be fading.
The views and opinions expressed here are those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading action involves risk. You should do your own research when making a decision.
Market data is provided by the HitBTC exchange.