When market sentiment turns bearish, every bit of negative news, no matter how trivial, will pull down prices as traders panic selling. This is what happened after the Chinese social media giant Weibo suspended some encryption-related accounts and raised concerns about the possibility of a wider crackdown.
Although the news may be negative in the short term, it is unlikely to change the long-term Bitcoin story. As prices adjust, some institutional investors may consider using cryptocurrency investments to hedge their investment portfolios in response to the possible surge in inflation in the United States.
From the perspective of most traders, Bitcoin’s current decline continues to represent a long-term buying opportunity.
Let’s analyze the charts of the top 5 cryptocurrencies that may outperform the market in the next few days.
Bitcoin retreated from the 20-day exponential moving average ($39,127) on June 3, but found support near the triangular trend line. This shows that bulls are buying on dips and bears are selling on rallies.
The next trend movement may start after the price leaves the triangle. If the bulls push the price to stay above the resistance line, the BTC/USDT currency pair may rebound to the 50-day simple moving average (US$47,198) and then reach the model target of US$52,622.90.
Conversely, if the price falls and breaks below the triangular trend line, it indicates that supply exceeds demand. This may lead to a fall to the support zone of USD 30,000 to USD 28,000.
If the area breaks, selling may intensify, as several traders who bought recently may exit their positions. This may bring the price down to $20,000.
The moving average on the 4-hour chart has flattened out, and the Relative Strength Index (RSI) roughly oscillated between 40 and 60, indicating that buyers and sellers are in equilibrium.
However, this state of uncertainty is unlikely to last for a long time, and the price may break or break the triangle in the next few days. If the price breaks and stays above the triangle, it indicates that the setting has acted as a reversal pattern.
Conversely, if the price falls below the triangle, it indicates that the current consolidation is a temporary stop in a strong downtrend. It is difficult to predict the direction of the breakout, so traders may wait for the breakout to occur before considering a new position.
Ether (Ethereum) Fell from the 50-day moving average ($2.908) on June 4 and re-entered a symmetrical triangle. However, the positive side is that the bulls have not given up too much, indicating strong buying near the $2,550 level.
If buyers push the price above the triangle resistance line, the ETH/USDT currency pair may challenge the 50-day moving average again. Breaking and closing above the resistance level may clear the way for a rise to the 61.8% Fibonacci retracement level of $3,362.72.
Contrary to this assumption, if the price drops from the 50-day moving average again, it indicates that the bears are actively defending the resistance level. A break below $2,550 may pull the price down to the support line of the triangle. A break of the triangle will be the first sign that the bears are back in the driver’s seat.
The 4-hour chart shows the formation of an ascending triangle pattern, which will complete on the breakout and close above $2,906. If this happens, the currency pair may rebound to 3,600 USD and then rise to the pattern target of 4,083.26 USD.
If the price falls and breaks below the triangular trend line, this bullish view will be invalidated. The bears will then try to pull the price down to $2,200 and then to a key support level of $1,728.74.
Cardano (Have) The past few days have been stuck in a wide range between $1.94 and $1. Altcoins retreated from the resistance level on June 4 and fell to the moving average.
The bulls are currently trying to defend the area between the 20-day moving average ($1.66) and the 50-day moving average ($1.55). If prices rebound from current levels, it indicates that market sentiment has turned positive and traders are buying moving averages on dips.
A breakout and close above $1.94 would indicate that the bulls have returned to dominance. If the price stays above this level, the ADA/USDT pair may retest the all-time high of $2.47. Breaking this resistance level will indicate the beginning of the next uptrend.
If the currency pair falls and breaks below the 50-day moving average, this positive view will be invalidated. The bears will then try to pull the price down to the $1.33 to $1.22 support zone.
The 4-hour chart shows the formation of an ascending triangle pattern, which will complete on breakout and close above $1.94. The target for this bullish setting is $2.88. However, it is unlikely to rush to the target directly, as the bears may form strong resistance at the current all-time high of $2.47.
The 20-EMA began to fall, and the RSI was slightly below the midpoint, indicating that it may fall to the triangular trend line. A break below this support level will invalidate the bullish setting, which may result in a drop to $1.36 and then to $1.
The bears are trying to stop Solana’s (Sol) A relief rebound at the 61.8% Fibonacci retracement level of $43.38. However, sellers failed to break the price below the 20-day moving average ($36.39), which indicates that market sentiment has turned positive.
VORTECS™ data comes from Cointelegraph Markets Pro Before the rebound momentum strengthened, the bullish outlook for SOL began to be discovered on June 1.
Cointelegraph’s unique VORTECS™ score is an algorithmic comparison of historical and current market conditions. These data points include a combination of market sentiment, trading volume, recent price changes, and Twitter activity.
As shown in the figure above, when the price approaches $32.10, the VORTECS™ score of SOL turns green on June 1.
Since then, the VORTECS™ score has remained green, and the price of SOL has risen to $43.33 today, a 35% increase in five days. This shows how VORTECS™ scores can give early signs of a counter-trend rebound, even if other instruments will be bearish.
The SOL/USDT currency pair rebounded from the 20-day moving average on June 4, and today it has rebounded from the 50-day moving average ($39.42). This shows that the bulls are not waiting for a deeper correction to buy.
If buyers push the price above $43.38, it indicates that the downtrend has ended. The currency pair may then rebound to the 78.6% retracement level of $49.97, and then rise to an all-time high of $58.38. The 20-day moving average began to rise and the RSI was in the positive zone, indicating that buyers have the upper hand.
If the price falls and breaks below the trend line, this positive view will be invalidated. The currency pair may then fall to 25.58 USD and then to 21 USD.
The moving average on the 4-hour chart has risen and the RSI is trading in the positive zone, indicating that the bulls are making a comeback. If buyers push the price above $43.38, the upward momentum may increase.
Conversely, if the price falls and breaks through the 20-EMA, it indicates an oversupply. The currency pair may fall to the 50-SMA and then to the trend line. A break below the trend line will indicate that the bears are back in the game.
THETA trades in the descending channel. The bulls tried to push the price higher and stay above the channel resistance line on June 4th and 5th, but failed. This shows that the bears are actively defending this resistance.
However, the 20-day moving average ($8.19) started to rise and the RSI was in the positive zone, indicating that the bulls have a slight advantage. If the THETA/USDT pair rebounds from the 20-day EMA, buyers will try again to push the price above the channel.
If they succeed, it indicates that the downtrend may have ended. Then the currency pair may start to rise to $13, and then rise to a historic high of $15.88. If the bears fall and maintain the price below the 20-day moving average, this bullish view will be invalidated. Such a move may cause the price to fall to $6.
The 4-hour chart shows that the currency pair has fallen from the channel resistance line twice. However, the bears failed to drop the price and maintain it below the 20-EMA, indicating that demand is at a low level.
If the currency pair rebounds from the current level, the bulls will try again to push the price above the channel. If they manage to do this, the next phase of the uptrend may begin.
On the other hand, if the price falls below the 20-EMA, the currency pair may fall to the 50-SMA. A break below this support level will indicate the beginning of a deeper correction.
The views and opinions expressed here only represent the views of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading action involves risk, and you should conduct your own research when making a decision.