Corrections when the market is in an uptrend are often backed by strong buying. Investors tend to buy at the bottom price because they think the uptrend will start again. Therefore, corrections in the bull market do not get too deep.
On the other hand, if the trend is down, traders prefer to sell on every small rally because they believe lower levels are coming. As a result, support levels are easily broken in a bear market and the price continues to decline.
Downtrends following the strong bull market continue as long as buyers keep their hopes up. However, if hope runs out, the asset price hits bottom.
In the current price volatility, traders should pay attention to the foundations of cryptocurrencies and their long-term goals. It is necessary to put aside panic and make a conscious decision in the medium and long term.
Although red is dominant in the market, there are cryptocurrencies that are likely to experience a relief rally in the next few days. Cointelegraph analyst Rakesh Upadhyay did technical analysis and price evaluation for 5 cryptocurrencies that are likely to make a bullish move during the week.
BTC / USDT – Bitcoin teknik analytics
Bitcoin (BTC) price fell below the 200-day simple moving average (SMA) ($ 40,348) on May 19 and saw a close there. Institutional investors watch this indicator closely and generally avoid buying if the price stays below it for a long time.
Daily chart of BTC/USDT pair. Source: TradingView
Buyers pushed the price above the 200-SMA on May 20, but it did not continue. In other words, bears increase sales on up rallies. The BTC/USDT pair is now in danger of falling to $28,850. This is an important support, because if it breaks, sales could take up to $20,000.
The 50-day SMA ($53,098) and the relative strength index (RSI) in the oversold zone at 28 are giving the bears an advantage.
If the price bounces above the $ 28,850 support, the bulls will make another attempt to push the price above the 200-SMA. If they are successful, the pair may rise again to the neckline of the head-to-shoulder pattern.
ETH / USDT – Ethereum price analysis
Ether (ETH) price declined below the 50-day simple moving average (SMA) ($2,784) on May 19. The bulls tried to push and maintain the price above the 50-day SMA on May 20 and 21, but they failed. In other words, selling pressure increases in the upward rallies.
Daily chart of ETH/USDT pair. Source: TradingView
Although the price started the day above $2,100, a drop below $1,800 could set the stage for a drop to the 200-SMA ($1,588) level for ETH/USDT. This level is likely to serve as a strong support. Should the price rebound, the pair will rise to the 50-SMA line, where the bears will once again face stiff resistance.
If the price drops from the 50-SMA, the pair could move range-bound for a few days. Contrary to this assumption, if the bears pull the price below the 200-SMA, this time panic could begin and the pair could drop as low as $1,289.
The 50-day SMA is flat while the relative strength index (RSI) is falling into the oversold territory. This suggests that the short-term trend is bearish, but the medium-term trend is neutral.
ADA/USDT – Cardano analysis technique
Cardano (ADA) price bounced back from the $0.95 level on May 19 and the bulls continued the May 20 relief rally for a while. However, higher levels led to profit buying and the price dropped below the $1.48 support on May 22.
Daily chart of ADA/USDT parity. Source: TradingView
It is likely that the $ 1 to $ 0.95 level will serve as a strong support in this period. If the price bounces off this support, the ADA/USDT pair could rise to $1.48 again. The sideways 50-day simple moving average (SMA) ($1.45) indicates that the price may move sideways for a while.
Contrary to this assumption, if the price drops below the support zone, the pair could drop to the 200-day SMA ($0.77) this time. A move up from this level will reveal that market players are rejecting lower levels. The bulls will then try to push the price above $1 once again.
This view will become invalid if the pair falls below the 200-SMA.
SOL/USDT – Solana price analysis
Solana (SOL) price broke below the 50-day simple moving average (SMA) ($37) on May 19. Then, on May 20, it recovered sharply. However, the long wick seen on the candlestick on May 20 reveals that traders are taking profits at high levels and opening short positions.
Daily chart of SOL/USDT pair. Source: TradingView
Selling gained momentum on May 22 and SOL/USDT fell below the 50-SMA. As the selling continued, there was a pullback to the strong support at $21.1.
The price seems to have climbed above this support for now. Now the target of the pair is to move up to the 38.2% Fibonacci retracement level calculated at $34.11. If it breaks above the 50-day SMA and closes there, it will show that the short-term trend has turned in favor of the bulls.
On the other hand, if the price bounces off $34.11, the bears will try to push the price back below $21.10. If they are successful, the pair could drop to the 200-day SMA ($14.43).
MATIC/USDT – Polygon teknik analiz
Polygon (MATIC) price declined sharply after hitting an all-time high of $2.70 on May 18. The altcoin has outstripped all its gains since May 11 and dropped to the 50-day simple moving average (SMA) ($0.80).
Daily chart of MATIC / USDT parity. Source: TradingView
The bulls made an upside move defending the 50-day SMA. If the price continues to stay above the support, a rise could be seen towards the 38.2% Fibonacci retracement level calculated at $1.49 for MATIC/USDT. Breaking above this level will show that the selling pressure is in the direction of decreasing.
On the other hand, if the price bounces back below $1.49, the pair could slide back to the 50-SMA this time. The horizontally advancing 50-SMA and the relative strength index (RSI) around 52 point to a sideways course for the short term.
This view will be invalidated if the bears pull the price below the 50-day SMA. In such a case, the pair could drop to $0.68 and then as low as $0.54.
The views and opinions expressed here are those of the author alone and may not necessarily reflect those of Cointelegraph. Every investment and trading move involves risk, you should do your own research when making a decision.