Most major cryptocurrencies are stuck in a tight range awaiting direction from Bitcoin.
Pantera Capital Founder and CEO Dan Morehead is bullish on Bitcoin (BTC) due to the upcoming halving as he believes that “if the new supply of Bitcoin is cut in half, all else being equal, the price should rise”. If history were to repeat itself, Morehead expects the top-ranked cryptocurrency on CoinMarketCap to rally to $115,212 by August 2021. The CEO also said that gold might be losing its luster but he does not expect the yellow metal to vanish overnight.
Bloomberg’s senior commodity strategist Mike McGlone said that in traditional commodity markets, higher prices are an incentive for the miners to produce more. If demand cannot keep up with new supply, the price either stagnates or drops.
However, Bitcoin’s mining cannot be altered, which makes it a better bet compared to gold. McGlone also pointed out that Bitcoin’s 180-day volatility has hit an all-time low. The last time it had done so resulted in the bull market that started in 2015 and ended in 2017.
Daily cryptocurrency market performance. Source: Coin360
However, Peter Schiff considers buying Bitcoin before halving as a crowded trade and according to him, such trades usually do not behave as expected. Therefore, Schiff expects a lack of buying support post halving, which could result in a sharp drop.
Digital Asset Investment Management chief operating officer Adam Pokornicky believes that top US banks such as JPMorgan Chase and Goldman Sachs could be advising their clients against buying Bitcoin.
Bitcoin (BTC) has broken out of the pennant, which is a huge positive. This indicates a possible resumption of the uptrend. If the bulls can push the price above $9,456.77, a rally to $10,000 and then to $10,500 is likely.
BTC–USD daily chart. Source: Tradingview
Both moving averages are sloping up and the relative strength index is in the overbought zone, which suggests that the bulls are in command.
However, if the bears defend the $9,456.77 level aggressively, a drop to the breakout level of the pennant is likely. If this retest holds, the possibility of a breakout above $9,456.77 increases.
Conversely, if the BTC/USD pair turns down from the current levels or $9,456.77 and breaks below the breakout level of the pennant, a drop to the 20-day exponential moving average ($8,180) is likely.
The stop-loss on the rest of the long position can be kept just below the 20-day EMA because if this support cracks, a deeper correction is possible.
Ether (ETH) has been holding just above the centerline of the ascending channel. Both moving averages are sloping up and the RSI has been holding above the 60 levels, which suggests that bulls have the upper hand.
ETH–USD daily chart. Source: Tradingview
If the bulls can push the 2nd-ranked cryptocurrency on CoinMarketCap above the downtrend line, a rally to the resistance line of the channel is likely. A breakout of the channel will be a huge positive as that can result in a rally to $250 and then $288.599.
Conversely, if the ETH/USD pair turns down from the downtrend line and breaks below the 20-day EMA ($195), it will signal weakness. Below this level, a drop to the support line of the channel is possible.
For now, traders can keep the stop-loss on the remaining long positions at $185. A break below the channel will indicate a possible change in trend.
Having held the critical support at $0.20570 on May 4, the bulls are currently attempting to push XRP towards the overhead resistance zone of $0.23612-$0.24770. The upsloping moving averages and the RSI above 60 levels suggest that bulls have the upper hand.
XRP–USD daily chart. Source: Tradingview
If the bulls can scale the price above $0.24770, the 3rd-ranked cryptocurrency on CoinMarketCap can rally to the long-term downtrend line at $0.28.
Conversely, if the bulls fail to push the price above $0.24770, the XRP/USD pair is likely to remain range-bound for a few more days.
A break below $0.20570 will be the first sign of weakness. Below this level, a drop to $0.17372 is possible. Therefore, the stop-loss on the long positions can be kept at $0.20.
Bitcoin Cash (BCH) has held the 20-day EMA ($244) for the past two days but the bulls have not been able to achieve a strong bounce off it. This suggests a lack of urgency among the bulls to buy at the current levels.
BCH–USD daily chart. Source: Tradingview
If the bulls fail to propel the 5th-ranked cryptocurrency on CoinMarketCap above the downtrend line, the bears will attempt to sink the price below $234.55. If successful, a drop to $200 is likely. Therefore, traders can keep the stop-loss on the long positions at $230.
Conversely, if the bulls can propel the BCH/USD pair above the downtrend line, a move to $280.47 is likely. A breakout of this level will signal strength and open the doors for a rally to $350.
Bitcoin SV (BSV) has been trading above the 20-day EMA ($200) for the past two days. This shows that bulls are buying the dips but the failure to push the price above the downtrend line suggests that demand dries up at higher levels.
BSV–USD daily chart. Source: Tradingview
A break below the 20-day EMA can result in a fall to $187.16 and then to $170. The bulls are likely to defend this level aggressively.
As the 6th-ranked cryptocurrency on CoinMarketCap has been trading in a large range of $170-$227 for the past few weeks, a drop to $170 can offer a low-risk buying opportunity.
Conversely, if the bulls push the price above the downtrend line, a rally to $227 is possible. Above this level, the BSV/USD pair is likely to pick up momentum and rally towards $284. Therefore, a breakout above $227 can also offer a buying opportunity.
Although the bulls have sustained Litecoin (LTC) above the 20-day EMA ($45.45) for the past two days, they have not been able to achieve a strong bounce. This is a negative sign as it shows a lack of demand at higher levels.
LTC–USD daily chart. Source: Tradingview
A drop below the 20-day EMA will be the first indication that the bears are making a comeback. The trend is likely to turn negative on a break below the 50-day simple moving average ($42.16). Therefore, the traders can protect their long positions with a stop-loss of $42.
Conversely, a strong bounce off the current levels can carry the 7th-ranked cryptocurrency on CoinMarketCap to the $50-$52.2803 resistance zone. Above this zone, a rally to $63.8769 is likely.
The bulls have kept Binance Coin (BNB) above the 20-day EMA ($16.39) but have not been able to push the price above the downtrend line. This suggests a lack of demand at higher levels.
BNB–USD daily chart. Source: Tradingview
The 8th-ranked crypto-asset on CoinMarketCap has formed doji candlestick patterns in the past two days, which shows indecision among the bulls and the bears.
A break above the downtrend line will be the first sign of strength. If the BNB/USD pair can scale above $18.1377, it could result in a quick up move to $21.50.
Conversely, if the bears sink the price below the support of $16.30, a drop to the 50-day SMA ($14.53) is possible. Therefore, the traders can keep the stop-loss on the long positions at $15.50.
EOS dipped below the uptrend line on May 4 but the bears could not capitalize on the breakdown. The altcoin recovered and closed (UTC time) above the 20-day EMA ($2.74), which suggests buying at lower levels.
EOS–USD daily chart. Source: Tradingview
However, since then, the bulls have not been able to push the price above the overhead resistance of $2.8319, which is a negative sign. Currently, the 9th-ranked cryptocurrency on CoinMarketCap is being squeezed between $2.8319 and the uptrend line.
Soon, a large range move is likely but it is difficult to predict the direction of the breakout because the moving averages and the RSI suggest a balance between buyers and sellers.
If the bulls can propel the EOS/USD pair above the downtrend line, a rally to $3.1802 is possible. Conversely, if the bears sink the pair below the downtrend line, a drop to $2.3314 is possible. Traders can protect their long positions with a stop-loss of $2.50.
Tezos (XTZ) has been facing stiff resistance close to $2.8424 level for the past two days. This has kept the altcoin range-bound between $2.8424 and $2.55900337. This tight range action suggests a balance between supply and demand.
XTZ–USD daily chart. Source: Tradingview
Usually, after a tight consolidation, a trending move starts. A break above $2.8424 will tilt the advantage in favor of the bulls and can result in a rally to $3.07369598. If this level is scaled, the 10th-ranked cryptocurrency on CoinMarketCap can reach $3.2712.
On the other hand, a break and close (UTC time) below $2.55900337 will complete a bearish head and shoulders pattern that has a target objective of $2.04131076. Therefore, the stops on the remaining long positions can be retained at $2.55.
However, it is unlikely to be a straight fall because the bulls are likely to defend the support line of the ascending channel aggressively. If this support holds, it could offer a buying opportunity but if this support cracks, the advantage will shift in favor of the bears.
The bulls are struggling to push Stellar Lumens (XLM) above the overhead resistance at $0.073434. However, the positive thing is that the bulls have not given up much ground, which suggests strength.
XLM–USD daily chart. Source: Tradingview
If the bulls can propel the 11th-ranked cryptocurrency on CoinMarketCap above $0.073434-$0.076994 resistance zone, a rally to $0.088311 is likely. Both moving averages are sloping up and the RSI is close to the overbought zone, which suggests that bulls have the upper hand.
This bullish view will be invalidated if the XLM/USD pair turns down from the current levels and drops below the 20-day EMA ($0.064) and $0.062805 support zone. Below this zone, a deeper correction is likely.
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.
Market data is provided by HitBTC exchange.