The S&P 500 Index (SPX) closed the week with a nominal loss of 0.29% while Bitcoin (BTC) seems to be on track for an over 5% loss, dragging several altcoins down with it. Despite this, Bitcoin’s rebound on May 12 indicates some hope for recovery. However, Material Indicators’ recent analysis cautions against optimism, citing a concerning lack of strong bids from whales at lower levels. They argue that Bitcoin’s bullish trajectory could be invalidated if it sustains below the 200-week moving average.
In the coming days, one’s focus should shift to the development of debt ceiling talks between Congress and the White House. The uncertainty surrounding potential U.S. default could keep equities markets in check, but it’s difficult to predict how Bitcoin and altcoins will react to such chaos.
Bitcoin recently entered a corrective phase, as most altcoins have broken below their respective support levels. Only a select few cryptocurrencies show promise on the charts. Analyzing these top five cryptocurrencies shows potential for near-term gains.
Bitcoin’s May 12 candlestick shows a long tail, indicating bullish support for dips near the inverse head and shoulders (H&S) pattern neckline. To regain control, bulls must surpass resistance at the line, which could lead to a retest of the $31,000 overhead resistance. Conversely, if the price turns down from the 20-day EMA, bears could sink the BTC/USDT pair below $25,250, intensifying the selling pressure and potentially leading to a crash at $20,000.
Cardano (ADA) rebounded strongly on May 11, which could signal lower levels attracting more buyers. The ADA/USDT pair may soar if bulls can break through the 20-day EMA ($0.38) resistance. However, there is the possibility of the 20-day EMA causing a price reversal, leading to a retest of the uptrend line, eventually weakening support and potentially dropping to $0.30.
Cosmos (ATOM) bounced back from the $10.20 support, demonstrating that bulls continue to buy the dips. If the ATOM/USDT pair rallies above the 50-day SMA, it could climb as high as the downtrend line. If support at $10.20 becomes compromised, though, the descending triangle will complete and the pair may plummet to $8.50.
Lido DAO (LDO) also experienced a rebound, reaching an overhead resistance at the 20-day EMA ($1.95). If buyers can drive the LDO/USDT price above that, a sustained recovery above the downtrend line could initiate, breaking bearish sentiment. However, if the price falls below $1.60, the downtrend could resume.
Lastly, Arbitrum (ARB) showcased a noteworthy rebound, breaking past the $1.20 resistance. If the ARB/USDT pair continues to climb, it could reach $1.40 and possibly $1.50. A price reversal from $1.20, however, could indicate consolidation between $1 and $1.20 in the near term.
In conclusion, while some cryptocurrencies are showing signs of potential gains, traders should remain cautious and conduct thorough research before making any investment or trading decisions.
Source: Cointelegraph
