Crypto Market Analysis: Bitcoin Remains Strong, S&P 500 Corrects
The cryptocurrency market continues to defy the recent weakness in the equity markets. Last week, the S&P 500 Index (SPX) plunged about 2%, but Bitcoin (BTC) rose roughly 12%. This strength attracted significant inflows into digital asset investment products, with CoinShares reporting $1.35 billion in inflows last week, bringing the total inflows over the past three weeks to $3.2 billion.
Bitcoin’s price action remains in a sideways range, but analysts remain optimistic about it reaching a new all-time high. Currently, the price is facing resistance near $68,500, and the bears are likely to test this level. However, a break above $70,000 could be on the horizon.
S&P 500 Index
The S&P 500 Index is currently in a correction phase within an uptrend, suggesting that short-term traders are booking profits after a recent rally. The index plunged below the 20-day simple moving average (SMA) on July 19th, but buyers are trying to push the price back above this level. If the index closes below the 20-day SMA, the next support level is likely to be the 50-day SMA (5,416). On the other hand, a rise back above the 20-day SMA could signal that the recent breakdown was a bull trap, leading to a potential climb towards 5,670.
US Dollar Index
The US Dollar Index (DXY) has been trading inside a descending channel pattern for several days, indicating a negative sentiment. The price bounced off the channel’s support line on July 18th, suggesting that the bulls are defending this level. If the price rises above 104.50, the index could reach the 20-day SMA (104.95), which is likely to act as resistance. A break below the channel could lead to a decline to 102.50, while a break above the channel could trigger a rally to 108.
Bitcoin
Bitcoin bounced off the $66,000 level on July 21st, but the recovery faltered near $68,500 on July 22nd, indicating that bears are selling on rallies. If the $66,000 level breaks down, the BTC/USDT pair could drop to the 50-day SMA ($63,799) support. A strong bounce off this level would signal a positive sentiment and a potential move towards the overhead resistance zone between $72,000 and $73,777. However, a break below the 50-day SMA would suggest that the bears are in control, potentially leading to a drop to the 20-day SMA ($61,126).
Ether
Ether (ETH) rose above the 50-day SMA ($3,425) on July 19th, but the momentum did not pick up, suggesting a lack of demand at higher levels. The bears are trying to pull the price back below the 50-day SMA, which could lead to a drop to the 20-day SMA ($3,246). This level is critical for the bulls to defend, as a break could push the ETH/USDT pair towards $3,000. To prevent this, the bulls will need to defend the moving averages and drive the price above $3,600, potentially leading to a rally towards the $4,000 to $4,094 resistance zone.
BNB
BNB (BNB) has been trading inside a large range between $495 and $635 for several days, indicating buying on dips and selling on rallies. The bulls pushed the price above the 50-day SMA ($586) on July 19th, but are finding it difficult to extend the rally to $635. Sellers will likely attempt to pull the price below the 50-day SMA, which could lead to a drop to the 20-day SMA. A break above $635 would suggest that the uptrend is resuming, potentially leading to a rally to $722.
Solana
Solana (SOL) broke above the downtrend line on July 20th, opening the doors for a possible rally to $210. However, the bears are likely to try to stall the rally near $189 and pull the price back towards the downtrend line. If the price rebounds off the downtrend line, it could signal a shift in momentum and a rally to $210. However, a break below the downtrend line would suggest that the bears are gaining control, potentially leading to a drop towards the moving averages.
XRP
The bears pulled XRP (XRP) below the breakout level of $0.57, but they could not sustain the lower levels, suggesting aggressive buying on dips. The bulls will try to push the price above $0.64, setting the stage for a move to $0.67 and later $0.74. Sellers are expected to defend the $0.74 level, and a turn down from this level could signal that the range-bound action will continue. The $0.57 to $0.54 zone is expected to act as strong support on declines, and a break below this zone would tilt the advantage in favor of the bears.
Toncoin
Toncoin (TON) has turned down from the moving averages, indicating that the bears are defending this level. The 20-day SMA ($7.29) has started to turn down, and the RSI is just below the midpoint, suggesting a slight advantage to the bears. The TON/USDT pair could slide to the solid support at $6.77. This level is expected to attract strong buying, potentially keeping the pair inside the $6.77 to $7.72 range. A break and close below $6.77 would complete a double-top pattern, starting a downtrend. On the other hand, a rise above $7.72 could challenge the stiff overhead resistance of $8.29.
Dogecoin
Dogecoin (DOGE) turned up from the 20-day SMA ($0.12) on July 19th and broke above the 50-day SMA ($0.13) on July 20th. The 20-day SMA has started to turn up, and the RSI is near the overbought zone, indicating that bulls have the edge. The DOGE/USDT pair could attempt a rally to the overhead resistance at $0.18. On the downside, the 50-day SMA and then the 20-day SMA are likely to act as strong support. If the price rebounds off the moving averages, it could improve the prospects of the resumption of the relief rally.
Cardano
Cardano (ADA) has been trading above the moving averages, but the bulls are struggling to push the price above $0.46. The ADA/USDT pair could remain stuck between the moving averages and $0.46 for some time. If the range resolves to the upside, it could signal the start of an up move toward $0.52, where the bears may mount a strong defense. Alternatively, if the price continues lower and plummets below the moving averages, it could signal that the bears remain active at higher levels, potentially leading to a slump to the strong support at $0.35.
**Disclaimer:** This article is for informational purposes only and should not be considered investment advice. Cryptocurrencies are volatile assets, and investing in them carries inherent risks. Always conduct your own research and consult with a qualified financial advisor before making any investment decisions.
