The S&P 500 Index (SPX) ended its five-week winning streak with a 0.42% decline last week, following the release of higher-than-expected United States Consumer Price Index and Producer Price Index for January. These reports on rising inflation have raised concerns that the Federal Reserve may delay rate cuts until later in the year. Previously, market observers were anticipating a rate cut as early as March.
Despite the adverse macroeconomic data, Bitcoin’s price (BTC) remained unaffected and rallied about 8%, closing the week at $52,137, its highest weekly close since November 2021. Although $52,000 has been acting as a resistance level in recent days, Bitcoin bulls have not rushed to book profits. This indicates that market participants remain bullish about the long-term prospects of Bitcoin.
Another positive factor for Bitcoin is the slowing outflows from the Grayscale Bitcoin Trust (GBTC). After experiencing outflows of $5.64 billion in January, the outflows from GBTC have decreased to $1.37 billion in February.
Could Bitcoin be starting the next leg of its uptrend, pulling select altcoins higher? Let’s analyze the charts to find out.
S&P 500 Index Price Analysis:
The S&P 500 Index bounced off the 20-day exponential moving average (4,940) on February 13, signaling an uptrend. However, the bears are not giving up easily and are attempting to defend the overhead resistance at 5,048. The negative divergence on the relative strength index (RSI) suggests a possible correction or consolidation in the short term. If the index breaks below the 20-day EMA, it could indicate the start of a deeper correction, with potential drops to the 50-day simple moving average (4,813) and subsequently to 4,650. On the contrary, if the index continues to rise and breaks above 5,048, it would signal the resumption of the uptrend, with a potential surge towards 5,200.
U.S. Dollar Index Price Analysis:
The U.S. Dollar Index (DXY) attempted to start an upward move on February 13 but faced strong selling pressure near 105. The price turned down and reached the 20-day EMA (104), an important support level to watch. If the price bounces off the 20-day EMA, the bulls will make another attempt to push the index to 106 and then to 107. Conversely, if the index breaks below the 20-day EMA, it would indicate that higher levels continue to attract selling by the bears. In that case, the index may fall to the 50-day SMA (103), which is likely to attract buyers.
Bitcoin Price Analysis:
Bitcoin is consolidating in an uptrend, with bears attempting to stall the rally at $52,000. However, the bulls have maintained the pressure. Consolidation near a crucial resistance level often resolves to the upside. If the bulls push and maintain the price above $52,000, it would indicate the start of the next leg of the uptrend, with the BTC/USDT pair potentially surging towards $60,000. On the other hand, if bears quickly drag the price below the 20-day EMA ($48,260), it could trigger stop-loss orders from short-term traders, leading to a potential plunge to the 50-day SMA ($44,647).
Ether Price Analysis:
Ether (ETH) rebounded off $2,717 on February 17, indicating that the bulls are trying to establish support at this level. The ETH/USDT pair rose above the immediate resistance of $2,868 on February 18, signaling the resumption of the uptrend. Buyers will attempt to maintain the momentum and push the price to the psychologically critical level of $3,000. However, the rally of the past few days has sent the RSI above 78, indicating the possibility of a minor correction or consolidation in the near term. Sellers will need to push the price below the 20-day EMA ($2,615) to signal a short-term top.
BNB Price Analysis:
BNB has pulled back in an uptrend, suggesting profit booking by short-term traders. Generally, pullbacks do not last more than three days in a strong uptrend. The rising 20-day EMA ($330) and the RSI near the overbought territory indicate that the bulls are in control. If the price turns up and breaks above $367, it would suggest the resumption of the uptrend, with the BNB/USDT pair potentially attempting a rally to $400. On the other hand, if the price continues lower and slips below $348, the pair may reach the 20-day EMA, which could attract buyers. However, if the bears prevail, the pair may plummet to the 50-day SMA ($314).
XRP Price Analysis:
XRP has been trading between the downtrend line and the 20-day EMA ($0.54) for the past few days, indicating indecision between the bulls and the bears. The 20-day EMA has started to turn up gradually, and the RSI has risen into the positive zone, indicating that the bulls have the upper hand. If the price breaks and closes above the downtrend line, it would suggest that the correction may be over, and the XRP/USDT pair may attempt a rally to $0.67. However, if the price sharply turns down from the downtrend line and falls below the 20-day EMA, it would indicate that the bears remain in control, with the pair potentially descending to $0.50.
Solana Price Analysis:
Solana pulled back to the neckline of the inverse head-and-shoulders pattern on February 17, and the bulls held their ground. The upsloping 20-day EMA ($106) and the RSI above 62 indicate that the bulls are in control. There is a minor resistance at $119, but that is likely to be overcome. If the price breaks above $119, the SOL/USDT pair may retest the stiff overhead resistance at $127. If this level is breached, the pair may reach the pattern target of $135. However, this optimistic view may be negated if the price turns down and falls below the 20-day EMA, potentially leading to long liquidations and a drop to the 50-day SMA ($100).
Cardano Price Analysis:
Cardano’s long tail on the February 17 candlestick shows that the bulls continue to view dips to the 20-day EMA ($0.56) as buying opportunities. The bulls are attempting to maintain the price above the immediate resistance of $0.62. If they succeed, the ADA/USDT pair could rally to the vital resistance at $0.68. This level may witness a tough battle between the bulls and the bears, but if the buyers prevail, the next target is expected to be $0.90. On the contrary, if the price sharply turns down from $0.68, it would indicate that the bears are defending the level vigorously. A break below the 20-day EMA would suggest a weakening bullish momentum.
Avalanche Price Analysis:
Avalanche turned down from the $42 level on February 15, but the bulls managed to hold the price above the 20-day EMA ($38.40). The bulls will once again attempt to clear the obstacle at $42, and if successful, the AVAX/USDT pair may complete an inverse H&S pattern and surge to $50, which could prove to be a difficult barrier to cross. On the downside, the 20-day EMA is a key support level to watch. A break below this level may lead to a drop to the 50-day SMA ($36.16), suggesting that the pair may trade between $32 and $42 for some time.
Dogecoin Price Analysis:
The bears tried to pull Dogecoin back into the symmetrical triangle pattern on February 17, but the bulls aggressively protected the level. The 20-day EMA ($0.08) has started to turn up gradually, and the RSI is above 63, indicating that the bulls are attempting a comeback. If the bulls clear the hurdle at $0.09, the DOGE/USDT pair could climb to the $0.10 to $0.11 resistance zone. However, if the price turns down and collapses below the moving averages, it would suggest that the bears are selling on every minor relief rally, with potential selling intensifying on a break below the uptrend line.