The S&P 500 Index and the Nasdaq Composite reached new all-time highs last week, signaling a positive sentiment among investors. Bitcoin (BTC) is also striving to keep up and is currently less than $2,000 away from its lifetime high of $68,990 achieved in November 2021.
The momentum is favoring buyers and there is a possibility that Bitcoin’s price will reach a new all-time high in the coming days. However, the main question is whether surpassing $68,990 will initiate the next phase of the uptrend or if the price will sharply decline, trapping the aggressive bulls.
During a FOMO (fear of missing out) phase, traders can make significant returns in a short period of time. However, it is important to be cautious as vertical rallies are often followed by steep declines. Traders should be prepared with stop-loss orders to protect their gains from evaporating quickly.
Now, let’s analyze the charts to determine if the bulls can drive Bitcoin to a new all-time high and maintain it, or if it’s time to book profits.
S&P 500 Index:
The S&P 500 Index closed at a new all-time high on March 1, indicating that the bulls are firmly in control. The index has been trading within an ascending channel pattern, which suggests that the bears may pose a strong challenge at the resistance line. If the price turns down from this line, the bears will attempt to pull the index towards the support line, potentially starting a short-term corrective phase.
On the other hand, if the bulls push the price above the channel, it will signal an increase in momentum. This could initiate a vertical rally, taking the index to levels of 5,300 and 5,500. However, traders should be cautious as the negative divergence on the relative strength index (RSI) indicates that the bulls may be losing strength.
U.S. Dollar Index:
The U.S. Dollar Index (DXY) briefly moved above the 20-day exponential moving average (EMA) on February 29 but failed to sustain the momentum. The price was subsequently pulled back below the 20-day EMA on March 1.
The 20-day EMA has flattened out and the RSI is near the midpoint, suggesting a possible range-bound action in the near term. If the price remains below the 20-day EMA, the index could decline to the 50-day simple moving average (SMA) at 103. However, buyers are likely to defend this level.
Conversely, if the price turns upwards and surpasses 104.30, it will indicate strong buying at lower levels. This could lead to a rise towards 105, with a break above this resistance potentially opening the doors for a further rise to 106.
Bitcoin:
Bitcoin has been in a solid uptrend in recent days. Although the bears attempted to halt the upward movement around $64,000, this resulted in the formation of a pennant pattern.
The bulls reasserted their dominance by pushing the price above the pennant on March 4. This indicates the start of the next leg of the uptrend, with potential targets at the all-time high of $68,990 and $76,000, which is the pattern target of the breakout from the pennant.
Time is running out for the bears, as they will need to quickly bring the price below $60,000 to stage a comeback. If they succeed, many short-term traders’ stop-loss orders may be triggered, potentially causing the BTC/USDT pair to drop to the 20-day EMA at $56,250.
Ether:
Ether experienced profit booking near $3,600 on February 29, but the bears failed to initiate a pullback, indicating strong buying on every minor dip.
The bulls are once again attempting to overcome the resistance at $3,600. If successful, the ETH/USDT pair could enter the next leg of the uptrend and surge towards $4,000 and later to $4,150.
The upsloping moving averages suggest that the bulls are in control. However, the RSI has been in the overbought zone for some time, increasing the likelihood of a short-term pullback. Immediate support on the downside is at $3,300, followed by the 20-day EMA at $3,129.
BNB:
BNB has been in an uptrend for several days. The bears attempted to stall the rally at $427, but the bulls bought the dip on February 29, indicating positive sentiment.
The rising moving averages and the overbought RSI suggest that the path of least resistance is to the upside. If buyers push the price above $427, the BNB/USDT pair could reach $460. However, breaking above this resistance level may prove challenging.
The critical support to watch on the downside is the 20-day EMA at $383. A break below this level would indicate that short-term traders may be exiting their positions, potentially starting a corrective phase towards the 50-day SMA at $338.
XRP:
XRP experienced a sharp decline on March 3, but the long tail on the candlestick indicates strong buying at lower levels.
The upsloping 20-day EMA at $0.58 and the overbought RSI suggest that the bulls are in control. There is a minor resistance at $0.67, but it is likely to be surpassed. If that happens, the rally could continue towards the strong resistance at $0.74.
However, if the price sharply declines from $0.67, it would indicate fierce defense by the bears. This could push the price down to the 20-day EMA and keep the XRP/USDT pair range-bound between $0.46 and $0.67 for some time.
Solana:
Solana closed above the $126 resistance on March 1, but the bulls are struggling to maintain momentum, suggesting a lack of demand at higher levels.
If the price remains above $126, it increases the likelihood of the uptrend resuming. Breaking above the $138 level could lead to a rise towards $143 and then $158.
However, if the $126 level is breached, the pair may decline to the 20-day EMA at $116. Only a break below the 20-day EMA would suggest that the breakout above $126 was a false move, potentially causing a drop to the 50-day SMA at $104.
Cardano:
Cardano started the next leg of the uptrend after breaking above the $0.68 barrier on March 1. The bears attempted to pull the price below the breakout level on March 3, but the bulls held their ground, indicating strong buying on dips.
The up move is likely to reach $0.90, where the bears are expected to mount a strong defense. If the momentum remains strong and buyers push through $0.90, the rally could extend to $1.25. However, crossing this level may prove challenging.
The RSI is currently above 80, indicating a risk of the rally stalling. The 20-day EMA at $0.64 is the key support to watch on the downside. A break below this level would signal weakening bullish momentum and could push the ADA/USDT pair to the 50-day SMA at $0.56.
Dogecoin:
Dogecoin has been experiencing a strong bull run in recent days. The bears attempted to pull the price lower on March 3, but aggressive buying by the bulls resulted in a long tail on the candlestick.
The bulls resumed the uptrend by pushing the DOGE/USDT pair above the $0.16 overhead resistance on March 4. This opens the possibility of a rise towards $0.18 and then $0.22. However, the RSI is deep in the overbought territory, suggesting a potential consolidation or correction.
The first support on the downside is at $0.16, followed by $0.12. If these levels are breached, it would indicate that the uptrend may be over.
Avalanche:
Avalanche completed a bullish inverse head-and-shoulders pattern after the price closed above the neckline at $42 on March 1.
The AVAX/USDT pair is currently facing resistance near the $42 level. If buyers manage to flip this level into support and push the price above $45, the pair could rally towards the psychological resistance at $50. Breaking above $50 could lead to a further rise towards the pattern target of $57.
To weaken the bulls, sellers would need to pull the price below the 20-day EMA at $40. This could lead to a decline towards the 50-day SMA at $37, suggesting that the breakout on March 1 may have been a false move.
Disclaimer: This article does not provide investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research before making a decision.