The major U.S. stock market indices saw a continuous decline last week due to worsening macroeconomic conditions that raised concerns about a global recession. The Dow Jones Industrial Average hit its lowest level in 2022, with major indices recording their fifth weekly close in the last six weeks.
Although Bitcoin (BTC) experienced only a slight decline this week, it is at risk of closing at its lowest level since 2020. A sustained lower level could indicate a bear trap. The upcoming price action is expected to be highly volatile as bulls and bears compete for dominance.
Many investors often miss out on buying opportunities during sharp corrections as they attempt to time the market bottom. It’s advisable for traders to focus on projects they believe in and gradually accumulate coins over a few weeks or months since not all coins hit bottom simultaneously.
While Bitcoin approaches yearly lows, there are certain altcoins displaying resilience. Let’s take a look at the charts of five cryptocurrencies that show promise in the short term.
BTC/USDT
The Bitcoin bulls successfully defended the support zone of $18,626 to $17,622 in recent days, but face strong selling pressure at the 20-day exponential moving average ($19,720). This indicates that bears are still dominating market movements.
Although the downward sloping moving averages suggest bearish control, a positive divergence on the relative strength index (RSI) hints at weakening bearish momentum. A break above the 20-day EMA could signal a potential uptrend, with targets at the 50-day simple moving average ($21,043), $22,799, and potentially $25,211.
On the flip side, a drop below $17,622 could reignite selling pressure, pushing the price down to $14,500.
ATOM/USDT
Cosmos (ATOM) has been trading above the breakout level of $13.46, indicating positive sentiment and dip-buying behavior among traders. The 20-day EMA has stabilized, suggesting a balance between supply and demand.
A break above $15.26 could favor buyers, leading the ATOM/USDT pair towards $17.20. However, failing to maintain this level might shift advantage to bears, potentially driving the price down to $10.
ALGO/USDT
Algorand (ALGO) broke out of its range-bound action between $0.27 and $0.38, indicating a potential uptrend. A move above $0.38 could pave the way for a rally to $0.50, while a drop below this level might lead to a retest of the 20-day EMA at $0.33.
Seeing a breakthrough above $0.41 would signify a resumption of the up-move, whereas a decline below the 20-day EMA could pull the pair towards $0.36.
CHZ/USDT
Chiliz (CHZ) saw a sharp recovery from June lows, breaking above $0.26 and indicating a bullish trend. Buyers defending the support level at $0.26 and a positive RSI indicate bullish sentiment, with targets at $0.33 and potentially $0.32.
However, a drop below $0.26 could signal bearish pressure, pushing the price down to the 20-day EMA and later the 50-day SMA at $0.21.
QNT/USDT
Quant (QNT) demonstrates strength trading above both moving averages despite negative sentiments in the crypto sector. Breaking above $112 could lead to further gains towards $154, while a drop below $112 may spark a pullback to the 20-day EMA at $106.
Despite reaching near the downtrend line, a rebound above $112 signals positive sentiment, with potential targets at $121 and beyond.
