Top 5 cryptocurrencies to watch this week: BTC, BNB, NEO, YFI, LINK

Bitcoin remains stuck in a tightening range but select altcoins may begin moving higher if they bounce off their key support levels.

This week Digital Assets Data CEO Mike Alfred told Cointelegraph that mainstream investors are still “skeptical of Bitcoin and the ecosystem.” 

However, Alfred believes that this “skepticism and disbelief” will turn out to be a positive for Bitcoin (BTC) because when the “traditional folks capitulate, they will be forced by their clients and partners to get involved at significantly higher prices.”

While Bitcoin has struggled to start a sustained uptrend in the past few weeks, select altcoins and tokens in the DeFi space have been in a strong bull run. This shows that traders attention has shifted away from Bitcoin.

Crypto market data daily view

Crypto market data daily view. Source: Coin360

Pantera Capital founder and CEO Dan Morehead believes that the DeFi space will outrun Bitcoin in the next five years and grow by about 100x. 

In the long-term, most analysts are uber bullish on the crypto space but what can traders expect in the next few days? 

Let’s have a look at the cryptocurrencies that could offer short-term trading opportunities and spot the critical levels on each of them.

BTC/USD

Bitcoin completed a bullish inverse head and shoulders pattern on July 27 when it closed above $10,500 and usually the price retests the breakout levels of such reversal patterns.  

BTC/USD daily chart

BTC/USD daily chart. Source: TradingView

In ideal conditions, the price should not dip below the neckline of the inverse H&S pattern, but trading is anything but ideal.

Although the bears pulled the BTC/USD pair below the neckline on Sep. 3, there has not been much follow up selling, which suggests buying by the bulls at lower levels. However, this buying dries up when the price tries to move up above the $10,500 level.

Due to this, the pair is currently stuck in the $9,835–$10,625 range. After the bears failed to sink the price below the range on Sep. 8, the bulls today attempted to push the price above the overhead resistance but failed.

The 20-day exponential moving average ($10,719) is just above the resistance of the range, hence, the bears are likely to defend it aggressively. 

However, if the bulls can propel the pair above the 20-day EMA and sustain the higher levels for three days, it will suggest that the correction is over. That could result in a retest of $12,460 and if this resistance is crossed, the uptrend is likely to resume.

This bullish view will be invalidated if the pair breaks and sustains below the $9,835 support. 

BTC/USD 4-hour chart

BTC/USD 4-hour chart. Source: TradingView

The 4-hour chart shows that the bears are aggressively defending the $10,625 resistance but if they fail to sink the price below the $10,200 support, the bulls will once again try to clear the overhead resistance of the range.

If they succeed, aggressive traders are likely to jump in, which could result in a quick move to $11,400 and possibly $12,000.

Contrary to this assumption, if the bears sink the price below the $10,200 support, a drop to $10,000 and then to $9,835 is possible. 

BNB/USD

While most major cryptocurrencies are searching for a bottom, Binance Coin (BNB) has resumed its uptrend and made a new 52-week high, which is a sign of strength.

BNB/USD daily chart

BNB/USD daily chart. Source: TradingView

Although the relative strength index was showing the formation of a bearish divergence, the sharp move on Sep. 12 invalidated this bearish setup.

Currently, the BNB/USD pair is facing stiff resistance at the $32 level but if the bulls do not allow the price to dip below the critical support at $27.1905, a retest of $32 is likely. A break above this resistance could push the price to $38.

Contrary to this assumption, if the bears pull the pair down below $27.1905 it will indicate that the current move might have been a bull trap.

BNB/USD 4-hour chart

BNB/USD 4-hour chart. Source: TradingView

The bears are aggressively defending the $32 level as seen from the long bearish candle on the 4-hour chart. However, the positive sign is that the bulls are not panicking and they continue to purchase the dip.

They will now again try to push the price above the $32 resistance. If they succeed, the momentum is likely to pick up but if the price again turns down from $32, the pair could remain range-bound for a few days.

NEO/USD

The failure of the bears to sink and sustain NEO below the breakout level of $16.72441 attracted buying by the bulls who pushed the price to $21.97869 today.

NEO/USD daily chart

NEO/USD daily chart. Source: TradingView

The bears are defending the $22–$22.82612 resistance zone aggressively but if the NEO/USD pair rebounds off the 20-day EMA ($18.54), the bulls will once again attempt to push the price above the resistance zone.

If they succeed, the next leg of the up-move is likely to begin. There is a minor resistance at $25.23 above which the momentum is likely to pick up.

However, if the bears sink the price below the 20-day EMA, the pair might drop to $16.72441. A breakdown and close below this support will be a huge negative. 

NEO/USD 4-hour chart

NEO/USD 4-hour chart. Source: TradingView

The failure to break above the $22 level could have attracted profit booking by the short-term bulls. This has pulled the price below the 20-EMA.

However, if the bulls can keep the price above $19.27244, (50% Fibonacci retracement level), then another attempt to clear the overhead resistance is likely.

A break below the $19.27244–$18.63376 support could weaken the momentum and result in a drop to $16.72441.

YFI/USD

The correction in Yearn.finance (YFI) that started on Aug. 31 found support close to $21,345, which was the 50% Fibonacci retracement level of the entire run-up from $3,000–$39,690. 

YFI/USD daily chart

YFI/USD daily chart. Source: TradingView

Repeated attempts by the bears to break below the $21,345 support failed and the range shrunk between Sep. 5 and Sep. 8, which suggested indecision among the bulls and the bears.

This uncertainty resolved to the upside with a sharp up-move on Sep. 9, which indicated that the bulls had reasserted their dominance. The target objective of this next leg of the uptrend is $46,632.46 and then the psychological resistance at $50,000.

However, the bears are attempting to stall the rally at $43,966.31. If they can sink the YFI/USD pair below the 50% Fibonacci retracement level of the most recent leg of the rally at $31,011.37, the momentum is likely to weaken. 

The developing bearish divergence on the RSI warrants caution but if the pair rebounds from the $34,068.74–$31,011.37 support zone, the bulls will make another attempt to resume the uptrend. 

YFI/USD 4-hour chart

YFI/USD 4-hour chart. Source: TradingView

The bears have pulled down the pair below the 20-EMA, which suggests that the short-term momentum has weakened. The next support on the downside is $31,011.37.

If the pair rebounds sharply from $31,011.37, the bulls will make one more attempt to push the price above the overhead resistance at $43,966.31.

LINK/USD

Chainlink (LINK) has thrice turned down from the $13.28 levels since Sep. 6 but the positive sign is that the bears have not been able to sink the price below the trendline, which shows buying at lower levels.

LINK/USD daily chart

LINK/USD daily chart. Source: TradingView

If the LINK/USD pair again rebounds off the trendline, the bulls will make one more attempt to push the price above $13.28. If they succeed, the pair is likely to pick up momentum and rally to the downtrend line.

This level is again likely to act as a resistance but if the bulls can push through it the pair could rally to $17.7777.

However, if the bears sink the price below the trendline, it will suggest weakness, which could result in a drop to $8.908. Such a move will be a huge negative and it will hurt sentiment.

LINK/USD 4-hour chart

LINK/USD 4-hour chart. Source: TradingView

The 4-hour chart shows that the bears are aggressively defending the $13.28 levels but the positive sign is that the bulls have not allowed the price to dip below the $11 level. 

If the pair rebounds off the current levels or from the trendline, the bulls will make one more attempt to push the price above the $13.28 resistance. If they succeed, momentum is likely to pick up and a quick move to $15 is likely.

This bullish view will be invalidated if the bears sink and sustain the price below the trendline.

The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Every investment and trading move involves risk, you should conduct your own research when making a decision.

[…]
Learn more

Be the first to comment

Leave a Reply