Risky assets marginally extend their up-move in April. The S&P 500 Index rose around 1.5% in April while Bitcoin (BTC) is on track to end the month with gains of more than 4%. Could the rally continue in May or is it time for a pullback?
The recovery could face headwinds if the United States banking woes escalate further. JPMorgan Asset Management chief investment officer Bob Michele said in an interview with Bloomberg that the turmoil at First Republic Bank is unlikely to be limited to the bank only, and could cause a domino effect.
If that happens, then the U.S. equity markets may witness a correction. However, it is difficult to predict how Bitcoin will react to such a crisis because, in the past few days, BTC price rose while legacy banking troubles deepened. But in case of a major upheaval in the U.S. banking sector, it is possible that Bitcoin will also face a correction sooner or later.
In the near term, Bitcoin and select altcoins are showing strength. Let’s study the charts of five cryptocurrencies that may outperform over the next few days.
Bitcoin price analysis
After two days of low volatile trading in Bitcoin, the bulls are trying to assert their supremacy on April 30.
The 20-day exponential moving average ($28,783) has started to turn up gradually and the relative strength index (RSI) is in the positive zone, indicating that the path of least resistance is to the upside.
If bulls kick Bitcoin’s price above $30,000, the BTC/USDT pair may climb to the overhead resistance zone of $31,000 to $32,400. Buyers may face formidable resistance at this zone but if it is crossed, the pair can soar toward $40,000.
The 50-day simple moving average ($28,026) is the important support to keep an eye on. If BTC price collapses below this level, the bears will sense an opportunity and try to sink the pair to $25,250.
The bears tried to yank the pair below the 20-EMA but the bulls held their ground. This may have attracted further buying and the bulls will next try to drive the price above $30,000. If they succeed, Bitcoin can rise to $30,500, or even $31,000.
Conversely, if the price turns down and breaks below the 20-EMA, it will suggest that bears are selling near overhead resistance levels. The pair may then slip to the 50-SMA.
The bulls will try to protect this level but if bears overpower them, the next stop is likely to be $27,000. Buyers are likely to defend the zone between $27,000 and $25,250 with all their might.
Solana price analysis
The bulls did not allow Solana (SOL) to break back below the downtrend line during the most recent leg of the correction, indicating demand at lower levels.
Buyers will next try to propel the price to the overhead resistance at $27.12. This remains the key resistance to watch for in the near term because if bulls catapult the price above it, the SOL/USDT pair may accelerate toward $39.
This bullish view could invalidate in the near term if the price turns down and breaks below the moving averages. The pair could then plummet to the crucial support at $18.70. If the price rebounds off this level, it will signal that the pair may oscillate inside the large range between $18.70 and $27.12 for some time.
The moving averages on the 4-hour chart have started to turn up and the RSI is in the positive territory, indicating that buyers are in control. The bears are trying to stall the recovery at $24 but if bulls overcome this barrier, the pair may pick up momentum and rally toward $25.50.
If the bears want to prevent the rally, they will have to quickly tug the price back below the 20-EMA. The 50-SMA will be the support level to watch here if price begins to slide.
Cosmos price analysis
The long tail on Cosmos’ (ATOM) April 26 candlestick shows that the bulls are fiercely defending the support at $10.20.
Buyers have pushed the price above the moving averages and will try to reach the downtrend line. This is an important level to keep an eye on because a break and close above it will open the doors for a potential rally to $13.50 and then to $15.50.
On the other hand, if the ATOM/USDT pair reverses direction from the downtrend line, it will suggest that bears are trying to form a descending triangle pattern. A decline below the moving averages will open the doors for a possible retest of $10.20.
The 20-EMA on the 4-hour chart has turned up and the RSI is near the overbought zone, indicating that bulls are in control. There is a minor hurdle at $12.13 but that is likely to be crossed. ATOM price may then rise to test the downtrend line.
Instead, if the price turns down from $12.13, the bears will again try to sink the pair below the 20-EMA. If they manage to do that, it will suggest that the buyers may be losing their grip. The pair then risks a slide to the 50-SMA.
Related: ‘Good luck bears’ — Bitcoin traders closely watch April close with BTC price at $29K
Internet Computer price analysis
Internet Computer (ICP) slipped below the 50-day SMA ($5.38) on April 26 but that proved to be a bear trap. The price turned up on April 27 and started a strong recovery.
The 20-day EMA ($5.74) has started to turn up and the RSI has jumped into positive territory, indicating that bulls have a slight edge. If the price does not give up much ground from the current level or rebounds off the 20-day EMA, it will suggest that the bulls are buying the dips.
That will enhance the prospects of a rally to the downtrend line where the bears will again mount a strong defense. On the downside, a break below the 50-day SMA will tilt the advantage in favor of the bears.
The 4-hour chart shows that the ICP/USDT pair is in a corrective phase. The first support is at the 20-EMA, which is close to the 38.2% Fibonacci retracement level of $6.14. If the price bounces off this support, the pair may rally to $7.23 and eventually to $7.70.
Contrary to this assumption, if the price continues lower and breaks below the 20-EMA, it will suggest that the short-term bulls may be booking profits. That could pull the price to the 50-SMA, which is near the 61.8% retracement level of $5.72.
Hedera price analysis
The bears repeatedly tried to sink Hedera (HBAR) below $0.06 but the bulls held their ground. The failure to break the support attracted buyers who will try to push the price above the downtrend line.
The 20-day EMA ($0.06) is flattening out and the RSI has climbed above the midpoint, indicating that the selling pressure is reducing. If buyers thrust the price above the resistance line, the bullish momentum may pick up and the HBAR/USDT pair could rally to the overhead resistance at $0.08.
Contrarily, if the price turns down from the current level or the resistance line, it will suggest that the bears remain active at higher levels. That increases the possibility of a break below $0.06.
The 4-hour chart shows that the bulls flipped the moving averages into support and have launched an up-move that is likely to reach the resistance line. This level is expected to act as a strong resistance but on the way down, if the pair rebounds off the 20-EMA, it will suggest a change in sentiment from selling on rallies to buying on dips.
The pair may then break above the resistance line and start its journey to $0.07 and subsequently to $0.08. If the bears want to gain the upper hand, they will have to quickly pull HBAR price below the moving averages.
This article does not contain investment advice or recommendations. Every investment and trading move involves risk, and readers should conduct their own research when making a decision.