Bitcoin fell 56.2% in the second quarter of 2022, according to crypto analytics platform Coinglass. This makes it the worst quarter for Bitcoin since the third quarter of 2011 when the price of Bitcoin dropped 67%. Much of the damage came in June when Bitcoin plunged 37%, the worst monthly decline since September 2011.
It’s not all doom and gloom for cryptocurrency investors. On June 29, Nikolaos Panegirzoglu, a strategist at JPMorgan, said that the “net leverage metric” indicates that the devaluation of cryptocurrency may be in its final stages. The eagerness of crypto firms with strong balance sheets to bail out crypto firms in distress is also a positive sign.
Daily cryptocurrency market performance. Source: Coin360
Another positive view of Bitcoin came from Deutsche Bank analysts. In a recent report, strategists said the S&P 500 could regain lost ground and rise to levels seen in January. This could benefit Bitcoin as it is closely related to the S&P 500 Index.
Can the downtrend resume or lower levels attract buyers? Let’s study the charts of the top 10 cryptocurrencies to find out.
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BTC / USDT
Bitcoin dropped below the immediate support at $19,637 on June 30, but the long tail on the candle indicates a strong buying at the lower levels. The bulls attempted to build on the momentum on July 1 and pushed the price towards the upper resistance at $22,000, but the long wick on the candle shows that the bears are active at higher levels.
BTC/USDT daily chart. Source: TradingView
If the price maintains below $19,637, the probability of a retest of the critical support at $17,622 increases. The downward sloping moving averages and the oversold RSI indicate that the bears are in control.
A breakout and a close below $17,622 may signal a resumption of the downtrend. The next support is $15,000.
This negative view could be invalidated in the short term if the price rises above the 20-day exponential moving average (EMA) ($21,907). Such a move could pave the way for a possible rally to the 50-day simple moving average (SMA) ($26,361).
ETH / USDT
Ether (ETH) fell below the immediate support of $1,050 on June 30, but the bulls bought the decline. Buyers attempted to extend the recovery on July 1, but the long wick on the candle shows that the bears are selling at slight highs.
ETH/USDT daily chart. Source: TradingView
The bears will attempt to pull the price below the psychological level of $1,000. If they succeed, the selling could gain momentum and the ETH/USDT pair could drop to the important support level at $881. If this level declines, the pair may resume the downtrend. Next support is at $681.
Contrary to this assumption, if the price rebounds from the current level or $1,000, the bulls will try to push the pair above the 20-day moving average. If they manage to pull it off, this will indicate that the bears may lose their grip. Bullish momentum may increase on a break above $1,280.
BNB / USDT
BNB fell below the strong support at $211 on June 30, but the lower levels attracted strong buying as evidenced by the long tail on the candlestick today.
BNB/USDT daily chart. Source: TradingView
Buyers attempted to extend the recovery on July 1, but the long wick on the candlestick shows that the bears are defending the 20-day EMA ($234) aggressively. The 20-day exponential moving average and the RSI in negative territory indicate the advantage of the sellers.
If the price continues below $211, BNB/USDT could retest the crucial support at $183. If this support is broken, the downtrend may resume. The next support is $150.
This negative opinion can be invalidated in the short term if the price rises and breaks above the 20 day moving average. That could pave the way for a possible rally to the 50-day simple moving average ($271).