Price analysis 5/22: SPX, DXY, BTC, ETH, BNB, XRP, ADA, DOGE, SOL, MATIC
Bitcoin’s tight-range trading suggests that traders are content to wait for a catalyst to start the next trending move.
Bitcoin has been trading in a narrow range for the past few days. Generally, tight ranges are followed by a range expansion, resulting in strong trending moves. Market intelligence firm Glassnode tweeted on May 22 that Bitcoin’s (BTC) seven-day price range is “comparable to Jan 2023 and July 2020, both of which preceded large market moves.”
It is not only Bitcoin — even the S&P 500 Index (SPX) is at a critical juncture. After its 1.65% rise last week, the SPX has reached near a stiff resistance. The market participants will be keenly watching the outcome of the debt ceiling negotiations before attempting to start a trending move.
Another trigger could be the macroeconomic data, as it will provide insights on the likely action by the United States Federal Reserve in its next meeting on June 13 and 14. The FedWatch Tool currently projects a 72% probability of a pause by the Fed.
What are the important support and resistance levels that need to be crossed to signal the start of a new trending move on Bitcoin and the major altcoins? Let’s study the charts to find out.
S&P 500 Index price analysis
The bulls pushed the SPX above the 4,200 resistance on May 19, but they could not sustain the higher levels. This shows that the bears are fiercely protecting this level.
However, the 20-day exponential moving average (EMA) at 4,140 is sloping up gradually, and the relative strength index (RSI) is in the positive zone, indicating that bulls are in control. They are likely to make another attempt to overcome the hurdle at 4,200.
If they succeed, it will complete a bullish ascending triangle pattern. The index could first rise to 4,300 and thereafter to 4,600.
The moving averages are the important support levels to watch out for on the downside. A break below the 50-day simple moving average (SMA) at 4,080 will be the first indication that the bulls may be rushing to the exit. That could pull the price down to the uptrend line.
U.S. Dollar Index price analysis
The U.S. Dollar Index (DXY) has been range-bound between 100.82 and 106 for the past several days. In a range, traders generally buy near the support and sell closer to the resistance.
The repeated failure of the bears to sink the price below 100.82 may have attracted buying from the aggressive bulls. They kicked the price above the moving averages on May 12, paving the way for a potential rally to 106. This level may act as a formidable resistance, and the bulls may find it difficult to surmount it.
On the downside, a break below the moving averages will be the first indication that the bears are selling on minor rallies. That could result in a retest of the pivotal level at 100.82.
Bitcoin price analysis
The bears have successfully defended the 20-day EMA ($27,414), but they have not been able to sink the price to the crucial support at $25,250. This suggests that the bulls are buying on minor dips.
As long as the price stays above the nearby support at $26,361, the bulls will continue their efforts to push the price back into the symmetrical triangle pattern. If they manage to do that, it will suggest that the markets have rejected the lower levels.
That could increase the likelihood of a rally to the resistance line. This level may again prove to be a major hurdle for the bulls.
Contrary to this assumption, if the price turns down and breaks below $26,361, it will suggest that supply exceeds demand. The BTC/USDT pair could then tumble to the critical level of $25,250.
Ether price analysis
Ether (ETH) has been trading close to the 20-day EMA ($1,833) for the past few days. Although the bears have defended the level successfully, the bulls have kept up the pressure. This enhances the prospects of a break above the 20-day EMA.
If that happens, the ETH/USDT pair could rise to the resistance line of the falling wedge pattern. This level may again act as a strong barrier, but if bulls overcome it, the pair could start an up move to $2,000 and subsequently to $2,141.
Conversely, if the price turns down and breaks below $1,771, the pair may drop to the support line. This is an important level for the bulls to defend because a break below it is likely to result in a drop to $1,600.
BNB price analysis
BNB (BNB) has been trading between the 20-day EMA ($313) and the horizontal support at $300 for the past few days.
The downsloping 20-day EMA and the RSI near 44 suggest that the bears have a slight edge. Sellers will try to sink the price below $300 and challenge the support line of the descending channel pattern.
On the contrary, if the price turns up from the current level and breaks above the moving averages, it will suggest that bulls are attempting a comeback. The BNB/USDT pair may then rise to the resistance line of the channel.
XRP price analysis
The bulls have failed to propel XRP (XRP) above the downtrend line, but a minor positive is that they have held the 20-day EMA ($0.45) support on the downside. This shows that the sentiment is turning bullish and the dips are being bought.
The 20-day EMA has started to turn up gradually, and the RSI is in the positive zone, indicating that the path of least resistance is to the upside. If buyers propel the price above the 50-day SMA ($0.47), the XRP/USDT pair could pick up momentum and dash toward $0.54.
This positive view will be invalidated in the near term if the price turns down and slips below the 20-day EMA. That could clear the path for a drop to the critical support zone of $0.43 to $0.40.
Cardano price analysis
Cardano (ADA) continued its slide in the past three days and reached the uptrend line on May 21. This is an important level to watch for because a break below it will indicate that the bulls are losing their grip.
The solid bounce off the uptrend line on May 22 shows that the buyers continue to protect this level with all their might. If bulls propel the price above the 20-day EMA ($0.37), it will suggest that the selling pressure is reducing. The ADA/USDT pair is likely to pick up momentum above the 50-day SMA ($0.39).
Instead, if the price once again turns down from the 20-day EMA and breaks below the uptrend line, it will indicate the start of a deeper correction to $0.30.
Related: Why is Bitcoin price stuck?
Dogecoin price analysis
Dogecoin (DOGE) turned down from the 20-day EMA ($0.07) on May 21, but the bulls continue to buy the dips to $0.07, indicating that the price remains stuck inside the range.
The bears will try to strengthen their position by yanking the price below the solid support at $0.07. If they can pull it off, the DOGE/USDT pair may slump to $0.06, where the buyers will again try to arrest the decline.
Contrarily, if bulls thrust the price above the 20-day EMA, it will suggest that range has resolved in favor of the buyers. The pair could first reach the 50-day SMA ($0.08) and later attempt an up move to $0.10.
Solana price analysis
Solana (SOL) turned down and plunged below the strong support of $19.85 on May 21, indicating that bears remain in command.
The SOL/USDT pair could decline to $18.70, which is an important level to keep an eye on because if this level cracks, the pair may descend to the crucial support at $15.28. This level is likely to attract strong buying by the bulls.
On the upside, a rally above the moving averages will suggest that the selling pressure is reducing. That will open the doors for a potential rally to $24 and then to $27.12. Sellers will try to halt the recovery at this level.
Polygon price analysis
Polygon (MATIC) has been oscillating in a narrow range between $0.91 and $0.82 for the past few days. This suggests that traders are unsure about the next directional move.
The downsloping moving averages and the RSI below 39 indicate that the bears are in command. Sellers will try to sink the price below $0.82 and resume the downtrend. The MATIC/USDT pair could then retest the vital support at $0.69. Buyers are expected to aggressively defend this level.
If bulls want to start a recovery, they will have to drive the price above the $0.91 to $0.94 resistance zone. The pair could then start a strong relief rally toward the resistance line.
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.
This article is for general information purposes and is not intended to be and should not be taken as legal or investment advice. The views, thoughts, and opinions expressed here are the author’s alone and do not necessarily reflect or represent the views and opinions of Cointelegraph.