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Bitcoin faces resistance at $31,000 after the rally, thanks to continued institutional interest
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Ethereum is also on the rise, but the momentum is not as strong as that of Bitcoin
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In general, the cryptocurrency market remains volatile, and correction risks loom large
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Last week, it quickly broke above the $27,000-$28,000 resistance area. However, in the second half of the week, its momentum slowed as it reached the $29,600-$31,000 resistance area.
Heading into the weekend, Bitcoin tested the $31,000 area, revealing signs of buyer exhaustion. Currently, the bulls are struggling to cross the range between $30,500 and $31,000.
It became necessary to create a clear daily candlestick at the level of 31,000 USD to maintain its upward movement. Should this pattern emerge, the next target range to watch would be $32,600-$34,700, based on the bearish momentum seen from April to June.
Although the bullish outlook for bitcoin remains, the initial support level to watch during a possible pullback is $29,650. If the day ends below this value, this could signal the start of the recent rally correction. In this scenario, Bitcoin could drop to $28,000-$28,500 in the early stage.
Also, the stochastic RSI will confirm if a correction has started. If the index starts moving below 80, it could lead to a drop towards support levels in the near term.
Conversely, if the $28,600 support level holds, bitcoin could trade sideways in the $29,600-$31,000 range for some time.
This chart formation would sufficiently soften the RSI indicator, allowing bitcoin buyers to accumulate strength for the ensuing bullish move.
Moreover, the continued institutional interest, which has spurred Bitcoin’s recent rally, is crucial to sustaining the positive move.
In this sense, the SEC’s approval of a new Bitcoin ETF over the weekend can be interpreted as a further softening of its stance towards the cryptocurrency markets, and especially towards Bitcoin.
Moreover, the comments of the Federal Reserve Chairman, which supported last week’s rally, and with his comments on the cryptocurrency sector expected this week, the market can remain optimistic.
Thus, as long as Bitcoin stays above $29,600 this week, the upside potential is likely to continue.
Critical levels to watch in Ethereum
In early June, it fell after crackdowns by the Securities and Exchange Commission. However, it found support at Fibonacci 0.618 (1.660), which was a perfect correction level compared to the previous bullish wave.
During the second half of June, Ethereum engaged in a market-wide rally, and it broke the short-term bearish momentum by breaching the $1,825 resistance.
However, its momentum does not match that of Bitcoin.
Currently, ETH is finding resistance in the $1870-$1900 range. While the nearest resistance area is around $1945 on average, a break above this level on a daily close could put the $2030 resistance in focus.
Reclaiming the $2,000 level for ETH would mean a revival of the 2023 bullish trend, which could lead to a move towards the $2,250-$2,450 range.
However, it is more important to hold the support at $1,885. Below this level, the $1,820 average price becomes second and more important. This area corresponds to the short-term exponential moving averages and coincides with the short-term downtrend line.
If Ethereum bulls can hold the cryptocurrency above $1,800 during a potential pullback, we could see ETH breaking the resistance line and reaching the $1950 level, thus moving towards the short-term target area around the $2,000 mark.
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Disclaimer: This article was written for informational purposes only; It does not constitute a solicitation, offer, advice, advice or recommendation to invest, and is not intended to encourage the purchase of assets in any way.
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