Bitcoin and Altcoins Experience Sharp Correction
Bitcoin (BTC) saw a sharp correction, falling near $40,500 after closing the previous week with gains of 9.55%. This correction also led to liquidations in several altcoins, with cross-crypto long liquidations for Dec. 11 exceeding $300 million.
However, this correction does not change the overall trend in Bitcoin and altcoins. Corrections are normal in any uptrend, as they allow long-term investors to buy at lower levels. In 2024, several bullish catalysts are expected, including the potential approval of Bitcoin exchange-traded funds in January, the Bitcoin halving in April, and a possible rate cut by the United States Federal Reserve later in the year.
S&P 500 Index Price Analysis
The S&P 500 Index (SPX) has been holding above the breakout level of 4,541, indicating buyer support. The upward momentum is supported by the upsloping 20-day exponential moving average (4,531) and the relative strength index (RSI) near overbought levels. If buyers break through the resistance at 4,650, the index could gain momentum and surge to 4,800. However, a drop below the 20-day EMA could indicate aggressive selling and lead to a decline to the 50-day simple moving average (4,393).
U.S. Dollar Index Price Analysis
The U.S. Dollar Index (DXY) bounced off the 61.8% Fibonacci retracement level of 102.55 on Nov. 29, suggesting buying at lower levels. The current rally faces resistance at the 20-day EMA (104), but if this level is surpassed, the index could rise to the 50-day SMA (105). The flattening 20-day EMA and the RSI near the midpoint indicate a range formation in the near term. Strong support is found at 102.46.
Bitcoin Price Analysis
Bitcoin experienced a sharp pullback after consolidating near $44,700. However, it rebounded off the 20-day EMA ($40,708), indicating buyer interest. The BTC/USDT pair may face resistance at $44,700, but a breakout above this level would suggest a bullish trend. On the downside, a drop below the 20-day EMA could deepen the correction to $37,980.
Ether Price Analysis
Ether (ETH) saw a decline after reaching $2,403 on Dec. 9 and breaking below the breakout level of $2,200 on Dec. 11. The price action formed a negative divergence on the RSI, signaling weakening bullish momentum. However, buyers are defending the 20-day EMA ($2,186). If the price bounces from this level, they will aim to push the ETH/USDT pair above $2,403 and potentially rally to $2,500 and $3,000. A close below the 20-day EMA could invalidate this view and lead to a deeper correction towards the 50-day SMA ($2,012).
BNB Price Analysis
BNB witnessed an outside-day candlestick pattern on Dec. 11, indicating a battle between bulls and bears. Aggressive buying at lower levels is evident from the long tail on the candlestick. If BNB maintains support above $239.2, it could gain momentum and rise to $265. However, breaking below $223 would favor bears and may lead to a decline to the pivotal support at $203.
XRP Price Analysis
XRP rose above the $0.67 resistance but faced selling pressure, resulting in a sharp pullback below the 50-day SMA ($0.62) on Dec. 11. A close below this level could push the XRP/USDT pair to the crucial support at $0.56. If buyers drive the price higher, they will aim to overcome the obstacle at $0.67 and potentially reach $0.74, where strong resistance is expected.
Solana Price Analysis
Solana is facing selling pressure at the overhead hurdle of $78, which triggered a pullback on Dec. 11. However, buyers are finding support at the 20-day EMA ($63), indicating continued interest at lower levels. If they sustain a rebound, the SOL/USDT pair could retest the high at $78 and potentially rally to $100. On the other hand, breaking below the 20-day EMA may lead to a deeper correction towards the crucial support at $51.
Cardano Price Analysis
Cardano broke above the overhead resistance of $0.60 but failed to maintain higher levels, leading to a pullback on Dec. 11. The RSI suggests that the rally was overextended in the near term, prompting short-term bulls to book profits. The ADA/USDT pair is seeking support at the 50% Fibonacci retracement level of $0.51, and if it holds, buyers may attempt another push towards the local high at $0.65. A break below $0.51 could bring further downside towards the 20-day EMA ($0.45).
Dogecoin Price Analysis
Dogecoin’s rally at $0.11 is being challenged by bears, as seen from the long wick on the Dec. 11 candlestick. The price may pull back to the 20-day EMA ($0.09), a critical level to watch. A strong bounce from this level would suggest positive sentiment and increase the chances of a break above $0.11, potentially pushing the DOGE/USDT pair to $0.15. However, a drop below the 20-day EMA could indicate aggressive profit-taking and lead to further decline towards the 50-day SMA ($0.08).
Avalanche Price Analysis
Avalanche has been in a strong uptrend but showed signs of a possible correction or consolidation on Dec. 11. Buyers are defending support at $31, which increases the likelihood of a rally above $38 and potential gains towards $46 and $50. However, if the price falls below $31, it may indicate a deeper correction towards the 20-day EMA ($25.85).
Hot Take: Bitcoin and Altcoins Experience Temporary Correction Amid Bullish Catalysts
The recent sharp correction in Bitcoin and altcoins should not deter long-term investors, as corrections are normal in any uptrend. The overall trend remains positive due to several bullish catalysts expected in 2024, including potential Bitcoin ETF approvals, the Bitcoin halving, and a possible rate cut by the US Federal Reserve. While short-term volatility may continue, key support levels can help determine potential buying opportunities for traders.
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