The United States looks to avoid a catastrophic debt default after the White House and the House Republicans agreed upon a tentative deal on May 27. The U.S. equities markets rallied in anticipation of the deal on May 26 and the positive sentiment has rubbed off onto the cryptocurrency sector, which is attempting a recovery.
Buying is not limited to Bitcoin (BTC) alone as select altcoins are also showing signs of a short-term up-move. However, sustaining the rally at higher levels may prove to be difficult for the bulls.
Along with Bitcoin, what altcoins that are looking ripe for a short-term up-move? Let’s study the charts of these top five cryptocurrencies to spot the important levels to watch out for.
Bitcoin price analysis
Bitcoin has reached the overhead resistance zone between the 20-day exponential moving average ($27,146) and the support line of the symmetrical triangle. This zone is likely to witness a solid tussle between the bulls and the bears.
On the contrary, if buyers overcome the overhead obstacle and push the price back into the triangle, it will suggest strong buying on dips. That increases the possibility of a break above the resistance line of the triangle. The pair may then soar to $31,000.
The bulls will then again try to thrust the price above the channel. If they succeed, the pair may start an up-move to $28,400.
Contrarily, a break below the moving averages will suggest that the pair may extend its stay inside the channel for some more time.
XRP price analysis
XRP (XRP) has formed an inverse head and shoulders pattern, which will complete on a break and close above the neckline.
This positive view will be negated in the near term if the price turns down from the neckline and plummets below the 20-day EMA. The pair could then descend to the important support near $0.40.
If the price rebounds off the 20-EMA, it will increase the likelihood of a break above $0.48. If that happens, the pair is likely to start its up-move. Alternatively, if the price turns down and breaks below the moving averages, it will tilt the short-term advantage in favor of the bears. The pair may then drop to $0.44.
Arbitrum price analysis
The bulls pushed Arbitrum (ARB) back above the 20-day EMA ($1.17) on May 28, indicating the start of a potential recovery.
If bulls want to prevent the rally, they will have to quickly pull the price back below the 20-day EMA. If they manage to do that, the pair may slip to $1.06 and then to $1.01. This is an important zone for the bulls to defend because if it cracks, the pair may witness a sharp fall to $0.73.
Contrarily, if the price turns down and breaks back into the triangle, it will suggest that the recent breakout may have been a bull trap. The bears will then try to sink the price back toward the support line of the triangle.
Related: Institutions seek detailed blockchain analytics for crypto adoption — Elliptic
EOS Token price analysis
Eos (EOS) has been oscillating between $0.78 and $1.34 for the past several months. Generally, in such a large range, traders buy near the support and sell close to the resistance.
If the next dip finds support at the 20-day EMA, it will suggest that the bulls are on top. The pair could then rise to $1.11. The bears will have to tug the price below the vital support at $0.78 to indicate the start of a downtrend.
If buyers drive the price above $0.93, the pair could pick up momentum and rise toward the psychological level of $1 and subsequently to $1.11. This positive view could invalidate in the near term if the price turns down and breaks below the moving averages.
Aave price analysis
Aave (AAVE) has been falling inside a descending channel pattern, which generally behaves as a bullish setup.
The AAVE/USDT pair could first rise to the 50-day SMA ($70) and thereafter attempt a rally to the resistance line. A break and close above this level may start a short-term up-move.
Contrary to this assumption, if the price turns down from the current level and breaks below the 20-day EMA, it will suggest that demand dries up at higher levels. The next support on the downside is at $62.
Instead, if the price turns down from the current level, it will indicate that bears are fiercely protecting the $67.4 level. If the price slips below the moving averages, it will suggest that the pair may remain inside the triangle for some more time. A break below the triangle will invalidate the positive setup, tilting the advantage in favor of the bears.
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.
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