The S&P 500 Index (SPX) closed the week with a nominal loss of 0.29% but Bitcoin (BTC) is on target to finish the week with a deeper cut of more than 5%. The weakness in Bitcoin pulled several altcoins lower, indicating weakening sentiment.
A silver lining is Bitcoin’s solid bounce on May 12. Several analysts anticipate Bitcoin to start a recovery but monitoring resource Material Indicators sounded cautious.
In a recent analysis, they said that the lack of a strong bid from the whales at lower levels could be a concerning sign. They believe that the bullish perspective will invalidate if Bitcoin sustains below the 200-week moving average.
Crypto market data daily view. Source: Coin360
Over the next few days, the progress on the debt ceiling talks between leaders from Congress and the White House is expected to take center stage. The uncertainty and risks of a potential U.S. default could keep the rally in the equities markets under check but it is difficult to predict how Bitcoin and altcoins will react to all the chaos.
Bitcoin has started a corrective phase and most altcoins have broken below their respective support levels. Only a handful of cryptocurrencies are looking positive on the charts. Let’s analyze the chart of the top five cryptocurrencies that may turn up in the near term.
Bitcoin price analysis
The long tail on Bitcoin’s May 12 candlestick shows that the bulls are aggressively buying the dips to the neckline of the inverse head and shoulders (H&S) pattern.
BTC/USDT daily chart. Source: TradingView
Buyers will try to push the price back into the triangle but may face stiff resistance from the bears. The downsloping 20-day exponential moving average ($27,959) and the relative strength index (RSI) below 41 indicate that bears have a slight edge.
If the price turns down from the 20-day EMA, the bears will again attempt to sink the BTC/USDT pair below $25,250. If they can pull it off, the selling may intensify and the pair could crash to $20,000.
On the upside, the bulls will have to clear the hurdle at the resistance line to regain control. The pair may then retest the overhead resistance at…..