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Bitcoin lost ground near the $55,000 mark, sparking the largest liquidation in crypto market history. Given the current dire situation, it is important to find and highlight thresholds that could provide grounds for a reversal in the near future.
Bitcoin's first significant support level is likely to be between $52,000 and $50,000. This range is important due to the psychological effect of whole numbers. Additionally, historical evidence shows that this range has previously acted as both resistance and support, making it crucial for a possible reversal.
Analyzing the weekly chart, we can see that the $47,000 level is crucial. This level coincides with the weekly 200 EMA and is associated with the previous consolidation phase. According to many, the 200 EMA is a long-term support level, and a bounce from this level could give Bitcoin the momentum it needs to rise again.
If Bitcoin were to fall from this level, it could be a sign of a more significant correction. The next support zone to watch is the $42,000-$40,000 range. Historically, this area has acted as a solid support level and has been the foundation for significant corrections. Its importance is heightened as the 200 EMA on the daily chart is also located within this range. Holding this level could prevent a further significant decline and even pave the way for a rebound.
Toncoin's biggest drop
Toncoin (TON) experienced perhaps the largest percentage price drop in a 48-hour period. The Telegram-backed asset lost roughly 20% of its value, plummeting from around $8 to $6.6, essentially wiping out all of its gains since the start of the month.
There are a few reasons why TONCOIN has plummeted in value. Firstly, the bearish sentiment across the market has resulted in a large sell-off across many cryptocurrencies. Bitcoin recently fell below a key support level, which has negatively impacted the market, including TONCOIN.
Analysis of technical indicators shows that the price of TON has risen above the 50 EMA and is currently hovering around the 100 EMA, which has been a strong support level in the past but the intensity of the recent selling pressure raises concerns that it may not hold this time.
Moreover, the Relative Strength Index (RSI) has declined notably, suggesting that Toncoin is approaching oversold territory. The overall bearish momentum could see the price continue to fall, despite the possibility of a temporary upswing.
The source of Solana's unexpected strength
The only unexpected thing about this devastating market drop is the strong rise of one of the assets that was expected to follow the market more than others: Solana has been showing positive movement against Ethereum, which could be a signal that cannot be ignored.
Solana’s recent performance has been impressive, especially considering the overall market pessimism: Solana managed to achieve an 8% gain amidst major declines in major assets like Ethereum and Bitcoin.
This suggests that underlying bullish factors exist and investor confidence is strong. Observing the daily chart, Solana is now targeting the 100 EMA after rising above the key resistance level of the 50 EMA. This uptrend is particularly noteworthy as it stands in stark contrast to Ethereum's downward trajectory.
Moreover, there appears to be growing buying pressure and momentum supporting Solana’s price movement, as indicated by the rising Relative Strength Index (RSI).However, it is important to keep in mind that Solana is still losing value against the US Dollar.
About the Author
Armand Sirignan
