Bitcoin reclaims $28K, and charts suggest ARB, XRP, EOS and AAVE could follow



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.



Crypto market data daily view. Source: Coin360

After the debt ceiling deal, traders are likely to focus their attention on the Federal Reserve’s rate hikes. The hot Personal Consumption Expenditures data on May 26 increased the likelihood of a rate hike at the Fed’s June meeting. The probability of a 25 basis point rate hike has risen from 17% a week back to 64% on May 28, according to the CME FedWatch Tool.

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.



BTC/USDT daily chart. Source: TradingView

If the price turns down from the overhead zone, the bears will make another attempt to yank the price to the pivotal support at $25,250. The bulls are expected to defend the zone between $25,250 and $24,000 with all their might because a break below it could intensify selling. The BTC/USDT pair could then tumble to $20,000.

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.



BTC/USDT 4-hour chart. Source: TradingView

The 4-hour chart shows that the pair is trading inside a descending channel pattern and the bears are trying to defend the resistance line. If the price turns down from the current level but rebounds off the 20-EMA, it will indicate that dips are being bought.

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.



XRP/USDT daily chart. Source: TradingView

The 20-day EMA ($0.45) is sloping up gradually and the RSI has jumped into positive territory, indicating that the path of least resistance is to the upside. If bulls drive and sustain the price above the neckline, the XRP/USDT pair could start a rally to the overhead resistance zone between $0.54 and $0.58. The pattern target of the bullish setup is $0.55.

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.



XRP/USDT 4-hour chart. Source: TradingView

The 4-hour chart shows that the pair is witnessing a tough battle between the bulls and the bears near the neckline. The rising 20-EMA and the RSI in the positive zone indicate a minor advantage to the buyers.

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.



ARB/USDT daily chart. Source: TradingView

The bears are likely to pose a strong challenge at $1.20 but if bulls pierce this level, the ARB/USDT pair could pick up momentum. There is a minor resistance at the 50-day simple moving average ($1.29) but it is likely to be crossed. The pair may then climb to $1.36 and later to $1.50.

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.



ARB/USDT 4-hour chart. Source: TradingView

The 4-hour chart shows that the bulls have pushed the price above the resistance line of the symmetrical triangle pattern. The bears are trying to stall the up-move at $1.20 but if the bulls do not allow the price to re-enter the triangle, it will enhance the prospects of an upside breakout. The pattern target of the setup is $1.43.

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.



EOS/USDT daily chart. Source: TradingView

The EOS/USDT pair bounced off $0.81 on May 25 and rose above the 20-day EMA ($0.89) on May 28. This is the first indication that the range remains intact. The bulls will try to push the price to the 50-day SMA ($1) where the bears are likely to mount a strong defense.

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.



EOS/USDT 4-hour chart. Source: TradingView

The recovery attempt is facing selling near the overhead resistance at $0.93 but the bulls have not given up much ground. The moving averages have completed a bullish crossover and the RSI is near the overbought zone, indicating that bulls have the upper hand.

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.



AAVE/USDT daily chart. Source: TradingView

After struggling near the 20-day EMA ($65.50) for the past few days, the bulls pushed the price above the resistance on May 27. This suggests the start of a possible relief rally.

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.



AAVE/USDT 4-hour chart. Source: TradingView

The 4-hour chart shows the formation of an ascending triangle pattern which will complete on a break and close above $67.40. The pair could then start an up-move toward the pattern target of $74.

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.


Title: Bitcoin reclaims $28K, and charts suggest ARB, XRP, EOS and AAVE could follow
Sourced From: cointelegraph.com/news/bitcoin-reclaims-28k-and-charts-suggest-arb-xrp-eos-and-aave-could-follow
Published Date: Sun, 28 May 2023 23:25:52 +0100