Bitcoin (BTC) experienced a roller coaster ride in 2021. Despite a sharp correction from its all-time high of $69,000, the digital asset is still up by 60% year to date. During the same period, gold fell by more than 5%.
With inflation raging in the United States and other parts of the world, Bitcoin’s outperformance over gold suggests that investors may view it as a better hedge against inflation than gold.
The total crypto market capitalization increased to around $3 trillion this year. However, Bitcoin’s dominance fell from about 70% at the start of the year to 40%.
Bitcoin (BTC) broke and closed above the overhead resistance level of $64,854 in early November. However, the candlestick’s long wick indicates profit-taking at higher levels. The selling continued the following week, falling below $64,854. The bulls attempted to defend the 20-week exponential moving average (EMA) ($51,999), but the rebound was short-lived. The bulls bought the dip but could not extend the rally above the 20-week EMA.
The bulls will now make one more attempt to clear the psychologically significant $5,000 overhead hurdle. If they are successful, the ETH/USDT pair may begin the next leg of the uptrend, with the first target at the 100 percent Fibonacci extension level of $5,719.68.
If the price rises above this level, the next target to watch is the 138.2 percent Fibonacci extension level at $6,566.19, followed by the 161.8 percent extension level at $7,089.17.
In contrast to this assumption, a price decline from the current overhead resistance level and a break below the 20-week EMA will indicate that traders are selling on rallies.
Due to the upsloping moving averages and the RSI being in the positive zone, buyers have the upper hand.
If the price rises from its current level, the BNB/USDT pair could reach the overhead zone of $669.30 to $691.80.
If this occurs, the pair could begin the next leg of the uptrend at $848.30 before attempting a rally to $1,171.90.
Another possibility is that the price bounces off the 20-week EMA but reverses and retests the overhead resistance. In this case, the pair could remain range-bound for a few weeks.
The sharp rally of Avalanche (AVAX) to an all-time high of $147 had pushed the RSI close to the 85 levels. Short-term traders may have profited as a result of this. The strong rebound of the 20-EMA ($73) indicates that sentiment is still positive, and traders are buying on dips. The bulls will now try to push the price to its all-time high of $147.
Polygon’s MATIC has been rising. The bulls attempted but failed to push the price above the all-time high of $2.70. It suggests that bears are aggressively defending the overhead resistance. On the other hand, Bulls are buying dips to the 20-week EMA ($1.62). It indicates that traders are accumulating on dips and that sentiment remains bullish.
Rising moving averages and an RSI close to the overbought zone indicate that the path of least resistance is to the upside. The bulls will attempt to push the MATIC/USDT pair above $2.70 once more.
If they succeed, the pair could enter the next leg of the uptrend, which could take it to $3.28.
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