Key Points:
Bitcoin's rebound from the moving average may improve market sentiment, driving BNB, SOL, LINK, and AAVE to break through their upper resistance levels.
Bitcoin's failure to close above $110,000 may have attracted profit-taking from short-term traders, bringing the price closer to $108,000. Crypto analyst Daan Crypto Trades stated in a post on X that a close above $110,000 would be beneficial for Bitcoin, but a drop below $108,000 could deepen the correction.
Some analysts are betting that former President Trump's "Big and Beautiful Plan" will act as a catalyst for prices to break through historical highs. Prediction service Kalshi expects U.S. national debt to reach $40 trillion by 2025, a significant increase from $23.2 trillion in 2020. History shows that increased U.S. borrowing has driven Bitcoin prices up. For example, after Trump signed the COVID-19 spending bill at the end of 2020, Bitcoin's price surged by about 38%.
Although most analysts remain bullish on the continuation of the bull market, crypto analyst Rekt Capital warned in a recent video that if Bitcoin follows the pattern of 2020, the bull market may only last another two to three months.
Can Bitcoin rebound from the support level and drive some altcoins higher? Let's analyze the charts of the top five cryptocurrencies that are performing strongly.
Buyers attempted to push Bitcoin above the resistance level of $110,500 on Thursday (July 3), but the bears held their ground.
Sellers have pulled the price back below the descending trend line, which is a negative signal. Buyers are expected to fiercely defend the moving average, as failure to do so could see the BTC/USDT pair drop to $105,000, followed by a decline to the psychological support level of $100,000.
Conversely, if the price rebounds significantly from the moving average, it indicates positive market sentiment. This increases the likelihood of the price rising to the historical high of $111,980, and then reaching the neckline of the inverse head and shoulders pattern at $113,500.
The pair has dropped to the 50 simple moving average (SMA) on the four-hour chart, and bulls are trying to prevent a pullback. If the price recovers from the current level and breaks above the descending trend line, it indicates demand at lower levels. Bulls will again attempt to push the pair above $110,500. If successful, the price could rise to $113,500.
On the other hand, if the price remains below the 50-day SMA, it indicates that short-term buyers are taking profits. The pair could then drop to $105,000. Buyers are expected to defend the $105,000 level vigorously, as a close below it could extend the decline to $100,000.
BNB rebounded from the breakout level on Wednesday (July 2) and broke above the 50-day SMA ($654).
Bears are trying to pull the price back below the moving average, but bulls are expected to defend this level. If the price rebounds from the moving average and breaks above $665, the BNB/USDT pair could rise to $675. Sellers will again attempt to stop the rise at $675, but if bulls prevail, the pair could reach $698.
If the price drops below the moving average and re-enters the descending channel, this optimistic view will be negated in the short term. This indicates that the market has rejected the breakout above the channel.
Bears have pulled the price down to the 50-day SMA on the four-hour chart. The flattening 20-day exponential moving average (EMA) and the relative strength index (RSI) slightly below the midpoint fail to give a clear advantage to either bulls or bears.
Buyers must push the pair above $665 to gain the upper hand. The pair could then rise to $675, followed by $698. Alternatively, a drop below the moving average indicates that bulls are losing control. The pair could then drop to $640.
Solana (SOL) bulls have repeatedly failed to break through the barrier at $159, leading to a pullback below the 20-day EMA ($148).
The flattening 20-day EMA and the RSI slightly below the midpoint indicate a balance of supply and demand. If buyers push the SOL/USDT pair above $159, they will regain control. This paves the way for a rise to $168, and then to $185.
Conversely, a close below the 20-day SMA indicates that bears have overwhelmed the bulls. The pair could drop to the critical support level of $140. This is an important level that bulls must defend, as a drop below it could push the pair down to $126.
The failure of bulls to defend the 50-day SMA on the four-hour chart is a negative signal. The pair could drop to $145, which is an important level to watch. If the price rebounds strongly from $145, it indicates buying on dips. Bulls will attempt to push the pair up to $159. A close above $159 will complete a bullish inverse head and shoulders pattern, targeting $192.
Conversely, a drop below $145 could push the pair down to $137. Buyers are expected to defend the $137 level vigorously, as a drop below it could push the pair down to $130.
Chainlink (LINK) broke above the 20-day EMA ($13.32) on Wednesday, but bulls failed to break above the 50-day SMA ($14.09) on Thursday. This indicates that bears are active at higher levels.
The LINK/USDT pair could drop to $12.73, which is an important level to watch. If the price rebounds strongly from $12.73, bulls will again attempt to push the pair above the 50-day SMA. If successful, the pair could surge to $15.66, and then to $18.
In contrast, if the price continues to decline and drops below $12.73, it indicates that bears are trying to take control. A drop and close below $12.73 could push the pair down to $11.
The pair's failure to maintain above the resistance line indicates that bears are trying to trap aggressive bulls. The pair could drop to $12.73, where bulls are expected to defend strongly. If the price rebounds from $12.73, bulls will again attempt to push the pair above $14.10. If successful, the pair could rise to $15.77.
Conversely, a drop and close below $12.73 could accelerate selling. The pair could then drop to $11.50.
Aave (AAVE) faces resistance at $286, but a positive sign is that bulls have not allowed the price to drop below the moving average.
The rising moving average indicates that buyers are in control, but the RSI near the midpoint suggests that bullish momentum is weakening. If the price rebounds strongly from the moving average, bulls will attempt to push the AAVE/USDT pair above $286. If successful, the pair could jump to $325.
If the price continues to decline and drops below the moving average, this positive view will be negated. This indicates that bulls have given up. The pair could drop to $240, followed by $220.
The pair's drop from $286 indicates that bears are actively defending this level. If the price rebounds from the ascending trend line and breaks above the 20-day EMA on the four-hour chart, it indicates strong demand at lower levels. Bulls will again attempt to push the pair above $286. If successful, the pair could rise to $295, and then to $310.
A drop below the ascending trend line indicates that bulls are losing control. The pair could then drop to $248, which is a key support level to watch. If the $248 level is lost, the pair could plummet to $220.
Related: Why can't Bitcoin's price break through the historical high of $112,000? BTC analysts explain the reasons.
Original article: “Bitcoin (BTC) Faces Resistance at $110,000, but BNB, SOL, LINK, and AAVE Show Potential”
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