BTC and many altcoins are rapidly approaching a “surrender phase” which is usually followed by a market bottom.
On May 9, global stock markets continued to fall, with the S&P 500 falling to a new 52-week low. Bitcoin (BTC) fell to a new yearly low and most of the major altcoins continued to fall, tracking the weakness of the stock markets.
Data from analytics firm Glassnode shows that bitcoin inflows to centralized exchanges have surged to more than 1.7 million coins, the highest since February. This suggests that the whales may lose their holdings as they expect the downtrend to continue.
Daily dynamics of the cryptocurrency market. Source: Coin360
Some analysts expect crypto markets to enter a capitulation phase that usually marks a bottom. Analyst Dylan Leclerc emphasized that previous market lows happened during bear markets when bitcoin fell to its strike price (average value on the network). The figure is currently $24,300.
Can bitcoin and altcoins enter a capitulation phase, or is it time for crypto markets to surprise many with a strong recovery? Let’s examine the charts of the top 10 cryptocurrencies to find out.
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Bitcoin fell below the rising channel on May 5 and continued to decline, which suggests that the bears are not in the mood to give up their advantage. The price has broken through critical support at $32,917, but bulls at lower levels could face a major bear challenge.
BTC/USDT daily chart. Source: Trading View
If the price recovers from current levels, the recovery rally could reach the 20-day exponential moving average (EMA) ($37,670). This is an important level to keep an eye on because if the price deviates from the 20-day EMA, it will mean sentiment remains negative and traders will sell on the rally.
The bears will then make another attempt to pull the BTC/USDT pair towards the critical support at $28,805. This level is likely to attract new buying from the bulls.
On the other hand, a break and close above the 20-day EMA would be the first sign that selling pressure may ease. This could pave the way for a possible rally towards the 50-day Simple Moving Average (SMA) ($41,279).
Ether (ETH) broke below the uptrend line on May 7th. This move invalidated the developing ascending triangle pattern. A breakout of a bullish pattern is usually a bearish sign as stops are triggered by several bulls that may have bought in anticipation of a breakout of the pattern.
Daily ETH/USDT chart. Source: Trading View
Strong selling pushed the price below immediate support at $2,445. This opens the door for a possible fall towards the $2300-$2159 critical support zone. The bulls are likely to defend this zone with all their might as a break below it could send ETH/USDT down to $1,700.
If the price recovers from the support zone, the bulls will try to push the pair above the 20-day EMA ($2,790). If they succeed, it means that the bears may lose their balance. The pair could then rise to the 50-day SMA ($3,043).
BNB has shown solid selling over the past few days. The bears pushed the price below the strong $350 support and are now challenging the critical $320 level.
BNB/USDT daily chart. Source: Trading View
A break and close below $320 would be a big draw as this level has not been broken since August 2021. Minor support lies at $300, but if that level fails to stem the decline, BNB/USDT could drop to $250.
Alternatively, if the price recovers from $320, the bulls will try to push the pair above $350 and challenge the 20-day EMA ($383). Buyers must overcome this hurdle to signal that the decline may be over. The pair could then rise to the 50-day SMA ($409).
Ripple (XRP) cut off the 20-day EMA ($0.63) on May 5 and fell below $0.62. Buyers tried to push the price above $0.62 on May 6, but the bears held out.
Daily XRP/USDT chart. Source: Trading View
The XRP/USDT pair continued its decline and is below the support at $0.55.