Bitcoin (BTC) bulls are likely to remain firm as the verdict on the BTC spot ETF nears. Analysts predict the US Securities and Exchange Commission will make a decision on Bitcoin ETF applications between January 8 and January 10.
Will Bitcoin skyrocket if one or more Bitcoin spot ETFs are approved? That is the central question in investors’ minds. Bitcoin prices may spike following ETF approval, but after the initial excitement, traders may begin to take profits in a classic case of “buy the rumor, sell the truth.”
If regulators do not approve a spot Bitcoin ETF, a sharp sell-off could occur. However, the start of a bear market is unlikely as traders will quickly shift their focus to Bitcoin’s halving in April, limiting the downside. Additionally, news that a Bitcoin ETF will eventually be approved could send bulls back to lower levels.
If Bitcoin remains positive, select altcoins are likely to continue their uptrend. Let’s look at the chart of the top 5 cryptocurrencies that could do better in the near term.
BTC technical analysis
Bitcoin formed a Doji candlestick pattern on January 5 and an inside bar candlestick pattern on January 6, showing indecision between bulls and bears.
However, a positive sign is that the price is still within the ascending triangle pattern. This bullish setup will complete on a breakout and close above $44,700. If that happens, the BTC/USDT pair could start the next leg of the uptrend towards the pattern’s target at $49,178 and then $52,000.
The support line of the triangle is an important level to pay attention to in a downtrend. If this level gives way, the pair could drop to $40,000 and eventually to $37,980. Buyers are likely to defend this level strongly.
The 20 exponential moving average is flat and the relative strength index (RSI) is just above the midpoint, suggesting balance between buyers and sellers. Bullish momentum is likely to pick up on a close above $44,700. There is a minor resistance at $45,879, but if this level is conquered, the possibility of a rise to $49,178 increases.
On the other hand, a break below the 50 simple moving average will show that the bulls are tiring. The pair could then drop to the support line of the triangle. The buyers will have to defend this level if they want to keep the bullish pattern intact.
ICP technical analysis
Internet Computer (ICP) has been in a sharp pullback for several days, showing that the bulls are in a hurry to exit.
The bulls will try to arrest the correction at the 20-day EMA ($11.18). If the price bounces strongly from the 20-day EMA, it will show that sentiment remains positive and traders are buying at low prices. The bulls will then make another attempt to push the ICP/USDT pair to $14.40 and eventually $16.
The risk to this assumption is that the RSI has formed a bearish divergence, indicating weakening momentum. A break and close below the 20-day EMA would signal that the uptrend could end shortly.
The moving averages have completed a bearish cross and the RSI is trading in the negative zone, suggesting that the short-term trend is tilted towards the bears. If the price slips below $11.70, the pair could drop to $11 and then to $9.36.
The bulls will have to push and sustain the price above the moving averages to signal that the correction may be over. That could start to rise to $15 and then $16. This level could once again attract strong selling from the bears.
ARB technical analysis
Arbitrum (ARB) failed to sustain above $2, which may have attracted short-term traders to take profits. That dragged the price down to the breakout level of $1.75.
The ARB/USDT pair is likely to witness a tough battle between buyers and sellers near the $1.75 level. If the price rallies sharply from $1.75, it will show that the bulls have turned this level into support. This move would increase the likelihood of a retest of the January 4 high of $2.11. A break above this level could start the next leg of the uptrend to $2.50.
Instead, if the $1.75 level breaks, the pair could drop to the 20-day EMA ($1.59). The bulls will have to fiercely defend this level as a slide below it could start a decline towards $1.35.
The pair has bounced from the $1.75 support but is facing strong resistance at the 20 EMA. This is a negative sign as it shows that traders are viewing the rallies as an opportunity sold out. The bears will try to consolidate their position by dragging the price below the 50 SMA. If successful, the pair can drop to $1.50.
If the buyers want to stop the decline, they will have to quickly push the price above the 20 EMA and then the overhead resistance at $1.96. That could set up a retest of the $2.12 resistance level.
STX technical analysis
Stacks (STX) turned down from resistance at $1.78 on Jan. 5, but the pullback was short-lived.
The price turned up from the 20-day EMA ($1.47) on Jan. 6, showing that bulls continued to buy on dips. The bulls have pushed the price to the $1.78 resistance level, where they are likely to encounter strong selling by the bears. If buyers overcome the above barrier, the STX/USDT pair could rise to $2.20 and then $2.50.
Conversely, if the price turns down sharply from the current levels, the pair could fluctuate between the 20-day EMA and $1.78 for a while. The bears will have to drag the price below the 20-day EMA to initiate a deeper correction to $1.20.
The pair has reached the $1.78 resistance level, which remains an important short-term level to watch. If buyers overcome this barrier, it will signal the start of the next leg of the uptrend. The pair could then begin its journey towards $2.
Conversely, if the price turns down sharply from $1.78, it will show that the bears continue to defend this level. The price could then drop to the moving averages and lower it to $1.36. A bounce from this level could keep the pair within the $1.36 to $1.78 range for a while.
MKR technical analysis
Maker (MKR) is correcting within an uptrend, but one positive is that the bulls are currently refusing to let the price fall back below the breakout level of $1,651.
The 20-day EMA ($1,615) is sloping up and the RSI is near the overbought zone, suggesting an advantage for the buyers. If the recovery from $1,651 holds, it will signal that the bulls have turned this level into support. The MKR/USDT pair could then attempt to rise to the $2,000 resistance level.
The 20-day EMA is an important support level to watch out for in a downtrend. A break and close below this level could drag the pair down to the 50-day SMA ($1,483).
Bulls bought the dip to the uptrend line on the 4-hour chart, signaling solid buying at lower levels. The bulls have pushed the price above the 20-day EMA and are trying to extend the recovery above the $1,825 resistance. If they do that, the pair could rally to $1,900 and then $2,000.
The bears will have to drop the price below the uptrend line to weaken the bulls. Selling could accelerate if $1,651 is broken. The pair could then drop to $1,500.
