According to CoinShares, institutional entry into cryptocurrency products reached $ 4.5 billion in the first quarter of this year, which is 11% higher than the entry seen in the fourth quarter of 2020. This shows that institutional interest is on the rise, but quarter-on-quarter growth has slowed from the 240% recorded in the fourth quarter of 2020.
As the price of Bitcoin rises, more funds are needed to maintain the levels. Therefore, if institutional inflows do not recover in the coming days, Bitcoin (BTC) and other altcoins could experience a significant correction.
The upcoming correction could test the resolve of institutional investors and while these investors have a lot of money, some may have jumped into cryptocurrencies just to make speculative gains quickly. There is always the possibility that investors could close their positions if Bitcoin begins to correct itself.
While this may accelerate the decline, lower levels are likely to attract investors who may have missed an opportunity to jump on the bandwagon earlier. If this assumption is the case, volatility across the market may remain high for the next few days.
Let’s analyze the charts of the top 10 cryptocurrencies to see if it also projects a possible correction.
BTC / USDT
The failure of Bitcoin to cross the stiff overhead resistance zone between $ 60,000 and $ 61,825.84 appears to have attracted profit-taking from short-term momentum traders. This dragged the price below the 20-day exponential moving average ($ 56,863) earlier today.
If the price sustains below the 20-day EMA, the bears may see an opportunity and are likely to try to push the price to critical support at the 50-day SMA ($ 54,333). If this support breaks and the bears manage to hold the price below the 50-day SMA, selling could intensify.
The next support on the downside is $ 50,460. If this level also breaks down, the BTC / USDT pair could drop to $ 43,006.77. The flat moving averages and the Relative Strength Index (RSI) dipping below 52 suggest that the bulls may be losing control.
Contrary to this assumption, if the price bounces off the 50-day SMA, the bulls will make one more attempt to push the pair to a new all-time high. If they are successful, the pair could start its journey towards the next target at $ 69,540 and then hit $ 79,566.
ETH / USDT
Ether (ETH) hit a new all-time high on April 2, but was unable to take off and keep climbing. This showed uncertainty among the bulls, and while they managed to push the price to a new all-time high of $ 2,150 on April 6, the rally has since stalled.
That may have frustrated momentum traders who appear to have closed their positions today, resulting in a drop to the 20-day EMA ($ 1,904). If the ETH / USDT pair bounces strongly from the 20-day EMA, it will indicate demand at the lower levels.
Then the bulls will make one more attempt to push the price above $ 2,150. If they have their way, the pair could begin its journey towards the next target at $ 2,618.14.
This positive view will be invalidated if the bears sink and hold the price below the 20-day EMA. Such a move will suggest a possible change in sentiment and that could drag the price to the trend line.
Binance Coin (BNB) is in a huge uptrend. The bears tried to sink the price below the breakout level at $ 348.69 today, but the long tail on the candle shows that the bulls bought this decline aggressively.
The rising moving averages and the RSI near the overbought zone suggest that the bulls are in full control. If buyers can turn the $ 348.69 level into support, then the BNB / USDT pair could start the next leg of the uptrend that could take it to $ 500 and later to $ 530.
On the other hand, if the price falls below $ 348.69, it will suggest that higher levels are attracting profit-taking from traders. The bullish momentum may weaken if the bears sink the price below the 20-day EMA ($ 314).
XRP / USDT
XRP’s breakout above $ 0.65 on April 5 completed a reverse head and shoulders pattern, targeting the $ 1.11 level. The altcoin hit this target on April 6 when it hit an intraday high of $ 1.11.
Traders following technical analysis appear to have taken some of their gains close to the target of the pattern, causing a sharp pullback today.
The bulls are attempting to stop the correction near the 50% Fib retracement level at $ 0.84, as seen from the long tail of the candle. If buyers can sustain the rebound, it will suggest build-up at the lower levels and keep the prospects for a breakout above $ 1.11 alive.
On the other hand, if the XRP / USDT pair breaks below $ 0.84, the correction could deepen to the 61.8% Fib retracement level at $ 0.77. Such a deep correction can delay the start of the next leg of the uptrend.
ADA / USDT
Cardano (ADA) tried to move higher on April 6, but the long wick on the daily candle suggests a lack of demand at the higher levels. The bears have latched onto the opportunity today and are trying to drag the price down to $ 1.03.
The bulls are likely to aggressively defend the support at $ 1.03. If the price bounces off this level strongly, the bulls will try to push the price above the moving averages. If they can do that, the ADA / USDT pair could stay in range for a few more days.
The 10-day EMA ($ 1.18) flat and the RSI near the midpoint suggest a balance between supply and demand.
This neutral view will be invalidated if the support at $ 1.03 breaks. In such a case, the pair could start its journey towards the support at $ 0.80 and then drop to $ 0.70.
DOT / USDT
The failure of the bulls to push the price above the all-time high at $ 146.80 on April 5-6 could have attracted profit-taking from short-term traders. That may have pushed Polkadot (DOT) back below the breakout level at $ 42.28 today.
The bulls are currently trying to defend the 20-day EMA ($ 38). If they can achieve a strong bounce from this support, it will suggest build-up at the lower levels. Buyers can make one more attempt to break the all-time high. If they are successful, the DOT / USDT pair could rally to $ 53.50.
Conversely, a weak bounce will suggest little interest and a lack of urgency among traders to buy aggressively. That will open up the possibilities for the bears to sink the price below the moving averages. If that happens, the pair could drop to $ 26.50.
UNI / USDT
Uniswap (UNI) tried to rise above the $ 32.50 resistance but failed. This shows a lack of buyers at the higher levels. The bears are now attempting to sink the pair below the $ 27.97 to $ 25.50 support zone.
If they are successful, the UNI / USDT pair could start its journey towards the next support at $ 22 and then $ 18.
However, the flat 20-day EMA ($ 29.59) and the RSI near the midpoint suggest a balance between supply and demand. If the bulls can defend the support zone, the pair is likely to extend its action within the range for a few more days.
Litecoin (LTC) broke above the resistance line of the symmetrical triangle on April 5 and followed it with another upward move on April 6 that brought the price to stiff resistance at $ 246.96.
The failure of the bulls to clear the hurdle at $ 246.96 may have attracted profit taking from short-term traders and selling from more aggressive bears. That sank the price to the triangle breakout level today.
If the LTC / USDT pair bounces aggressively off this level, it will suggest that the bulls are building on the dips. Buyers will make one more attempt to break the hurdle at $ 246.96. If they manage to do that, the pair could begin its journey towards $ 307.42.
Conversely, If the bears sink the price below the moving averages, the pair could fall to the support line of the triangle.
LINK / USDT
Chainlink (LINK) broke above the $ 32 resistance on April 5 and followed it with another upward move on April 6, but the bulls were unable to reach the all-time high of $ 36.93. This suggests that the bears have not given up and are doing their thing at the higher levels.
The LINK / USDT pair fell back below the $ 32 level today. The bulls are attempting to defend the 20-day EMA ($ 29.85). If they manage to do that and cause the price to climb back above $ 32 in the next few days, it will suggest a build up at the lower levels.
So the bulls can retry to push the price above $ 36.93. Conversely, if the bears sink the price below the moving averages, it will suggest that the recent breakout above $ 32 was a bullish trap. The pair could then drop to $ 24.
After fluctuating in a tight range for the past few days, THETA rallied today and attempted to break above the overhead resistance of $ 14 to $ 14.96. However, the bears thwarted this attempt as seen from the long wick in today’s candle.
If they are successful, the THETA / USDT pair could begin the next stage of the uptrend which has its target set at $ 17.65 and the next at $ 22.50. The 20-day EMA ($ 11.13) has started to appear once again and the RSI has risen above 68, suggesting that the momentum favors the bulls.
However, bears are unlikely to give up easily. They will try to stop the rally in the upper resistance zone. If they manage to do so, the pair could extend its stay within the range for a few more days.
The views and opinions expressed here are solely those of the author and do not necessarily reflect the views of Cointelegraph. Each investment and commercial movement involves risks, you must do your own research when making a decision.
Market data is provided by the exchange HitBTC.