Altcoins are ready to explode if Bitcoin breaks down the sideways zone.

Bitcoin (BTC) has not yet surpassed the $120,000 mark, but the positive signal is that the bulls are still holding their ground, not allowing the bears to gain an advantage. According to data from Farside Investors, investors have continued to pour money into BTC ETF funds, which have seen a net inflow of capital over the past three trading days.

American billionaire and hedge fund manager Ray Dalio shared on the Master Investor podcast that allocating 15% of a portfolio to Bitcoin or gold could provide an "optimal risk-return ratio," while this strategy also acts as a hedge against the devaluation of fiat currency.

Daily crypto market data | Source: Coin360The nearing peak price of BTC has shifted investors' attention to Ether and some other altcoins. According to a recent report from Standard Chartered, fund management companies focusing on Ether have purchased about 1% of the total ETH supply since early June, and this figure could increase tenfold from the current level.

Some other companies have also announced plans to add certain altcoins to their asset portfolios, indicating a growing demand from institutional investors in the crypto market.

Let's analyze the charts of the top 5 cryptocurrencies that are trending strongly in the near future with Bitcoin Magazine.

Bitcoin Technical Analysis

Buyers have repeatedly failed to push BTC above the resistance level of $120,000, indicating a lack of demand at higher price levels.

BTC/USDT Chart – 1 Day | Source: TradingViewThe 20-Day Simple Moving Average (SMA) is trending upwards ($118,170) and the Relative Strength Index (RSI) is in the positive zone, reinforcing the bullish breakout outlook. If it breaks through the resistance level of $123,218, the BTC/USDT pair could surge to $135,729 and then reach the pattern target at $150,000.

Conversely, if the price drops below $115,000, this indicates that short-term traders are taking profits. This pressure could pull the price below the neckline of the inverted head and shoulders pattern and then down to $110,530 – a support area that the bulls need to protect fiercely. Losing this level, the risk of a deeper drop to $100,000 will increase significantly.

BTC/USDT Chart – 4 hours | Source: TradingViewBoth moving averages are flat on the 4-hour chart, and the RSI indicator is just below the neutral level, signaling a balance between supply and demand. A breakout and close above $120,000 indicates that the bulls are trying to take control, which could push BTC to test the resistance level at $123,218.

On the negative side, a drop and close below $114.723 would give an advantage to the bears. This could bring the trading pair down to a solid support level at $110.530.

Technical Analysis of Ether

ETH has reversed from $3,941, but the bulls are trying to keep the price above $3,745. This indicates that the buyers are attempting to turn this level into support.

ETH/USDT Chart – 1 Day | Source: TradingViewThe 20-Day SMA ($3.473) is sloping up and the RSI indicator is in the overbought zone indicating an advantage for the buyers. If the price increases and surpasses $3.941, the ETH/USDT pair may challenge the $4.094 level. The sellers are expected to strongly defend this level as if they succeed in surpassing and closing above, ETH could target $4.868.

A positive outlook will be dismissed in the short term if the price drops and falls below the 20-day SMA. If that happens, ETH could enter a deeper correction towards $3,250.

ETH/USDT Chart – 4 hours | Source: TradingViewThe price has bounced from the support level of $3,745, but the bulls could not overcome the resistance at $3,941. This pulled ETH back to $3,745. Sliding down and closing below this level could hinder the bulls, pulling the price down to the $3,500 area – a zone that buyers will vigorously defend. Below this level, ETH could begin a deeper correction towards $3,250.

The bulls will need to push the price above $3,941 to gain control. If successful, the trading pair could then surge to $4,094, where the bears are expected to join in.

Technical Analysis of BNB

BNB has dropped from $861 on Monday, indicating profit-taking by short-term investors.

BNB/USDT Chart – 1 Day | Source: TradingViewBNB/USDT may pull back to the breakout area of $794, which is an important support level to watch. If the price recovers from $794, it indicates that the bulls have turned this level into support, thereby increasing the prospects of breaking through $861, opening up the target of $900 and even $1,000.

On the contrary, breaking and closing below $794 signals that the bulls are rushing to close positions, pulling the price down to $761, a crucial level that needs to be defended.

BNB/USDT Chart – 4 hours | Source: TradingViewThis trading pair has fallen below the SMA 20 line on the 4-hour chart, indicating that selling pressure is high. BNB may drop to the SMA 50 line, an important level to watch. Losing this level could cause the trading pair to drop to $761.

On the other hand, a strong bounce from the 50 SMA indicates demand at lower levels. The bulls will try to push the price above the 20 SMA. If successful, BNB may retest the resistance level of $861. A breakout and close above $861 could trigger the next phase of the upward trend towards $900.

Technical Analysis of Avalanche

Avalanche has accumulated in the range of $15.27 to $27.38 over the past few weeks, indicating a buying trend when prices fall and selling when prices rise.

AVAX/USDT Chart – 1 Day | Source: TradingViewThe 20-day SMA ($23,52) is trending upward and the RSI indicator is in the positive zone indicating that the buyers are in control. If the bulls succeed in pushing the price above the resistance level of $27.38, the AVAX/USDT pair could begin a new growth phase targeting $36 and then aiming for $39.49.

On the contrary, if the price decreases and falls below the 20-day SMA line, this indicates that the bulls have given up. In this case, the price may retreat to the 50-day SMA line ($20,48), continuing to extend the oscillation period within the range.

AVAX/USDT Chart – 4 hours | Source: TradingViewThis trading pair has sharply declined from $27.38 and fallen below the SMA 50 line on the 4-hour chart, indicating that the bulls are quickly exiting their positions. This move could cause AVAX to drop to $23, which is expected to act as a strong support level.

The price bouncing back from $23 and rising above the SMA 20 line will reflect strong buying power at lower levels. The bulls will then try to push the price above $27.38. A breakout and close above the upper resistance level could signal the start of the next bullish phase.

Technical Analysis of Pudgy Penguins

Pudgy Penguins (PENGU) has risen sharply in the past few days, but the bulls are facing strong resistance at $0.046.

PENGU/USDT Chart – 1 Day | Source: TradingViewThe upward sloping moving average and the RSI indicator in the positive zone indicate that the bulls are in control. If buyers push the price above $0.046, the PENGU/USDT pair could begin its next bullish leg with an initial target of $0.054 and then $0.065.

The 20-day SMA line ($0.033) is an important support level to watch in the downtrend. Sliding down and closing below the 20-day SMA line indicates that the bulls are taking profits. This could cause the trading pair to drop to $0.028.

PENGU/USDT Chart – 4 hours | Source: TradingViewThe price has dropped from the upper resistance level at $0.046 and is back below the 50 SMA line on the 4-hour chart. The next support level in the downtrend will be $0.035. A recovery from $0.035 indicates that demand may emerge at lower levels. If this scenario occurs, PENGU could be trapped in a range from $0.035 to $0.046 in the near future.

The bears will gain an advantage if the price breaks through and closes below the support level of $0.035, paving the way for a correction to $0.028.

Vincent