Since our previous review, Bitcoin price has achieved another important level sharply plummeting after that. Let’s get to the bottom of this!
As you can see from the charts, the price managed to break through the resistance at the $4,080 level and to overcome the next level of $4,200 with a sharp momentum. The price grew since Saturday, but it has been falling sharply since Sunday. The market capitalization shrank by $14bn to $129bn. The breakthrough was short-lived, and just a couple of hours later the decline reversed the weekly increase. That’s why we often write about prudence and attentiveness in the market.
What does technical analysis tell us?
1- hour frame
The price decrease has canceled the buy signal. The EMA50 crossed the EMA100 from top to bottom, thus forming a sell signal. However, we do not recommend to rely entirely on this signal on the 1- hour timeframe. At the moment of writing, the moving averages act as local resistance at the levels of $4,010 (EMA50) and $4,030 (EMA100), and will hold back growth. The MACD indicator is in the sell zone. The price at $3,880 at the lower boundary of the ascending channel is attractive for buying with the targets at $4,080 and $4,200. But danger still remains, so we recommend to enter the market only with stops.
4- hour timeframe
The buy signal formed by the moving averages is still relevant; the EMA50 is still higher than the EMA100, although the EMA50 has already turned its head down. So it is not possible to speak about its strength, the more so since the MACD indicator is in the sell zone.
The EMA100 will act as a local support at the $3,762 level. The EMA50, in its turn, will hold back growth at the $3,960 level. As in the 1-hour chart, purchase from the slope looks attractive, but it is essential to keep in mind the probability to descend to the level of $3,600.
If the price stays above the $3,800 level in the next few days, we will then see a gradual climb to $4,200 in the current ascending channel. However, the risk of breaking through the slope and descending to $3,600 and $3,400 levels is really high, especially as long as the price continues to trade at the channel’s border.
The EMA50moving average is still turning upwards and will act as support at the $3,820. The EMA100 at $4,495 puts up resistance.
The MACD is still in the buy zone, but shows a reversal downwards, thereby reducing interest to buy.
In general, the picture in the market has not changed. The price trades near the levels we defined a long time ago. It is essential now for Bitcoin not to go down to the year-low and try to rise above $4,400 and $4,600.
The risk of decline is very high, but the upward momentum from the current levels is also possible. If you trade at our levels, please remember to identify your goals and stop-losses.
We wish everyone a great week and good profits!