As could be expected, Bitcoin is and will continue to be the best cryptocurrency on the market. Its scarcity, security, decentralization, transparency, and global acceptance as a store of value are the characteristics that allow it to be a fundamental pillar in the crypto world today. To learn more about Bitcoin, let’s analyze its chart in depth. Are you joining us?
Bitcoin Chart
This chart follows a fundamental bullish trend, and in the short term, we continue to see a continuation of this bullish trend,
Right now, Bitcoin’s price is at $61,400, which represents an increase of more than 260% since the lows at the end of 2022. An incredible rise for this year, right? What do you think is happening?
If we switch to the weekly chart, you’ll see that the price continues an upward trend since the beginning of the year, creating higher highs and higher lows.
However, in the last few months, it has been moving sideways between the key levels of $70,000 and $60,000.
The most likely scenario now is that it continues to move sideways in that zone and gains more strength to keep moving up.
Technical Analysis of Bitcoin
To perform a technical analysis of Bitcoin, it is essential to read the charts and their context well such as the trend of the chart, the patterns of entry and exit, the supports and resistances, etc. Therefore, let’s analyze all the technical indicators that today’s Bitcoin chart displays.
1- Supports and Resistances
The difference between support and resistances is minimal: both are the same. The only difference is that supports are below the price and resistances above. Where are the levels located on this Bitcoin chart?
As you can see, Bitcoin was in a strong bearish trend, and the $17,000 zone helped to slow it down a bit.
After breaking that support, it made a false breakout and moved back inside, starting the short-term bullish trend we have now.
This entire bullish trend has allowed buyers to push hard and break the psychological barrier of $70,000.
Now, after breaking December’s highs, the trend has continued upward, and due to various factors (including the news of BlackRock’s ETF launch or the recent halving), it has surged to resistance around $70,000 with strong demand, breaking through the zone and creating a rejection that keeps the price below resistance within a large accumulation zone. For now, the accumulation zone is in control, and we should either wait or take advantage of the situation to accumulate during this process.
2- Where to Enter and Exit
It is not easy to place your entry price, exit price, or even the stop loss correctly. If you intended to exit the operation manually, you can forget that idea. It will not benefit you at all. Knowing when to enter a trading operation is important, but it is much more important to know how to exit correctly.
So, let’s go. Let’s mark our key points:
You should consider what type of investor you are. If you want to buy for the long term (holder), you would wait for the support zones to accumulate positions. You wouldn’t mind the price oscillating. On the other hand, if you like trading (swing trader), you must be clear about where to place your entry, your stop loss, and your risk.
In both cases, you can take advantage of the opportunities that the 2 key points I’ve placed on the chart offer:
- If you’re a holder, you can use the zone around $52,000 or even where it is now, at $61,400, to accumulate BTC, which would be ideal right now if the price bounces there, or wait again for it to drop to $50,000 – $45,000. As you know, in crypto, anything can happen, so the price could even return to the $17,000 zone, although that’s much less likely.
- Another option is to try catching a swing trade between the support and resistance zones, or vice versa. This would involve waiting for support around $52,000 and aiming for the next resistance at $70,000 or targeting $80,000 and $90,000, which align with Fibonacci projections calculated from the last impulse (i.e., where the price is more likely to slow down).
3- Weekly Moving Average
Today, we can (and should) adjust our technical indicators to assist us. The weekly moving average, although poorly configured, will not lead us to major disasters. Anyway, we have configured it to mark significant differences in terms of precision and utility. The blue line indicates bullish moments, while the red, draws the bearish ones. Let’s see what happens in this case.
The weekly moving average has been bullish for over 11 months (blue), so we remain bullish in the short-term trend. Currently, there’s no price-value tension, and the price has already found some support to move higher. Do you see it clearly? What decision would you make?
4- Divergences
When a divergence occurs, something smells bad, something is wrong, because the price and something derived from the price do not match. If you want to know how to read an indicator when looking for divergences, click here. Now, let’s start detecting those contradictions between the price movement and a technical indicator on the Bitcoin chart.
MACD
There are few occasions when significant divergences of MACD appear on weekly charts. However, when they do appear, caution is necessary because significant changes are coming. Let’s analyze the Bitcoin chart. At first glance, what do you detect? Tell me. 😉
The price continues in the sideways zone we mentioned earlier, and the MACD is still falling, which means it’s not supporting these new highs. We could be facing a bearish divergence. Remember, this doesn’t mean the price will drop immediately, but it could be losing upward momentum.
We should see the MACD turning bullish again for the price to resume its upward movement with strength.
RSI
The RSI moves between 0 to 100 and indicates whether the price is expensive or cheap. Two things could happen:
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- The price is very high and there is an overbought situation (levels above 70).
- The price is below 30 (oversold or very low).
The RSI on this chart shows that the price is at an intermediate level while the price continues to rise. Currently, the price is in a sideways zone, but the RSI has been dropping for some time, showing weakness and a bearish divergence. Let’s remember that since the RSI is an oscillator, it tends to behave this way in strong trends, and it’s often the first to signal a potential divergence.
Triangles
The triangles in trading form an important part of technical analysis with cryptocurrencies. There are different types of triangles. We have the ascending triangle, the descending triangle, and the symmetrical one. Which one appears in the Bitcoin chart?
For now, we don’t have more compression in the form of triangles, and the price continues a strong rise without many stops.
5- Volatility
Volatility is usually a sign that the price is accelerating in one direction. To know the volatility that Bitcoin currently has, we will look at the Japanese candles. Remember, the interpretation of Japanese candles in trading is a matter of common sense.
The larger candles represent fast price movements. The smaller ones show the opposite: quieter areas.
In the daily chart, I’ve highlighted (red circles) the last periods where Bitcoin showed high volatility. As you can see, in the last few weeks, volatility has started to decrease to support the $61,000 zone.
The interesting point is the area we’re in now: there have been several days of upward volatility followed by downward moves the next day. This could indicate that large players are pushing but also selling part of their holdings. This could be a clear sign of accumulation before continuing the upward movement.
Forecast with Bitcoin
If you’ve made it this far, it’s because you already know what this is about. You are clear about what Bitcoin is, but you want to know what will happen with it. We will tell you what could happen from now on. However, we do not promise that it will happen. This is what we deduce from the different patterns, but it is not 100% reliable.
Short-term bullish trend, the key will be for the price to continue accumulating in this zone to build strength and break upwards. The price action and structure clearly show it has the momentum to continue.
We need to keep an eye on this accumulation zone and make sure the price doesn’t lose the $56,000 – $52,000 area to maintain the accumulation before moving higher. In fact, if you look closely, it has attempted to break downwards several times but ended with a rejection candle pushing it back up. This is a very good sign, indicating that there are buyers trying to hold the $52,000 area as strong support.
Personally, I think with all the FOMO happening right now and the increasing adoption by the public, it’s very likely we’ll see the continuation of the upward move, especially if the price can break out of the sideways zone.
What would you do? Would you buy now? Or would you wait for an interesting correction to enter?
If you liked this analysis, here’s the analysis and prediction of Ethereum.
Trading with Bitcoin
As you know, trading with Bitcoin is very delicate. Buying and selling, taking advantage of price changes is not a game. You need to be trained to do it effectively and profitably. Anything else will only lead to losing time and money. Don’t you want that? We must enjoy every day as if it were the last, don’t you think?
Don’t procrastinate. If you want to learn how to do it right, practice with us, and remember to store Bitcoin in the world’s safest wallet, Material Bitcoin. 😎 And, of course, don’t forget to keep observing the Bitcoin chart with us. The more you practice, the better you’ll do. However, do not buy just because the price reaches support, always wait for it to confirm the stop.
If you have doubts or questions, join our telegram channel!
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