Hello everyone! Bitcoin managed to close last week with a very strong candle, which was probably due to several reasons. Countries looking into Bitcoin, Microstrategy buying, Elon Musk saying they won't sell and a lot of other little positive news coming from various groups which are pushing for regulatory clarity and are pro Bitcoin. We had the formation of the mining council in the US which I don't think is a great idea, but many investors perceive it as a good step forward. Some regulatory clarity is also coming from China and it looks like miners moving out of China will be a very positive thing for Bitcoin.
Today Bitcoin had a decent day as acted as expected. After Microstrategy announced that they completed the buying of Bitcoin, Bitcoin slowed down and had a little dip. A few hours later they announce that they plan to sell 1B worth of stock in order to buy another 1B worth of Bitcoin. I don't know if the SEC allows them to do so, but if they do... More big buying is coming and people will front run it again. We also had Paul Tudor Jones say that he now has 5% into Bitcoin and suggests that this is the right allocation.
Now Bitcoin is forming a mini uptrend and the momentum has shifted upwards even if it might be short term only. Although Bitcoin going down to 18-24k would be very reasonable and based on my view of TA & cycles that would be the most likely scenario... Current fundamentals and quantitative data disagree. First of all there is a clear shift that money is moving back into BTC from alts. Yes alts will bounce, yes some will do very well... but despite what Bitcoin does, many need quite a lot of time before they start going up again. The amount of stablecoins in the market is very high indicating a lot of money on the sidelines and the marketcap to stablecoins ratio is very low (bullish) and at the same time the NVT and S2F are indicating Bitcoin was and is pretty cheap here. Actually the cheapest it has been in years based on those indicators. Long/Short rations have been the lowest they have been since Nov-Dec 2020 (all across the board), funding still very low and lending rates have completely collapsed. All that means that people are sitting on the sidelines and most gains could be made by going long right now. So overall momentum is shifting, positive news coming out again and again, on-chain data and futures are showing a pretty strong market with the potential of going higher and weak hands have been shaken out.
So let's get into what we see based on TA which shows a bit of different picture and indicates that the path forward for Bitcoin might not be as smooth. Below I have added several links with interesting charts. Bitcoin has closed above 38.4k which was a key level and has confirmed an uptrend in lower timeframes. A small issue is that 36-37.4 is an area where Bitcoin left a decent gap on CME and some untested areas, but if Bitcoin goes there I think it is a good opportunity to go long even just in the short term. From 40k all the way up to 49k there is a ton of resistance for Bitcoin and several others things that I've mentioned on my previous analysis (Death cross, many touches of 28-31k + 300 DMA etc). Currently Bitcoin has found resistance at about 41k after sweeping the 40.4k high and then turned 39.5k into support which is quite bullish. Based on the horizontal resistance, the monthly P and the 200 DMA 42-42.5k seems to be the most important resistance. but as you can see below 44-44.5k also has resistance (50DMA + Weekly R3 + horizontal on CME) and 46-49k has some tons of resistance both on CME (major gap down), GBTC and especially the spot chart as it was a key break down level which was support for quite some time + R3 yearly. In my opinion if we go above 50k we will probably keep going higher. 53-54k is key resistance and could give a strong dip, but after that we'd probably see more upside. Yes this could turn like September 2020 with Bitcoin going up to 49-53k, then down to 37-40k and then higher. To me this won't be easy, this won't be smooth.
Finally in terms of alts, they might bounce soon as they are getting oversold and are near support... but Bitcoin dominance could get all the way up to 60% before alts go up again.
Good luck!
s3.tradingview.com/s...shots/v/vKulLydi.png
s3.tradingview.com/s...shots/h/hRhPMolN.png
s3.tradingview.com/s...shots/w/WNxRL0qI.png
s3.tradingview.com/s...shots/8/8ll0mAGH.png
s3.tradingview.com/s...shots/j/J7AAuLM4.png
s3.tradingview.com/s...shots/i/IBCJc6Xq.png
coinalyze.net/snapshot/eGLbxKom
Today Bitcoin had a decent day as acted as expected. After Microstrategy announced that they completed the buying of Bitcoin, Bitcoin slowed down and had a little dip. A few hours later they announce that they plan to sell 1B worth of stock in order to buy another 1B worth of Bitcoin. I don't know if the SEC allows them to do so, but if they do... More big buying is coming and people will front run it again. We also had Paul Tudor Jones say that he now has 5% into Bitcoin and suggests that this is the right allocation.
Now Bitcoin is forming a mini uptrend and the momentum has shifted upwards even if it might be short term only. Although Bitcoin going down to 18-24k would be very reasonable and based on my view of TA & cycles that would be the most likely scenario... Current fundamentals and quantitative data disagree. First of all there is a clear shift that money is moving back into BTC from alts. Yes alts will bounce, yes some will do very well... but despite what Bitcoin does, many need quite a lot of time before they start going up again. The amount of stablecoins in the market is very high indicating a lot of money on the sidelines and the marketcap to stablecoins ratio is very low (bullish) and at the same time the NVT and S2F are indicating Bitcoin was and is pretty cheap here. Actually the cheapest it has been in years based on those indicators. Long/Short rations have been the lowest they have been since Nov-Dec 2020 (all across the board), funding still very low and lending rates have completely collapsed. All that means that people are sitting on the sidelines and most gains could be made by going long right now. So overall momentum is shifting, positive news coming out again and again, on-chain data and futures are showing a pretty strong market with the potential of going higher and weak hands have been shaken out.
So let's get into what we see based on TA which shows a bit of different picture and indicates that the path forward for Bitcoin might not be as smooth. Below I have added several links with interesting charts. Bitcoin has closed above 38.4k which was a key level and has confirmed an uptrend in lower timeframes. A small issue is that 36-37.4 is an area where Bitcoin left a decent gap on CME and some untested areas, but if Bitcoin goes there I think it is a good opportunity to go long even just in the short term. From 40k all the way up to 49k there is a ton of resistance for Bitcoin and several others things that I've mentioned on my previous analysis (Death cross, many touches of 28-31k + 300 DMA etc). Currently Bitcoin has found resistance at about 41k after sweeping the 40.4k high and then turned 39.5k into support which is quite bullish. Based on the horizontal resistance, the monthly P and the 200 DMA 42-42.5k seems to be the most important resistance. but as you can see below 44-44.5k also has resistance (50DMA + Weekly R3 + horizontal on CME) and 46-49k has some tons of resistance both on CME (major gap down), GBTC and especially the spot chart as it was a key break down level which was support for quite some time + R3 yearly. In my opinion if we go above 50k we will probably keep going higher. 53-54k is key resistance and could give a strong dip, but after that we'd probably see more upside. Yes this could turn like September 2020 with Bitcoin going up to 49-53k, then down to 37-40k and then higher. To me this won't be easy, this won't be smooth.
Finally in terms of alts, they might bounce soon as they are getting oversold and are near support... but Bitcoin dominance could get all the way up to 60% before alts go up again.
Good luck!
s3.tradingview.com/s...shots/v/vKulLydi.png
s3.tradingview.com/s...shots/h/hRhPMolN.png
s3.tradingview.com/s...shots/w/WNxRL0qI.png
s3.tradingview.com/s...shots/8/8ll0mAGH.png
s3.tradingview.com/s...shots/j/J7AAuLM4.png
s3.tradingview.com/s...shots/i/IBCJc6Xq.png
coinalyze.net/snapshot/eGLbxKom
