Will BTC Hold 22,364? Short-Term Bounce Underway
After a bloodbath in selling this week with a decline of approximately 20% in the past few days, a short-term bounce may be underway in
BTCUSD
BTCUSD
.
There are three types of market participants (perhaps more) engaging in driving price higher in the short term.
BTC has been making a desperate attempt to hold its 200-week SMA (shown as the purple line above) after breaking below it on June 13, 2022. At least for now, BTC has climbed back above it. But this level will be critical to hold on the next retest. The fact that it was broken on the first attempt is not a positive sign.
In the short-term, a reversion to the mean—at least on short-term intraday time frames—may be underway. As long as this uptrend line holds on the 30m chart below, and as long as the 8 EMA and 21 EMA on the 30m chart remain viable as support, the bounce could continue back to the key Fibonacci level—which is now resistance after having served as major support before it was broken yesterday. This level, as noted in the linked article, is at 26,400 approximately. More immediate resistance lies closer at 24K-25K as shown by the blue rectangular area above price in the 30m chart below.
If a trader wishes to short in the direction of the larger-degree trend, it would be advisable to wait until BTC retraces back to a key resistance level and—preferably—shows signs of stalling and reversing there.
BTCUSD
BTCUSD
. There are three types of market participants (perhaps more) engaging in driving price higher in the short term.
- Shorts are probably covering. This includes dealers who are covering short put positions that crypto holders bought to hedge or trade.
- Long-term crypto investors and enthusiasts are seeing the move, likely hoping they have caught the bear-market bottom (and like typical bottom hunters, they may be thinking of the millions in profits that will be earned when BTC tops $100,000 some day—and I don't blame them, we all think of such things).
- Traders are looking for a reversion to the mean, hopefully using stops and discipline to make a few thousand.
BTC has been making a desperate attempt to hold its 200-week SMA (shown as the purple line above) after breaking below it on June 13, 2022. At least for now, BTC has climbed back above it. But this level will be critical to hold on the next retest. The fact that it was broken on the first attempt is not a positive sign.
In the short-term, a reversion to the mean—at least on short-term intraday time frames—may be underway. As long as this uptrend line holds on the 30m chart below, and as long as the 8 EMA and 21 EMA on the 30m chart remain viable as support, the bounce could continue back to the key Fibonacci level—which is now resistance after having served as major support before it was broken yesterday. This level, as noted in the linked article, is at 26,400 approximately. More immediate resistance lies closer at 24K-25K as shown by the blue rectangular area above price in the 30m chart below.
If a trader wishes to short in the direction of the larger-degree trend, it would be advisable to wait until BTC retraces back to a key resistance level and—preferably—shows signs of stalling and reversing there.
Comment:
If you haven't seen the updated analysis from @TradersWeekly, be sure to review it as well as it discusses some of the substantive issues behind the selling this week in addition to providing technical analysis.
Comment:
Here is the 30m chart mentioned above, where the 8 EMA and 21 EMA are—for the time being—serving as support. If that support fails, then all bets are off yet again.
Comment:
The below chart shows another potential area of resistance where price could reach in the short-term. The dark circle super-imposed over the blue trend line would also be a key area where a bounce could reach before being sold again.
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