We’re going to take a look at the recent chart for Bitcoin and where we might be heading next. For more background on the current state of the fundamentals currently affecting Bitcoin , check out my
Now let’s dive in and look at the TA for Bitcoin .
Price has been range bound between 6200 – 6600 for the past 2 weeks, but we seem to be gradually breaking above that range now, but beware! Price is heading in to multiple areas of resistance which must be broken through if we’re going to make it much higher.
Between 6800-6900 levels we have
- Blue dotted horizontal resistance that has acted as resistance on 3 previous occasions
- Fibonacci 38% retracement level (orange)
- Short-term upper resistance (red)
- 100-day Moving Average (blue)
None of these levels offer particularly strong resistance on their own, but combined, they could be enough to stop a weak bitcoin market in its tracks. There are a record number of short orders placed on Bitmex so bear are primed and ready to send price lower.
Price is travelling in an upwards (red). Should bulls manage to break through these levels, it will probably up and down between upper and lower boundaries until sellers come in and take price down to a new low.
If price does manage to get to 7500 (by some miracle), we’re likely to hit resistance from the joint Fib 61.8% level intersecting with the downwards (thick red dotted line) which has acted as heavy resistance with price hitting it and bouncing lower 5 times since 20 Jan. For sure, there’s going to be a lot of sellers here waiting to push BTC lower.
What action can I take?
Right now is not a good point to enter the market. Plenty of upcoming resistance and no clear support.
If you're holding Bitcoin or bought recently at around 6,000, I’d recommend looking for signs of weakness at around 7300-7400 and potentially closing your positions and take profits. I’ll post exactly when nearer the time so make sure that you follow me or this post to receive updates.
From there, price will likely head lower and retest 6000 level which has held up well recently. However, unless fundamentals change significantly by that time, then it seems unlikely to hold, and price would most probably fall to the 5000-4600 level. I feel pretty confident that we’ll get a nice bounce at these levels, so we’ll be looking to buy in at around 5000.
On this weekly chart, you can see how price has been reversing lower over a series of lower highs at fib levels. Also notice the long term upwards which is likely to offer very strong support somewhere between 5000-4000.
I’ll keep you posted closer to the event so follow me and stay tuned!
Keep a level head. This analysis is still in play. Price is now touch the top of the rising wedge and price is getting close to hitting the fib 50% retracement level AND the 100 moving average, which is definitely an area to be watching.
Could price break through these levels? Yes, it could if there's enough FOMO, and I'm sure that there will be. 7500 is still our ultimate target and we need to be very cautious around 7500.
Exit positions before 7500.
We do seem to be in a rising wedge pattern which is a bearish pattern. I still see 7500 (or just below) as a good place to sell. We are certain to see experience some turbulence at this level and I expect price to drop sharply from there.
Expect price to retest the high before dropping again. If price does get back to 7400, it might be a good area to exit positions and buy back in at a discount.
Here's what happened on the 4hr Chart...
Thanks for sharing