Background:
By now you saw the ~10% rally this morning. Bitcoin (or I should say a whale/MM) felt compelled to drive Bitcoin to the upside; but also with Q3 over, and much of the bad news/fud lifting in the market, we are seeing bullish sentiment rising on the back of comments by the US government regarding possible ETF approval, their promise to not ban crypto, Twitter ramping up crypto/NFT integration and the Evergrande issues handled (for now).
Its worth nothing that a large part of this rally is thanks to the strong support level established above $40k, which held strong despite the bad news and fud, increased selling pressure from whales.
Summary:
With today's rally, Bitcoin recovered a range just above the 200 DMA ($45.3k) and under local resistance ($47.2k). This was a strong break in the local structure and on the 2W chart confirmed support on the 10 year bull market support and the 2.5 month support line from July.
Whats Next?:
The fact that Bitcoin bounced suggests the next local pattern to play out may be a weak rising wedge with a key resistance level around $50.8k; and a close over $53k would confirm the rising bullish sentiment and flip August resistance to support which is EXTREMELY significant because it would be a breakthrough of the macro resistance from April 2021 (ATH). But approaching the confluence of macro resistance means bulls have a lot of work still, if it rejects here we have a possible downside to $42-44k. If those levels fail to hold, its possible a drop as low as $32k, with a $34k confluence of support in that range that could paint a symmetrical triangle on the macro, which would suggest further downside later to $29k and possibly lower.
On the chart resistance levels are plotted to the price bar (red lines). Below are resistance levels bulls need to overtake if they want to reach $60k again:
By now you saw the ~10% rally this morning. Bitcoin (or I should say a whale/MM) felt compelled to drive Bitcoin to the upside; but also with Q3 over, and much of the bad news/fud lifting in the market, we are seeing bullish sentiment rising on the back of comments by the US government regarding possible ETF approval, their promise to not ban crypto, Twitter ramping up crypto/NFT integration and the Evergrande issues handled (for now).
Its worth nothing that a large part of this rally is thanks to the strong support level established above $40k, which held strong despite the bad news and fud, increased selling pressure from whales.
Summary:
With today's rally, Bitcoin recovered a range just above the 200 DMA ($45.3k) and under local resistance ($47.2k). This was a strong break in the local structure and on the 2W chart confirmed support on the 10 year bull market support and the 2.5 month support line from July.
Whats Next?:
The fact that Bitcoin bounced suggests the next local pattern to play out may be a weak rising wedge with a key resistance level around $50.8k; and a close over $53k would confirm the rising bullish sentiment and flip August resistance to support which is EXTREMELY significant because it would be a breakthrough of the macro resistance from April 2021 (ATH). But approaching the confluence of macro resistance means bulls have a lot of work still, if it rejects here we have a possible downside to $42-44k. If those levels fail to hold, its possible a drop as low as $32k, with a $34k confluence of support in that range that could paint a symmetrical triangle on the macro, which would suggest further downside later to $29k and possibly lower.
On the chart resistance levels are plotted to the price bar (red lines). Below are resistance levels bulls need to overtake if they want to reach $60k again:
- $47.3k
- $48.3k
- $49k-50k
- $51k
- $53k (macro resistance from April 2021/ATH)
- $58.4k