Downward-sloping channel formed, weekly time frame turns bearish
It has been about a week since Bitcoin’s fourth halving. Yet, despite investors’ bullish expectations of what would have come, Bitcoin has not really gone anywhere. Instead, it continues to trade choppily within the recently formed downward-sloping channel, and its technicals on the daily graph, including RSI, MACD, and Stochastic, show bearish signs; this also applies to some technicals on the weekly time frame. Furthermore, Bitcoin is testing an extended trendline that connects the peak from December 2023 to the one in January 2024; a failure of this support to hold the declining price will bolster a bearish case in the short term. Critical levels to watch out for in such a case lay at $59,313 and $53,015.
In regard to Bitcoin addresses, the number of ones with balances exceeding 1,000 BTC has been trending sideways throughout April 2024, neither showing fear among large speculators nor any interest in accumulating more coins. However, the number of addresses with holdings exceeding 100 BTC has declined slightly since the halving. In addition to that, Bitcoin ETF inflows slowed down notably this month.
Considering there is an FOMC meeting on Tuesday and Wednesday, along with some important economic releases in the United States later during the week, volatility could pop back up, negatively affecting the cryptocurrency market. Therefore, it seems appropriate to stay highly vigilant in the current environment. In a case of significant selloff in the stock market, let’s say 10% to 15%, we would expect Bitcoin to pull back toward $53,000.
Illustration 1.01
The image above shows the trendline connecting peaks from December 2023 to January 2024.
Illustration 1.02
Illustration 1.02 portrays the weekly chart of BTCUSD’s RSI. The yellow arrow indicates a bearish breakout below 70 points, a highly bearish development for Bitcoin.
Illustration 1.03
Illustration 1.03 depicts the weekly chart of BTCUSD’s MACD. The yellow arrow highlights a bearish crossover, which is a worrisome sign.
Technical analysis gauge
Daily time frame = Bearish
Weekly time frame = Slightly bearish
*The gauge does not necessarily indicate where the market will head. Instead, it reflects the constellation of multiple indicators.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not serve as a basis for taking any trade action by an individual investor or any other entity. Your own due diligence is highly advised before entering a trade.
In regard to Bitcoin addresses, the number of ones with balances exceeding 1,000 BTC has been trending sideways throughout April 2024, neither showing fear among large speculators nor any interest in accumulating more coins. However, the number of addresses with holdings exceeding 100 BTC has declined slightly since the halving. In addition to that, Bitcoin ETF inflows slowed down notably this month.
Considering there is an FOMC meeting on Tuesday and Wednesday, along with some important economic releases in the United States later during the week, volatility could pop back up, negatively affecting the cryptocurrency market. Therefore, it seems appropriate to stay highly vigilant in the current environment. In a case of significant selloff in the stock market, let’s say 10% to 15%, we would expect Bitcoin to pull back toward $53,000.
Illustration 1.01
Illustration 1.02
Illustration 1.03
Technical analysis gauge
Daily time frame = Bearish
Weekly time frame = Slightly bearish
*The gauge does not necessarily indicate where the market will head. Instead, it reflects the constellation of multiple indicators.
Please feel free to express your ideas and thoughts in the comment section.
DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not serve as a basis for taking any trade action by an individual investor or any other entity. Your own due diligence is highly advised before entering a trade.
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