Important Support and Resistance Levels to Watch on Bitcoin
Hello everyone! Thanks for taking the time to read my analysis. What a crazy time it has been for bitcoin over the past few days. Just as soon as I gave up on my double top reversal formation this morning, the prices plummeted to bring us well below the 9.3k neckline support once again. Last night I noticed a huge hidden bearish divergence on the RSI which pushed even higher this morning. This is a significant divergence that signals for bear trend continuation, and I don't see this changing until we get some solid confirmation of a reversal.
On to the analysis…
Because the price of bitcoin has been bouncing off the trendlines so perfectly, I felt it was necessary to make note of this.
There are 2 main resistance lines that are both very important for potential price reversal:
1.) The minor resistance line is the purple line formed from 17k down to 11.7k and while this line was clearly pierced between March 1st-March 7th it has remained a viable resistance line as we recently witnessed the price touch 9.8k before falling to where we are now. This is the trendline we will focus on first if BTC makes a rally up overnight.
2.) The Major resistance line is the red line formed from the ATH of 19.6k down to 17k. This trendline forms a strong resistance as BTC touched it recently (at 11.7k) before falling down hard.
If we can cut through the purple resistance line, this red line is our next target.
As for support, I also have 2 main trend lines:
1.) The minor support line is the black line formed from 3.4k (Sept. 15th) to 7k (Feb. 6th). You probably noticed that this black line appears to cut right through the candles on Feb 5/6 but on the daily chart this is actually right at the bottom of the candle body (with Heikin Ashi candles).
It doesn’t seem to be too much of a coincidence that we saw the price of BTC touch this line 3 times recently on the 8th, 9th, and 10th of March AFTER the line was drawn.
So this is the area I will be keeping a close eye on for bitcoin to potentially stop and reverse back up, which I have both circled in yellow.
2.) Finally, we have the major support line which is the bright green line from 2.8k (lowest point on Sept. 15th) to 6k (lowest point on Feb. 6th). We have yet to see Bitcoin touch this support line since the low in February and this could serve as a great reversal point. This point at 7.3k also happens to fall right on the .236 fibonacci retracement level. I expect bitcoin to bounce off this price by the end of the week.
After this, it is possible we continue further down and form a double bottom with the Feb 6th low, but for now I will watch these local levels before the next assessment.
On to the analysis…
Because the price of bitcoin has been bouncing off the trendlines so perfectly, I felt it was necessary to make note of this.
There are 2 main resistance lines that are both very important for potential price reversal:
1.) The minor resistance line is the purple line formed from 17k down to 11.7k and while this line was clearly pierced between March 1st-March 7th it has remained a viable resistance line as we recently witnessed the price touch 9.8k before falling to where we are now. This is the trendline we will focus on first if BTC makes a rally up overnight.
2.) The Major resistance line is the red line formed from the ATH of 19.6k down to 17k. This trendline forms a strong resistance as BTC touched it recently (at 11.7k) before falling down hard.
If we can cut through the purple resistance line, this red line is our next target.
As for support, I also have 2 main trend lines:
1.) The minor support line is the black line formed from 3.4k (Sept. 15th) to 7k (Feb. 6th). You probably noticed that this black line appears to cut right through the candles on Feb 5/6 but on the daily chart this is actually right at the bottom of the candle body (with Heikin Ashi candles).
It doesn’t seem to be too much of a coincidence that we saw the price of BTC touch this line 3 times recently on the 8th, 9th, and 10th of March AFTER the line was drawn.
So this is the area I will be keeping a close eye on for bitcoin to potentially stop and reverse back up, which I have both circled in yellow.
2.) Finally, we have the major support line which is the bright green line from 2.8k (lowest point on Sept. 15th) to 6k (lowest point on Feb. 6th). We have yet to see Bitcoin touch this support line since the low in February and this could serve as a great reversal point. This point at 7.3k also happens to fall right on the .236 fibonacci retracement level. I expect bitcoin to bounce off this price by the end of the week.
After this, it is possible we continue further down and form a double bottom with the Feb 6th low, but for now I will watch these local levels before the next assessment.
Comment:
Hi everyone, wanted to give this another update. It looks like Bitcoin bounced perfectly off the .236 fib level and green support trend line. I circled this area yellow for a reason! I like the volume we saw on this bounce, things look pretty good for bitcoin but we have many more obstacles ahead of us.
Our first obstacle coming up is the black support line which has been formed on the bottom of the candle bodies using the daily time frame. This support line also happens to be intersected by the .50 fib level. I expect Bitcoin to hit this area around 8.8k and then dip back down to the .382 fib area.
We are approaching the very end of this wedge where the support and resistance converge. So keep a very close eye on the price over the next 5 days because this could go either way from here.
Our first obstacle coming up is the black support line which has been formed on the bottom of the candle bodies using the daily time frame. This support line also happens to be intersected by the .50 fib level. I expect Bitcoin to hit this area around 8.8k and then dip back down to the .382 fib area.
We are approaching the very end of this wedge where the support and resistance converge. So keep a very close eye on the price over the next 5 days because this could go either way from here.
Comment:
BTC briefly pierced the black resistance line which will now act as support. The price right now is just hugging this line, so again we need to monitor this closely because a break back down below the line can easily happen. This is why I like to wait until 2 or 3 of these 4-hour candles closes well above the line for confirmation.
If it is able to close above the black trend line, we still have the purple resistance line right above it which has been very difficult for Bitcoin to pierce since December.
The RSI is also quickly approaching overbought condition, so we should expect to see a dip soon.
Stay tuned folks
If it is able to close above the black trend line, we still have the purple resistance line right above it which has been very difficult for Bitcoin to pierce since December.
The RSI is also quickly approaching overbought condition, so we should expect to see a dip soon.
Stay tuned folks
Comment:
Update: Bitcoin has failed to break through the purple resistance line, I mentioned in my update last night that this has been a difficult line for bitcoin to pierce since December. The selling volume looks quite high right now, which is concerning. However, let's keep an eye on the RSI on 1HR time frame and look out for a hidden bullish divergence to see if this is just another dip on the new uptrend. Otherwise, if this breaks we could see further downside.
Comment:
Sure enough, that purple resistance line was a tough one to break for Bitcoin. We didn't even get a chance to try for the higher red resistance line above. This fall has taken us under the rising black support line as well, which leaves us with one support: the rising green trend line formed from Sept. 15 onward.
Anyway, I will keep this idea open for now but I would like to share an update with everyone here. I found a bearish cypher pattern playing out and charted it with price targets. You can find the update here:
Anyway, I will keep this idea open for now but I would like to share an update with everyone here. I found a bearish cypher pattern playing out and charted it with price targets. You can find the update here:
Comment:
Bitcoin has approached the purple resistance line once again...let's see if it can break through this time. The end of this wedge is getting closer and closer, and pretty soon bitcoin will need to break out of this wedge which is defined by the green and red trend lines. A break out in either direction could determine bitcoin's path for months to come
Comment:
Bitcoin still having trouble with the purple resistance line, it's showing some serious strength. Here is a very short-term prediction of where we should expect to see a bounce based on the crab harmonic pattern:
Comment:
Price is dropping fast from that purple resistance line. Let's see if this green support line can hold us up once again. There is a bullish BAT harmonic pattern showing up here and the green support line crosses right through the PRZ. I believe we should see a bounce in this area:
Comment:
Friends, please take a look at this chart and load the new candlesticks. We are right on top of the green support line! The best current scenario is obviously a bounce off this support line so we can at least try to break the purple resistance line (which has not been easy for bitcoin to surpass lately). Keep an eye on my last update as well which shows the bat harmonic pattern, if this pattern holds true we should expect a bounce around the support line or in the PRZ. But even if this happens we are getting so close to the end of this big wedge and running out of room to keep bouncing back and forth between these trend lines. This is a crucial moment for Bitcoin right now as this support line has held bitcoin up since September 2017 and if we break below it and hold below it for a few days, then the chances of 4k or 3k prices for bitcoin become much more likely. But soon enough we will know Bitcoin's fate for many weeks to come so let's trade smart and be prepared for either situation!
Comment:
Major support line in green has been breached today. This is not good for bitcoin. We should see much lower prices in the upcoming weeks, I'll get a new update out soon for you guys.
Bitcoin has broken the local support trend line (in black) and is now in the process of dropping below the .382 fibonacci retracement. If bitcoin holds under the .382 fib, the next target is at the .236 fib level or the major support trend line (in green), whichever comes first. I still believe we will reach these levels right at the point of convergence as you can see in the chart above and possibly see a bounce back up. However, it is unlikely the bounce will bring us to the major resistance line (in red), but more likely we bounce off the purple resistance line. For now, let's just keep an eye on our targets and trade only on strong reversal signals.