$BTC 1D and 4H technical analysis.
Updated
BTC:1D
Bearish price to RSI divergence continues to play out with price hanging in the bottom half of the above regression trend. Maintaining the current trend trajectory would require an upward mean reversion to the 46.5K level. OBV remains constructive but seems to be weakening in strength.
Sustained price action below the -3SD (39.5K) level would begin to place downward ‘shatter pressure’ on the above linear regression trend and weaken the trend strength. Current trend strength as measured by Pearson’s R^2 is extremely strong at 0.94 and is due for some weakening as maintaining this elevated level of strength for extended periods of time often proves to be a tenuous proposition.
At current, price hits oversold (<=70) on the 1D RSI at roughly 36.3K and I would expect a move down to the 1.382 (34.4K) level before the end of April.
BTC:4H
Price currently sitting in the upper end of the descending linear range (43.4K) and coming out of being deep in overbought on the 4H RSI. On balance volume has trended up recently but failed to breach the zero line to the upside and remains in bear trend territory.
This is a key inflection point or a ‘breakdown or breakout’ level. For price to breakout I would need to see sustained consolidation above the third standard deviation level (43.4K) with a follow through up to the 46.5K level to indicate the recent trend from early October 2023 is still intact. (See 1D chart) Even an upward mean reversion to the 46.5K level would still be a lower high.
It seems as though a head and shoulders pattern is emerging and could portend one more downward flush below the 38K level and leading into the
BTC halving in late March/April. This would make sense given the potential for said halving to introduce short term ‘supply shock’ into the marketplace as more coins are released into circulation.
Generally the periods a couple months post halving tend to begin trending bullish as the market absorbs new supply, however an initial dip in price upon the introduction of more supply often has an adverse impact on price as short term scarcity is diminished with a supply increase through the release of more coins.
In summation, to confirm the bullish trend since fall of 2023 is intact we would need to see an upward mean reversion to the 46.5K level, at a minimum, while a downward breach of the 38K level would confirm the ‘supply shock’ theory leading into the halving. Needless to say price is at a ‘breakout or breakdown’ inflection point and my current thesis is that price finds its bottom in the 36K-34K region before the end of April 2024.
Bearish price to RSI divergence continues to play out with price hanging in the bottom half of the above regression trend. Maintaining the current trend trajectory would require an upward mean reversion to the 46.5K level. OBV remains constructive but seems to be weakening in strength.
Sustained price action below the -3SD (39.5K) level would begin to place downward ‘shatter pressure’ on the above linear regression trend and weaken the trend strength. Current trend strength as measured by Pearson’s R^2 is extremely strong at 0.94 and is due for some weakening as maintaining this elevated level of strength for extended periods of time often proves to be a tenuous proposition.
At current, price hits oversold (<=70) on the 1D RSI at roughly 36.3K and I would expect a move down to the 1.382 (34.4K) level before the end of April.
BTC:4H
Price currently sitting in the upper end of the descending linear range (43.4K) and coming out of being deep in overbought on the 4H RSI. On balance volume has trended up recently but failed to breach the zero line to the upside and remains in bear trend territory.
This is a key inflection point or a ‘breakdown or breakout’ level. For price to breakout I would need to see sustained consolidation above the third standard deviation level (43.4K) with a follow through up to the 46.5K level to indicate the recent trend from early October 2023 is still intact. (See 1D chart) Even an upward mean reversion to the 46.5K level would still be a lower high.
It seems as though a head and shoulders pattern is emerging and could portend one more downward flush below the 38K level and leading into the
BTC halving in late March/April. This would make sense given the potential for said halving to introduce short term ‘supply shock’ into the marketplace as more coins are released into circulation. Generally the periods a couple months post halving tend to begin trending bullish as the market absorbs new supply, however an initial dip in price upon the introduction of more supply often has an adverse impact on price as short term scarcity is diminished with a supply increase through the release of more coins.
In summation, to confirm the bullish trend since fall of 2023 is intact we would need to see an upward mean reversion to the 46.5K level, at a minimum, while a downward breach of the 38K level would confirm the ‘supply shock’ theory leading into the halving. Needless to say price is at a ‘breakout or breakdown’ inflection point and my current thesis is that price finds its bottom in the 36K-34K region before the end of April 2024.
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