Crypto Bear Market Fading - How to Re-enter
After Bitcoin's most recent visit to the institutional demand level around 30k, BTC experienced a strong 12% daily rally, followed by some weakness on the third touch of the upper daily downtrend channel line. Today however, BTC is starting to show signs of strength again as it has just broke through the upper daily downtrend channel line. Technically the downtrend is still intact until BTC breaks through 39.5k, and I suspect BTC will do that very soon. So let's assume BTC does break the daily downtrend level of 39.5k, how might one re-enter? Although crypto does have the tendency to ignore technical indicators and go parabolic, I think the market may have learned its lesson this time around, and I think buying into BTC on breakout of 39.5k could be a trap. Assuming BTC continues on its current trajectory, both the 4 hour RSI and 4 hour 50 EMA Bollinger Bands will indicate an overbought market and one could reasonably expect a healthy pullback. Given the scenario stated unfolds, my target price to re-enter BTC will be about 34.5k-36k. This area should provide strong buying support since it will have cleared the upper daily downtrend channel line, broken the daily downtrend, and started a new daily uptrend. Bitcoin is the crypto giant and tends to lead the entire market, so I will be using BTC to re-enter my other crypto positions as well.
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