Knocking at resistance doors (again) – Bitcoin Update
Yep, bitcoin will soon be knocking at resistance again. A month ago, when I wrote my last update, I was feeling pretty bullish. Rightly so, since bitcoin bulls managed another 10% push to $4190, a yearly high. However, following this swift surge in price was an even swiffter decline.
Following this dump, an equally violent choppy market pushed the market valuation of bitcoin further down. The price went below the Ichimoku cloud and only reversed at $3,640, a previous resistance in confluence with a 62% fib retracement of the run from the February low. I mentioned this price level in the previous update as a breaking point. I’m glad we didn’t break below.
From there the price embarked on a slow and choppy uptrend. Throughout March it’s been riding on the 200 4h MA. This support was tested numerous times, with strong demand immediately kicking in more often than.
Altcoin market knocking down resistances
Most of the big altcoins had a more or less similar trajectory as bitcoin. Big altcoins like ETH, EOS, XRP or ADA (which is currently just below the neckline of an inverted head and shoulders, a highly bullish pattern) are still wary of what bitcoin is going to do. It seems the dump from $4,190 scared big money from confidently entering the markets.
The only big alt that showed proper strength was litecoin. It’s price rose 40% in the last 4 weeks. In part, that was probably due to the upcoming halving – a process of block mining reward reduction – due in August.
Yet, LTC’s 40% is nothing compared to the market of some mid-cap and smaller-cap altcoins. Similarly to what happened in January, bitcoin’s slow grind upward from start of March was a fantastic time. Many coins made 100%+ gains in a few days or even a few hours. It was possible to predict such a market and pretty easy to catch a nice 10% – 20% on most of the altcoins.
Bitcoin – daily time frame
With bitcoin again knocking at resistance, the altcoin market is cooling down a bit. A big move is expected for bitcoin. This is traditionally a pretty tough time for altcoin BTC valuations, even in cases when BTC pushes upwards.
Bitcoin’s price is nearing the triangle resistance, which lies at around $4,190. If it manages not only to push through it but also close some 4h+ candles above $4,200, this will be a very important boost for the bulls. It will also mark a break of the inverted head & shoulders pattern. Per the rule, this could take us to around $4,900. Furthermore, such a push will also pull the whole total market cap over the key resistance area.
However, as the macro picture is that we are still in bear market, one needs to be very careful. The first resistance is at around $4,400. There we meet the high point from early December 2018, from which we plunged further down. This level is in confluence with the 100 % Fibonacci extension level of the current triangle.
The main resistance is at around $4,700. This resistance area has a strong confluence, as there we meet the 200 day MA and the Ichimoku upper cloud boundary. This is also the area where btc would make 50% retrace from the November-initiated dump. And if that is not enough, that’s the area where the deadly descending diagonal comes in play again. All of this will serve as a strong resistance. I doubt we’ll do more than just knock at that resistance.
Bitcoin knocking at resistance
I do not want to be too cautious because of the February dump.However, the current price of bitcoin is an especially critical phase. You don’t want to be caught with your pants down. With the market as choppy and unpredictable as it is, we could easily go for another test of the ascending RSI support. It is in confluence with the support which can be drawn from the February 14th. A rejection will be deadly for all the longs opened here, where the price is knocking at resistance.
Currently, the daily RSI level is inching into the overbought area and is currently at 63. However, we still got some room left before the situation will become critical.
One bullish sign in the way bitcoin has been behaving is the fact that during the most recent dump to $3,700 area, the price reversed before it touched the lower support. This indicates that the trend is accelerating and that demand is getting stronger and stronger.
All in all, I’d say we’ve got enough power to go for the resistance area around $4,100. After that, all options are on the table. I figure big volume will start kicking in. Only then will we know whether there is any chance that the low 3000s will remain the bottom for a bit longer.
Following this dump, an equally violent choppy market pushed the market valuation of bitcoin further down. The price went below the Ichimoku cloud and only reversed at $3,640, a previous resistance in confluence with a 62% fib retracement of the run from the February low. I mentioned this price level in the previous update as a breaking point. I’m glad we didn’t break below.
From there the price embarked on a slow and choppy uptrend. Throughout March it’s been riding on the 200 4h MA. This support was tested numerous times, with strong demand immediately kicking in more often than.
Altcoin market knocking down resistances
Most of the big altcoins had a more or less similar trajectory as bitcoin. Big altcoins like ETH, EOS, XRP or ADA (which is currently just below the neckline of an inverted head and shoulders, a highly bullish pattern) are still wary of what bitcoin is going to do. It seems the dump from $4,190 scared big money from confidently entering the markets.
The only big alt that showed proper strength was litecoin. It’s price rose 40% in the last 4 weeks. In part, that was probably due to the upcoming halving – a process of block mining reward reduction – due in August.
Yet, LTC’s 40% is nothing compared to the market of some mid-cap and smaller-cap altcoins. Similarly to what happened in January, bitcoin’s slow grind upward from start of March was a fantastic time. Many coins made 100%+ gains in a few days or even a few hours. It was possible to predict such a market and pretty easy to catch a nice 10% – 20% on most of the altcoins.
Bitcoin – daily time frame
With bitcoin again knocking at resistance, the altcoin market is cooling down a bit. A big move is expected for bitcoin. This is traditionally a pretty tough time for altcoin BTC valuations, even in cases when BTC pushes upwards.
Bitcoin’s price is nearing the triangle resistance, which lies at around $4,190. If it manages not only to push through it but also close some 4h+ candles above $4,200, this will be a very important boost for the bulls. It will also mark a break of the inverted head & shoulders pattern. Per the rule, this could take us to around $4,900. Furthermore, such a push will also pull the whole total market cap over the key resistance area.
However, as the macro picture is that we are still in bear market, one needs to be very careful. The first resistance is at around $4,400. There we meet the high point from early December 2018, from which we plunged further down. This level is in confluence with the 100 % Fibonacci extension level of the current triangle.
The main resistance is at around $4,700. This resistance area has a strong confluence, as there we meet the 200 day MA and the Ichimoku upper cloud boundary. This is also the area where btc would make 50% retrace from the November-initiated dump. And if that is not enough, that’s the area where the deadly descending diagonal comes in play again. All of this will serve as a strong resistance. I doubt we’ll do more than just knock at that resistance.
Bitcoin knocking at resistance
I do not want to be too cautious because of the February dump.However, the current price of bitcoin is an especially critical phase. You don’t want to be caught with your pants down. With the market as choppy and unpredictable as it is, we could easily go for another test of the ascending RSI support. It is in confluence with the support which can be drawn from the February 14th. A rejection will be deadly for all the longs opened here, where the price is knocking at resistance.
Currently, the daily RSI level is inching into the overbought area and is currently at 63. However, we still got some room left before the situation will become critical.
One bullish sign in the way bitcoin has been behaving is the fact that during the most recent dump to $3,700 area, the price reversed before it touched the lower support. This indicates that the trend is accelerating and that demand is getting stronger and stronger.
All in all, I’d say we’ve got enough power to go for the resistance area around $4,100. After that, all options are on the table. I figure big volume will start kicking in. Only then will we know whether there is any chance that the low 3000s will remain the bottom for a bit longer.
Disclaimer
The information and publications are not meant to be, and do not constitute, financial, investment, trading, or other types of advice or recommendations supplied or endorsed by TradingView. Read more in the Terms of Use.