Bitcoin | Update after the Halving – What will be the next move?We have seen a lot of volatility in the past two weeks. This was of course to be expected. In our last analysis we talked about a potential reversal/shakeout pattern, but this one didn’t complete. For now, we can see that there is a lot going on with Bitcoin that we want to discuss in this analysis.
First of all, the Bitcoin CME Futures gap. Last week, CME Futures closed at a price point of 10085, opening Monday at 8820. This created a large gap with a price difference of 1265. At the time of writing this analysis, the price of Bitcoin spiked up, and filled the gap.
The gap in the CME futures has been filled, but as far as we can see now, Bitcoin is being rejected again at the 10K level. Bitcoin is creating a Lower High (LH), since it could’t break the last high of 10074. If Bitcoin cannot break the 10K level, we can see this as a clear rejection and Bitcoin can fall back on the latest support (9150 and 8850).
For now, we can see that Bitcoin is still in its rising channel. Normally these channels are bearish rather than bullish. In addition, we see that as the price of Bitcoin goes up, the volume decreases. This could also indicate that this “breakout” could be a fakeout to liquidate some long positions.
If we look at the second Bitcoin reward cut (July 9, 2016), we see that Bitcoin did fall again (29,92%) after the date (post-halving dump). If we will something familiar with the current price of Bitcoin, it would bring the price down to about the lower 6000 levels. In our opinion this would not be the case. We don’t expect Bitcoin to ever see the lower 6000 again.
A few last things to note is that Bitcoin’s price is still above 20 daily and monthly moving averages. Both are good indicators of whether Bitcoin is in an upward or downward trend. In the last Bull Run (2015-2017), the price of Bitcoin never fell below the 20 Monthly Moving Average.
We do not expect Bitcoin to break upwards out of the rising channel. Instead, we expect Bitcoin to move sideways in the coming days/weeks, after which we will break down out the channel. After an outbreak to the downside, many buy orders will be filled and the price of Bitcoin will slowly rise again. The next phase of Fomo begins..
A short overview:
We are above the 20 Daily Moving Average (currently at 8825)
We are above the 20 Weekly Moving Average (currently at 8081)
We are above the 200 Daily Moving Average (currently at 8042)
CME Futures gap filled
Volume is going down
Support levels at: 9150 and 8850
Resistance zone at 10K
Thanks for reading and let me know your expected price targets for the upcoming halving!
