Dear Midas Community,
This is our weekly update on Bitcoin price movements. We as a team feel that these insights are valuable to the community, as the value fluctuations of Bitcoin greatly affect altcoin markets. In this series of TA articles, we will conduct both price and fundamental analysis to determine an overall trend for BTC.
Price Analysis
Once again we will observe the movements on a large (4H) candle timeframe. We can see that over the past few weeks, Bitcoin has been consolidating between the 9-10k mark, with breaks out of this range quickly correcting.
A new wedge is forming on the chart, with support being repeatedly tested in the $8800 zone. This is a major support zone, which has survived multiple tests. The lower highs suggest that this zone will continue consolidating until a direction is determined.
On the shorter-term 30m candle chart, things are looking decently bullish with a nice bounce from the $8800 support zone. The moving averages are looking good as well, with the 100MA crossing the 200MA. This bullish move would be confirmed with high volume, which has not yet happened.
Investor Sentiment
Investor sentiment is a key indicator for the market direction. As the renowned investor Warren Buffet once said, “Be fearful when others are greedy, be greedy when others are fearful.” The key here is to go against the sentiment. When times are fearful, it presents a good buying opportunity. Likewise, when investors are greedy, the market is likely due for a correction.
The sentiment index has been in the low 40s for quite some time now, showing investors are tepid about price prospects. Nonetheless, the market has not had any significant moves in either direction, so the index has stalled out in this range.
Fundamentals
Miners revenue continues to hold near yearly lows. Bitcoin miners have certainly taken a large decrease in earnings following Bitcoin’s block halving. These yearly lows have not broken significantly below $7M, creating a nice support zone after testing several times. The only way that miners are going to increase their revenue is by refusing to sell at this valuation.
Analysis
The $10k psychological resistance continues to evade Bitcoin, and the price is now consolidating yet again. After a failed attempt to break support last week, Bitcoin is in indecisive territory. On a short timeframe, technical indicators look neutral to bullish, but on the larger time frames, they look neutral to bearish. The best move now would be to wait for entries near the support zone, use tight stop losses, and exercise extra caution until Bitcoin determines a decisive direction.
Always do your own research before making an investment decision.
