Last week in Bitcoin Price Analysis we said:
BTC looks bullish on the 4H, neutral / consolidating on the daily (with bullish divergence), and bullish on the weekly – pending a strong weekly close above the 200SMA. Despite the strong TA indicators, black swan events and weakening fundamentals could send markets reeling back to support zones. It will be an important week for the globe, markets, and BTC. Trade with extra caution during this time of indecision.
Last week BTC retraced to the 200 week SMA, which held nicely as support – sending markets on a bullish bounce. Currently, BTC is back above the $24k mark and is regaining bullish momentum.
Let’s take a look at the charts this week and see if we can predict BTC’s next move.
Bitcoin Price Analysis
BTC’s moving averages on the short-term 4H chart remain in a bullish configuration. Last week’s price retrace took BTC to the 100 SMA, which acted as support. This level will continue to act as support and is currently priced at $22.9k. The 200SMA will also act as support at $22.1k.
Momentum indicators are signaling overbought on the 4H chart. This means we could see a pullback and/or a period of consolidation at the $24k mark before higher resistance levels can be broken. The local resistance is at $24.6k, which was the prior top just over a week ago.
Moving averages are in a bearish configuration on the daily chart, but there is clear bullish divergence as the price has broken the 50SMA and is moving up to test the 100 SMA. The 100 SMA will act as resistance, currently priced at $25.6k, while the 50 will act as support at $21.6k. You can see in the chart above that the 50 SMA is starting to incline upward.
Daily momentum is neutral, and shows upward pressure. It is likely that this move will take us at least to the 100 SMA at $25.6k before becoming overbought. It could take several days to get to this level given what we are seeing on the 4H chart.
On the weekly, BTC has successfully held the 200 SMA as support – a major achievement that will likely send the market up. The 200 SMA will act as strong support moving forward, priced just beneath $23k. RSI and Stochastic are still moving up, and are not yet overbought. The next major resistance on the weekly is at the $28-30k zone.
Bitcoin Investor Sentiment
Investors remain fearful despite upward market momentum, likely due to the lingering black swan potential thanks to geopolitical tensions and fears of a lengthy global recession.
Bitcoin Fundamental Analysis
Glassnode reported in their new weekly on-chain analysis that futures volume shows that BTC markets are stabilizing following the Luna collapse. While futures and options pricing does not show a strong bullish bias yet, it does show that investors are willing to take on moderate amounts of price exposure. Markets are now showing negligible bias in either bullish or bearish directions.
The 4H chart looks primed for a pullback or consolidation, while the daily and weekly look bullish. Investor sentiment remains fearful, which is slightly bullish, and fundamentals are neutral. This sets the stage for a neutral / bullish tilt in the short term, while retaining bullish biases in the long term. BTC holding above the 200 weekly SMA is very bullish, and suggests that the worst is over.
- $23k (weekly 200 SMA)
Not investment advice. Do your own research.