For weeks, the price of Bitcoin has only known one direction. There have been no longer breathers for the bulls. And where have the bears gone? Is it still possible to invest in Bitcoin now or will the price soon slide further down again? This will be shown from a technical perspective using a weekly, daily, and 4-hour view.
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Opportunity to invest now?
For long-term investors, the focus is certainly on the larger time units. Higher level time units always have relevance in the lower time levels. Therefore, let’s now take a look at the weekly chart of the Bitcoin price.
The bears have done it! The current weekly candle is closed bearish. This means that the closing price is lower than the opening price. No bearish candle has been marked since the old all time high of 2017 was crossed. The bulls marched completely up and brutally trampled every bear. But will this continue?
The Relative Strength Index, an indicator that shows buying power (pictured below), has been in extremely expensive territory for weeks. Looking at the past in the Bitcoin price, this is currently the longest range in this expensive area. For the bulls, it is now extremely important to take a rest and recharge their batteries. This will happen either through a longer sideways phase or a downward price correction.
These support levels must hold for the price of Bitcoin!
What strikes right away are the four bearish candles right after the all-time high at around $42,000. Only the small support zone of $32,275 to $34,000 was able to provide support for the Bitcoin price. This week, the price failed to surpass the previous high. However, no further lows were set currently either.
A break of the support zone just mentioned should only find further buying power in the area of the lower two daily key levels. This zone extends from about $22,800 to about $23,850 on Coinbase. The superimposed Moving Average 200 (black ascending line), an indicator that reflects the long-term trend, would also have arrived at this support zone in the event of a renewed sell-off of the Bitcoin price. This indicator is seen as a strong support by many traders.
In order to continue to rise, the current high must be overcome sustainably. However, as it appears, the bulls are currently taking a break. Whether this is used and the Bitcoin price continues to rise or whether the bears take the helm remains to be seen.
Bitcoin price in no man’s land of decisions!
Looking at the 4-hour chart, one thing stands out: Something is happening, but nothing is really happening. Bulls and bears are joining hands, but neither faction really feels like starting anything. The current sideways movement must probably be sat out. It is still too early for good entries.
As soon as a stable trend develops again, one can look for entries. Here, it does not matter to traders whether the Bitcoin price rises or falls. With patience and the right setup, good short- and long-term profits can be achieved.
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First published in CRYPTO MONDAY, a third-party contributor translated and adapted the article from the original. In case of discrepancy, the original will prevail.
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