Sunday Bitcoin price action seems to tell of an impending bullish turnaround, after a steep market selloff this week.
Today’s Bitcoin price analysis comes on the back of a surprise market downturn that saw crypto prices – across the board – barreling downward. The crash that began on Wednesday, may be coming to a halt and things may be turning around. We analyse Bitcoin price action to get a picture of what may happen next.
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Bitcoin’s price drop may have been steeper than expected, but appears to still be in line with the principles of technical analysis. Bitcoin has not died yet.
The short seller’s wet dream that was this past week’s price action – taking into account the grander scheme of things – looks, merely, to have been a 78% Fibonacci retrace from a $69,000 high. If prices decline below the $29,500 level, then one might have occasion to panic. For now, (at the time of writing, at least) Bitcoin is priced at $41,578 with today’s price action looking indicative of an incoming market turnaround.
Today’s trading session (taken from Huobi price data, streamed through TradingView) seems to be forming a Doji candle, which follows a bullish harami pattern that was formed in the previous two trading sessions. This usually foretells impending bullish price action.
Opening at $41,611, today’s trading action took bitcoin to a modest high of $42,306. The daily low – as it currently stands, was also within a narrow price band, and sits at $40,514. $BTC is down about 22% in the past 10 days, from a price of $52,096. The most immediate resistance levels to take on, are $41,900, $43,500, and $47,300. One might be more confident of a strong upward move if trading action buoys prices above the $49k – $54k level.
Things – however – look as though price action may be gearing up to break out of a downward wedge. The Ichimoku indicator seems to indicate a halt in selling pressure, as all moving averages have begun to run flat, with the Chikou turning upwards following a steep dip.
The stochastic oscillator is currently in the oversold condition, with the fast line beginning to cross over the slow line. The moving averages on the MACD indicator, on the other hand, show a bullish divergence, though price action dipped quite steeply, the MACD offers a contrasting picture, showing the increase in market momentum. TA isn’t a game of absolutes, and things may still get ugly but a turning point may have been reached today.
