The price for Bitcoin (BTC), the top-ranked cryptocurrency, is currently around $ 9,000 after the impressive 20% rally last week in a single day. Since the halving is now less than two weeks away, it seems a breeze to put Bitcoin on for a long time to catch the next explosive move.
However, there is a diagram view that indicates that we may have gone up, and I’ll start with that today.
Daily performance of the crypto market. Source: Coin360.com
Reduce in case of doubt
BTC USD daily chart. Source: TradingView
In last week’s analysis, I shared two possible ascending channels, one of which became invalid and one remained in the game. This week, I want to examine the possibility that we weren’t in either channel and that we could still be on a downward trend since the pump in June 2019, which reached nearly $ 14,000.
The upper trend line is confirmed by three touches. However, the lower trend line of this channel brings the immediate downtrend to $ 3,000 with the moving average at $ 6,300. These are not numbers that I expect Bitcoin to see again, but it would be stupid not to be prepared for them.
The Fib indicates what an outbreak could bring
BTC USD daily chart. Source: TradingView
The Fibonacci retracement values from the ATH of USD 20,000 per Bitcoin show us that a breakout today could lead us to return to much higher values than previously expected.
$ 9,550 is the critical level to focus on. It is both the 0.382 fib and the top of the channel. If you maintain this level, Bitcoin could rise towards the 0.5 Fib of $ 11.50.0, realistically putting the 0.618 Fib of $ 13,500 on the table.
Well, that’s all well and good, but “numbers are increasing” is not always an indicator that can be relied upon to confirm the direction in which we are moving based on current dynamics the monthly indicator of moving average convergence divergence or MACD.
MACD monthly analysis
BTC USD monthly MACD chart Source: TradingView
Last week I highlighted the importance the moving average divergence convergence (MACD) indicator has for Bitcoin price when it bullishly exceeds the weekly timeframe.
With the bullish monthly candle close, however, there is a new picture for the monthly MACD. Above are the monthly bullish and bearish MACD crosses, with the weekly bullish MACD crosses highlighted with the dotted lines – green for bullish crosses that have had a long run and red dotted lines for the wrong bullish crosses.
The reason for this map is to see if there are any patterns that match the weekly upward trend of 2017, which saw an increase of 2,000%. However, it is also useful to see whether the view with the higher timeframe shows contradictory impulses that could indicate that a dump is due soon.
Moving from left to right in the graph shows that the monthly MACD was already in a bullish crossover in March 2017 when the weekly MACD bullishly exceeded.
At the time of the weekly uptrend, both the MACD and signal lines were on an uptrend. This resulted in a 2,000% price increase for Bitcoin from the time of the weekly cross.
Later, the wrong bullish crossover in the weekly newspaper in September 2018 shows us that both the monthly MACD and the signal line were in a downward trend and that the monthly MACD was already bearishly crossing. Thus, the higher time frame pulse signaled that the shift from the weekly MACD crossover may not be valid.
The weekly bullish crossover in February appears to have exactly the same conditions as the crossover in September, with one difference. The monthly MACD’s histogram lost momentum, as evidenced by the paler pink color compared to the darker pink in the previous crossover. In this case, the price of Bitcoin rose by 400%.
If we now look at the dynamics of 2020, we can see that the monthly MACD aborted and changed direction between December and February, causing the signal line and the MACD to have a lateral trajectory – literally a premiere for Bitcoin.
But if you’ve read so far and are still tracking where I’m going with it, the monthly signal line is on an upward path for the first time since October 2015, when Bitcoin was only $ 200 a coin, and if you bring this to the all-time high of $ 20,000 is a tremendous 10,000% or 100x move.
In this sense, will the next bullish cross take place on the monthly MACD in June? Are we facing an increase of 10,000% compared to the current price? Only time can tell.
Bitcoin is starting to collapse
BTC USD 1 hour chart. Source: TradingView
If we now focus on the hour, we can see that after its big leg last night, Bitcoin formed a pattern of lower highs and higher lows.
This usually signals a possible continuation of the previous trend, and the upside potential is around $ 9,600. And if we had thought this level to be a candle near the daily newspaper, the next week would have looked incredibly bullish.
As this has just collapsed, it is expected to drop to $ 8,400 during the week.
The views and opinions expressed here are exclusively those of @official and do not necessarily reflect Cointelegraph’s views. Every step of investment and trading involves risks. You should do your own research when making a decision.