Bitcoin created a frenzy early this morning on 2nd April as it broke past two resistance lines of $4,400 and $4,700 in single candle-stick with a high of $5106. The price action took place at around 5: 00 Hours UTC.
While no fundamentals were backing the surge in price, various suggestions were brought including an April Fools joke about Bitcoin ETF getting approved. Moreover, according to the timeline of the action, it was probably initiated in Korean, Japanese or Chinese markets. Therefore, it is being suggested that the source of influx was perhaps singular.
Leading Analyst and derivative trader, Tone Vays, says that daily BTC/USD chart has entered a “no trade zone.” He also stated that to confirm the bullish move it is imperative that Bitcoin moves above the 200-Day Moving Average currently hovering around $4700.
A bullish break above the $5200 range would move the price towards the next most significant resistance around $6000-$6300. The moving averages suggest that further consolidation is required before the bulls can take full control.
Tone Vays mentioned that since the price is still along the 200-Day Moving average, the bullish momentum is not confirmed “pointing to a pullback $4200.” However, continued bullish momentum would have targets at $5600 and $6000.
On the weekly chart, Vays suggested that a break above $5000 is imperative at the end of the week to move above the 100-Day moving average line (in pink above). He said,
“It could take several days before the move is confirmed,
“Right now Bitcoin is in an absolute no trade zone… Wait and See if the weekly chart is gonna close above $5000 or below this moving average. If Bitcoin closes above this moving average on a weekly scale then I would be absolutely certain that its a bull trap.”
However, he also suggested that the 1-hour chart is indicating strong bullish action. Hence, it marks a crucial week which will set the mood of the market for the rest of the year.
Nivesh from Engineering Background is a full-time Crypto Journalist at Coingape. He is an atheist who believes in love and cultural diversity. He believes that Cryptocurrency is a necessity to deter corruption. He holds small amounts of cryptocurrencies. Faith and fear are two sides of the same coin. Follow him on Twitter at @nivishoes or mail him at nivesh(at)coingape.com