Bitcoin Price Analysis: The Short-Term Support Line Is Intact, Are We Getting Ready For Another Upward Move?

bitcoin price analysis
bitcoin price analysis chart source by Tradingview

Bitcoin Price Analysis: The Short-Term Support Line Is Intact, Are We Getting Ready For Another Upward Move?

The price of Bitcoin reached $4200 yesterday, before breaking down and forming a massive bearish engulfing candle. The breakdown was preceded by short-term bearish divergence in the RSI. Price is following a short-term ascending support line that has been in place for 17 days and is currently trading inside a minor support area.

Important Notes

  • There is major resistance near $4400.
  • There are minor support areas near $3800 and $ 3700.
  • Price is above the 21, 50, 100-day moving averages and below the 200-day MA.
  • Price has broken above the daily Ichimoku cloud and found support above it.
  • Price is following a short-term ascending support line.

Bitcoin Price Analysis – BTC/USD – Daily Chart

bitcoin price analysis
Chart Souce: Tradingview, Bitfinex

A look at the Daily chart for Bitcoin shows that after reaching $4200, price broke down amidst a bearish engulfing candle and found support at the 50-period moving average, where it is currently trading now near $3900. The 21 and 50 period moving averages have made a bullish cross and are offering support to price.

Furthermore, after multiple unsuccessful attempts, the price has broken out above the Ichimoku cloud every moving average except the 200-period MA. The RSI was into overbought territory for a short period of time before falling down to 52. The MACD has lost almost all of its power and is currently in the process of making a bearish cross. It is of importance to keep an eye on whether it makes or rejects a bearish cross. Finally, we can see that price is following an ascending support line and has been doing so for the past 73 days. The support line is currently near $3500. The first major resistance area is found near $4400, coinciding with the 0.382 fib line of the entire drop from $6000.

BTC/USD – 4-Hours Chart

bitcoin price analysis
Chart Source Tradingview, Bitfinex

A look at the 4-hour chart shows that the breakdown in price was preceded by very significant bearish divergence deep into overbought territory in the RSI. The drop was very sharp and occurred with substantial volume. Furthermore, the MACD has turned negative and is falling sharply.

On a positive note, we can see that there is a trading structure in place because since bottoming at $3400 on February 10th, the price has been following an ascending support line. Price is currently trading inside the minor support area near $3800 which corresponds with the 0.5 fib line of the entire upward move. If the support line and area fail to hold the price, the next significant support area will be found at $3660-$3700.

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Bitcoin Price Analysis: The Short-Term Support Line Is Intact, Are We Getting Ready For Another Upward Move?
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Bitcoin Price Analysis: The Short-Term Support Line Is Intact, Are We Getting Ready For Another Upward Move?
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The price of Bitcoin reached $4200 yesterday, before breaking down and forming a massive bearish engulfing candle. The breakdown was preceded by short-term bearish divergence in the RSI. Price is following a short-term ascending support line that has been in place for 17 days and is currently trading inside a minor support area.
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Author: Valdrin Tahiri

Valdrin is an eager trader, cryptocurrency enthusiast, and freelance writer. He specializes in technical analysis, indicators and charting guides. Reach out to him at [email protected]

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Valdrin Tahiri 35 Articles

Valdrin is an eager trader, cryptocurrency enthusiast, and freelance writer. He specializes in technical analysis, indicators and charting guides. Reach out to him at [email protected]