Consolidation before $30,000? – In a week when activity in the financial markets is truncated by the Easter weekend, the price of Bitcoin (BTC) failed to return to contact with $30,000. Maybe a simple postponement. But the essential point that matters the bulls, remains the neutralization of the bear run of the king of cryptos. As we speak, it begins timidly.
The latest technical analyzes tell us that the rebound in BTC since March 10 could come to a halt as it approaches $30,000. And for good reason, the good news of the previous weeks is now well integrated into the courses. The scenario of a consolidation could take shape after a surge practically in a straight line.
In a market context where the tensions on the banking sector have momentarily subsided, let us now see how the king of cryptos could behave in the days/weeks to come.
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Bitcoin in weekly units – Price inside Kumo, but below $30,000
For the third week in a row, Bitcoin settles inside the Kumo (Ichimoku Cloud). But this signal of neutralization of its bear run since its last ATH in November 2021, is marked by three weekly candles moving flat. As a result, this is hampering the continuation of the rebound beyond $30,000. This resistance, both psychological and symbolic, could act as a barrier in the weeks to come.
On the weekly chart, the $20,000-22,000 alert zone is far enough away for bulls to worry about. At the same time, they might seek some grounds for satisfaction. On the one hand, the Chikou Span is closing in on the descending line and the Tenkan with a view to ending its status quo under the Kumo. And on the other hand, the price of BTC is currently sailing in a bullish channel since the beginning of the year.
Assuming consolidation can take place, the King of Cryptos would test $26,000. If a throwback were to occur, the probability of rallying $30,000 would occur under the conditions that the bulls would ideally dream of. And if the FED’s monetary policy showed signs of clarity, nothing would prevent us from considering the $35,000a level unfortunately historically marked during the huge corrective wave of spring 2022.
Otherwise, a bearish extension below $26,000 would not be a disaster. On the sine qua non condition that prices do not overflow the bottom of the bullish channel. Nevertheless, it would mean a return of doubt among the bulls due to the current uncertainties that remain.
Bitcoin in daily units – Prices in a narrow range
In daily units, the price of Bitcoin has been stuck in a narrow range since March 18.
Generally, this type of chart configuration is conducive to a large amplitude movement, and therefore probably to a resurgence of volatility. As we speak, Bitcoin is alternating moves above and below the Tenkan. The bulls are reluctant to break above $30,000 and the top of the rising channel. And if prices drag on for a long time under this resistance, we may fear a consolidation.
In this sense, the breakout of the Tenkan would send the king of cryptos towards $26,000, not far from the Kijun. The holding of this support would maintain the favorable positions of prices and the Chikou Span above the Kumo. And above all, it would potentially prepare the ground for a new upward wave towards $30,000. This would reinforce the neutralization of the bear run.
Conversely, if the $26,000 breaks, then the bulls will have to be on their guard. There is indeed a risk of landing abruptly towards the bottom of the bullish channel. An exit from the chart pattern from below would threaten $22,000. And in the event of a return of a peak of stress on the financial markets, an overflow below this support near the 2017 ATH (or $20,000) would mean that the bears would regain some control of the trend. With the risk that Bitcoin returns to its lows of last year.
In summary, the neutralization of Bitcoin’s bear run since its last ATH in November 2021 is slowly taking hold. Classes in weekly units take place inside the Kumo. But if the renewed volatility were to assert itself during the next sessions, the bulls would have no reason to be feverish as long as prices are still sailing in the bullish channel. And as we mentioned last week, it would be below $22,000 that the improvement since the beginning of the year could fade.
The other point to underline will be to avoid naively falling into the trap of overinterpreting the increase in the Fed’s balance sheet. Because precisely, it has been followed by a contraction since the week of March 21. To the point that a disappointment on the king of cryptos could hover below $30,000.
To this must be added the declarations of OPEC on April 2 on the reduction in oil production, which again drove up the price of black gold. In the event of a stronger than expected economic recovery in China, a return of inflationary pressures in the United States should not be ruled out. This would force the Fed to raise rates again, despite the specter of a recession. As a result, Bitcoin is at risk of catching a chill again, given its stubborn correlation with the Nasdaq.
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