Hello, dear traders and happy New Year to all of you! At the very beginning of 2020, we find Bitcoin in a critical position. The next few days are going to decide the price movement for the next month. Therefore, today, we are taking a look at the Bitcoin price chart analysis for BitMEX BTC/USD perpetual for a few different intervals.
Bitcoin Price Chart – The End of the Falling Wedge?
Firstly, let’s see what’s been going on since the last time we analyzed BTC. The current price is $7,500, and it has been holding above $7,000 since December 20th. Although this perfectly aligns with the falling wedge we described more than a few times, this long-term formation may just come to an end.
The price of Bitcoin is reaching the new lower high. However, this time we are approaching some crucial levels that may prove to be significant for the rest of this fiscal quarter.
As it is visible on the 12-hour chart above, there are four critical levels we have to acknowledge in the technical analysis. The $6,400 support and $7,600 resistance. These two have been playing ping-pong with the price of BTC since late November. The important thing to take note of is that Bitcoin tested the support only two times while it bounced off the resistance level more than a few times.
The two blue horizontal lines mark the first two levels that Bitcoin will test in a bullish or bearish scenario. If bulls win the current battle, the next major resistance is at $9,000. If the opposite happens and bears have their way, the next support level awaits Bitcoin at roughly $5,600.
At the time of the press, Bitcoin is testing the $7,600 resistance again. However, unlike before, this test coincides with the new lower high of the falling wedge formation. Therefore, there are two possible outcomes. Either Bitcoin bulls finally break the resistance and the wedge or the resistance holds and takes BTC spiraling downwards again. In order to answer that question, we will have to take a look at a shorter interval Bitcoin price chart.
The 4-hour BTC/USD chart
The chart above reveals Bitcoin another, short-term support at $7,000. This one is quite significant even though BTC broke through it once since December 19th. The important thing that the chart shows is that Bitcoin is coming towards the lower high without being overbought, according to the RSI.
The MACD histogram is about to close the third positive “bump” with a tendency to form a moving average death cross. If that happens, there is a good chance that BTC will test the $7,000 resistance one more time. This time with a better chance of breaking through to retest $6,400.
To better understand the ongoings, let’s toom in even more and see what’s happening in the hourly chart.
The 1-hour BTC/USD chart
The first thing that the BitMEX perpetual BTC/USD 1-hour chart reveals is a certain disproportion between the RSI indicator and the price movement. While the price records a positive movement with new short-term highs reached constantly, the RSI doesn’t follow. This may be an announcement of the short-term trend reversal. Especially since we can clearly see that the MACD is about to form another death cross.
While this is definitely a bearish sign, don’t forget that it is only a 1-hour chart that is possibly short-term bearish.
Bitcoin Price Chart – Fibonacci
Now we are back to the 12-hour chart with Fibonacci retracement as our prediction tool of choice. It shows that the 0.618 Fibonacci level currently acts as a resistance. On the other hand, the 0.786 level sits at $5,700 and is close enough to the mentioned $5,600 price to start acting as support. OF course, this is possible only if Bitcoin remains inside the falling wedge formation.
Hence, there are two possible outcomes. The next 24-48 hours will reveal if Bitcoin retains the bearish formation or reverses the trend. Remember, always look for the confirmation no matter the time interval. The crucial candle should close above or below a certain level for the new or the old trend to be confirmed. Therefore, this time, we shall wait for that to happen before analyzing Bitcoin again.
Both scenarios are equally possible.
You should look elsewhere for investment advice since this isn’t it. Even if it looks like it, it’s not. Cryptocurrencies are extremely volatile and risky speculations. Always do your own research. Consider consulting an investment professional prior to investing your money.