Bitcoin at crucial decision point
For the last couple of weeks, Bitcoin - BTC has been in a steady uptrend that seems to now be coming to a close. Above us, the 20 weekly MA is closing in and if you take a look at the past few months, it has been a resistance that BTC simply could not pass. On the contrary, during the bull market the 20 weekly has proven to be an extremely strong support and prices bounced off of it every single time. In short, it is a very important MA that demands attention.
On the other hand, we can clearly see that the 200 weekly MA has provided crucial support after the 6k level broke and is now slowly rising, currently being somewhere in the 3400s price range. It goes without saying that it is a very significant average and one that, in fact, has never been broken in all of Bitcoin´s history.
With that being said, both of these moving averages are coming to a cross which means that Bitcoin will HAVE TO make a decision on where it is going next. Sideway movement betveen both of these MAs for the next couple of months is extremely unrealistic as that would mean prices would move move between both MAs, literally in a 200 dollar range or so.
If we excluded sideways movement the question is: up or down?
Unfortunately, the weekly stochastics are signaling a big warning. We are about to have a bearish cross down and if we assume that the prices cannot trade sideways in such a tight range the obvious conclusion is that we are going down. Make no mistake, if 200 weekly MA breaks and price closes below it we are due for a wild ride. This scenario is supported by the fact that we appear to be forming a pennant and in a bear market, guess in which way do these pennants generally break? That´s right, to the downside.
Can we break to the upside? While certainly everything is possible the question is if it is likely? With weekly RSI facing heavy resistance at 40 and stoch RSI having a cross to the downside the answer would be a firm no.
I am going short on this one and will look to buy Bitcoin at sub 2k levels once final capitulation has happened.
P.S. Forgot to wrote, volume is heavily declining, which could indicate that volatile price movements are just around the corner
On the other hand, we can clearly see that the 200 weekly MA has provided crucial support after the 6k level broke and is now slowly rising, currently being somewhere in the 3400s price range. It goes without saying that it is a very significant average and one that, in fact, has never been broken in all of Bitcoin´s history.
With that being said, both of these moving averages are coming to a cross which means that Bitcoin will HAVE TO make a decision on where it is going next. Sideway movement betveen both of these MAs for the next couple of months is extremely unrealistic as that would mean prices would move move between both MAs, literally in a 200 dollar range or so.
If we excluded sideways movement the question is: up or down?
Unfortunately, the weekly stochastics are signaling a big warning. We are about to have a bearish cross down and if we assume that the prices cannot trade sideways in such a tight range the obvious conclusion is that we are going down. Make no mistake, if 200 weekly MA breaks and price closes below it we are due for a wild ride. This scenario is supported by the fact that we appear to be forming a pennant and in a bear market, guess in which way do these pennants generally break? That´s right, to the downside.
Can we break to the upside? While certainly everything is possible the question is if it is likely? With weekly RSI facing heavy resistance at 40 and stoch RSI having a cross to the downside the answer would be a firm no.
I am going short on this one and will look to buy Bitcoin at sub 2k levels once final capitulation has happened.
P.S. Forgot to wrote, volume is heavily declining, which could indicate that volatile price movements are just around the corner
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