Bitcoin (BTC) has now shaken off its 4-week Bullish streak, where from a broader perspective, the Bearish Major still overshadows the major crypto while its fundamental strength hasn’t been great for growth.
On a macro basis, fears of a fall in the BTC price are starting to show up a bit because some well-known investors and traders, see real-world adoption problems that have not yet established confidence, so for traders who read this analysis, we will focus more on the psychology of the market in a technical outlook.
Now, based on data from Coin Market Cap (CMC), BTC has a market capitalization of $126,528,753,798 and a daily trading volume of $37,434,016,534 which still places it as the number one cryptocurrency. Compared to yesterday though, the market capitalization has decreased, but daily volume has increased, indicating that the recent sell-off has been riding on an appetite which is worth watching.
Short Term Technicals
At the time of writing, Bitcoin has been under heavy pressure and is trading within a Bears price structure at $6,860, having fallen out of the Wedge pattern and the Green Validation Zone.
Structurally, we see an opportunity to move lower because these two mappings have been broken out so from our point of view, the price needs more than buying interest to counter this decline (needs fundamental support).
Here we try to describe it in the 2-hour technical chart below:
Based on the image above, as previously described, the Wedge pattern (red line) has signaled an important position after the lower red line is broken.
According to the general view of a Wedge, this represents a better Bearish signal, although we still need to watch out for a retest of the Validation Zone if the Seller loses control today.
The Validation Zone is the main basis for our analysis, so with the current situation, we feel Bearish is more worth anticipating by staying alert to attempts at pullbacks or small corrections.
Long Term Technical
On the other hand, in the longer-term view, Bitcoin is currently in its 5th consecutive Bullish Weekly candle which some leading analysts and traders believe to be a continuation signal for the 6th Bullish candle.
So, to ensure that, we mapped the existence of the Blue Validation Line at $ 7,295, so that how the Weekly candle closes this week, whether above or below the Validation Line, will reflect a trend signal that should be anticipated.
Here we try to break it down in the weekly technical chart below:
From a macro perspective, indeed the Blue Validation Line still holds the potential for a breakout upwards if we stick to the five Bullish Weekly candles. However, readers should not forget, how price action in the short-term scheme, for now still supports the Minor Bearish narrative, so that the opportunity to break the Validation Line can only be expected from whether or not the price is able to form strengthening signals above the Psychic Support level, $ 6,650.
Author: Syofri Ardiyanto
Crypto Enthusiast and Investor