Following our last Bitcoin price analysis three days ago, the coin has marked a clear trading area: resistance around the 2019 high at $9,400, and strong support at $8,800.
Any move outside the above territory will probably dictate Bitcoin’s direction for the next couple of days.
Looking at yesterday’s trading day, we don’t see any unusual excitement following the official announcement of Facebook’s Libra coin.
However, there are clear signs of an upcoming sharp move that should be taking place soon. The first is the fact that Bitcoin’s price has experienced significant volatility over the past 2-3 months, so three consecutive calm days is a very rare sight.
Total Market Cap: $287 billion
Bitcoin Market Cap: $162.8 billion
BTC Dominance: 56.7%
Looking at the 1-day and 4-hour charts:
Support/Resistance: At the time of writing, Bitcoin’s price was hovering around the demand zone at $9,000 – $9,100. If that breaks down, we would expect to approach the next support level at $8,800, along with the daily chart’s lower ascending trend line (marked in orange). Further below lies $8,600 (along with the 4-hour chart’s MA-50, marked in purple), before reaching $8,400, $8,200 – $8,250 and $8,100.
From the bullish side, the nearest resistance zone is at $9,400, which was the 2019 high. As can be seen on the daily chart, this is precisely where our marked middle ascending trend-line was.
Breaking $9,400 would probably lead quickly to a move toward the next resistance level of $9,600 – $9,700, whereas the following resistance level is a five-digit number.
Trading Volume: Over the past three days, the trading volume has been decreasing. This could be related to the anticipated move mentioned above.
Daily chart’s RSI: After reaching a weekly high of 70, the RSI has dropped to 64. That said, it still looks bullish. Looking at the BTC daily chart, the Stochastic RSI oscillator recently exhibited a crossover in overbought territory and is about to enter the bearish zone (under 80), which usually leads to a correction.
Bitfinex open short positions: The open short positions are around their monthly high. This might be a sign of an upcoming move. There are now approximately 25K BTC open short positions.
BTC/USD Bitstamp 4-Hour Chart
BTC/USD Bitstamp 1-Day Chart
Cryptocurrency charts by TradingView. Technical analysis tools by Coinigy.