Bulls are unwilling to give up yet

In our previous article, we noted that we were growing increasingly bearish on Bitcoin. However, we also said that the short-term trend reversal was not confirmed yet, and we would like to see more developments suggesting the rally’s exhaustion. Ideally (to support a thesis about the trend reversal), we would like to see a bearish crossover between DM+ and DM- on the daily time frame. In addition to that, we would like to see a further decline in MACD (later followed by a crossover below 0 points) and RSI. Then on the weekly time frame, we would want to see MACD start flattening and being unable to break above 0 points. Regarding the price action, we will continue to watch levels at $21 454 (support) and $22 314 (resistance). If the price breaks to the upside, it will be bullish and hint at buyers being unwilling to give up yet (though we will monitor volume closely for signs of a fakeout). Contrarily, a breakout below $21 454 will be bearish. The current setup is displayed in Illustration 1.01.

Illustration 1.01

Illustration 1.01 displays the daily chart of BTCUSD. Two days ago, a breakout below the support took place; however, it quickly became invalidated. Then yesterday, the price broke above the resistance, which again did not last long. Now, the price stays stuck between support and resistance. We will wait for another breakout from this narrow range.

Technical analysis
Daily time frame = Bearish
Weekly time frame = Neutral/Slightly bearish

Please feel free to express your ideas and thoughts in the comment section.

DISCLAIMER: This analysis is not intended to encourage any buying or selling of any particular securities. Furthermore, it should not be a basis for taking any trade action by an individual investor. Therefore, your own due diligence is highly advised before entering a trade.

Trade active:

The price retraced toward the 20-day SMA. We will pay close attention to its ability to hold above the moving average.

Trade active:

On the hourly chart, the bounce was initially accompanied by a bullish growth in volume. However, then it suddenly slumped, which makes us concerned about the sustainability of this small rebound (especially as retracement toward the 20-day and 50-day SMAs tend to represent trend corrections).