It looks like BTCUSD is showing some signs of reversal from the current downward trend.
On the daily chart (left side), you can see that the price of bitcoin has migrated into a small downward channel that began at the beginning of December potentially forming a bull flag. This can further be seen as a bullish sign of reversal based on reversal bullish divergence showing on MACD (dotted yellow lines) as well as the fact that the price is approaching the 78.6% Fibonacci retracement line from the dip back in May (I generally consider the 78.6% Fibonacci level to be a "reversal level").
Furthermore, on the weekly chart (right side), the uptrend looks to still be in play, showing bullish continuation divergence on RSI (dotted yellow lines) as well as a potential ascending triangle forming if a bounce occurs here (dashed blue lines).
However, I must note that I am somewhat optimistic in this chart based on the fact that I started to draw out this channel and the trend about a month and a half ago after the recovery from the dip in early December and was a result of my noting how reminiscent this dip is of the previous dips we have seen in the upward trends from the past year. That being said, I have drawn two pitch forks on the daily chart showing that the price looks to be slightly outside of the upward trend right now and potentially could head into a downward trend. If that does occur, I caution everyone that the price could head into the downward channel back to near 27K and potentially to 16-22K afterward.
Either way, it looks to be like a key moment is approaching, with a short term potential to continue to dip near 36-37K, but a potential for some price positivity on the horizon soon.
That being said, as always, this is solely my opinion and not in any way meant as financial advice, but please like and comment if you agree or have any thoughts!
On the daily chart (left side), you can see that the price of bitcoin has migrated into a small downward channel that began at the beginning of December potentially forming a bull flag. This can further be seen as a bullish sign of reversal based on reversal bullish divergence showing on MACD (dotted yellow lines) as well as the fact that the price is approaching the 78.6% Fibonacci retracement line from the dip back in May (I generally consider the 78.6% Fibonacci level to be a "reversal level").
Furthermore, on the weekly chart (right side), the uptrend looks to still be in play, showing bullish continuation divergence on RSI (dotted yellow lines) as well as a potential ascending triangle forming if a bounce occurs here (dashed blue lines).
However, I must note that I am somewhat optimistic in this chart based on the fact that I started to draw out this channel and the trend about a month and a half ago after the recovery from the dip in early December and was a result of my noting how reminiscent this dip is of the previous dips we have seen in the upward trends from the past year. That being said, I have drawn two pitch forks on the daily chart showing that the price looks to be slightly outside of the upward trend right now and potentially could head into a downward trend. If that does occur, I caution everyone that the price could head into the downward channel back to near 27K and potentially to 16-22K afterward.
Either way, it looks to be like a key moment is approaching, with a short term potential to continue to dip near 36-37K, but a potential for some price positivity on the horizon soon.
That being said, as always, this is solely my opinion and not in any way meant as financial advice, but please like and comment if you agree or have any thoughts!
Comment:
Things look to be playing out as I had expected so far. However, there was also a bit of a dip as well with regard to stocks (see my previous posts on correlations to SPX and QQQ). Hence, I believe the latest dip could easily be related to the stock market dip, however, as we are in a weekend when markets are closed, I do think it should be interesting to see how the price of bitcoin holds up during the weekend as well as going into next week with what the market might bring. That being said, if the price stays steady or undulates into February to become a head and shoulders pattern, then I think there will still be a good chance for a reversal.