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Recent analysis suggests that $52,000 is the next step for Bitcoin, according to charts.
Bitcoin started 2024 with a bang, as a first-quarter rally propelled the price to a new all-time high around $74,000 in mid-March. Over the next six weeks, bitcoin was noticeably range-bound, oscillating between support around $60,000 and resistance around $72,000. As Bitcoin finally falls below this support level at $60,000 this week, we see even more downside potential before the long-term uptrend resumes. If we look a little deeper into the recent trading range, we can see how recent support around $60,000 lines up with the 38.2% Fibonacci retracement level using the January low and the March high. It is also clear that subsequent highs in late March and early April represent failed attempts to reach a new all-time high. You may also notice the breakdown below an ascending 50-day moving average during the second week of April. Bullish charts tend to stay above an ascending 50-day moving average, while a break below this short-term support gauge can indicate a potential trend reversal. At the start of May, bitcoin made lows and highs, and is now below a descending 50-day moving average. Analysis of price dynamics, using the RSI indicator, shows that Bitcoin has now moved from a bullish phase to a bearish phase. From October 2023 to April 2024, the main price trend coincided with the RSI remaining above the 40 level during pullbacks. We are now seeing a more bearish pattern, with the RSI well below the 60 level during counter-trend rallies. BTC.CM= 1 year Bitcoin mountain, 1 year Where can we expect potential support if the downtrend continues? There appears to be a convergence of support in the $50,000-$52,000 range, including the 61.8% Fibonacci retracement level around $52,000. The 200-day moving average is nearby, and big round numbers like $50,000 and $60,000 have often served as important thresholds for the cryptocurrency. With the latest bitcoin halving now behind us, it’s worth noting that the cryptocurrency often sold off in the month following the halving, but the 12 months following the halving included some of the most bullish rallies in history. So while we remain encouraged by Bitcoin’s long-term situation, the short-term situation indicates that more weakness is likely to come. -David Keller, CMT marketmisbehavior.com DISCLOSURES: (Owns bitcoin) THE ABOVE CONTENT IS SUBJECT TO OUR TERMS AND CONDITIONS AND PRIVACY POLICY. THIS CONTENT IS PROVIDED FOR INFORMATIONAL PURPOSES ONLY AND DOES NOT CONSTITUTE FINANCIAL, INVESTMENT, TAX OR LEGAL ADVICE OR A RECOMMENDATION TO PURCHASE ANY SECURITIES OR OTHER FINANCIAL ASSET. THE CONTENT IS GENERAL IN NATURE AND DOES NOT REFLECT THE UNIQUE PERSONAL CIRCUMSTANCES OF ANY INDIVIDUAL. THE ABOVE CONTENT MAY NOT BE SUITABLE FOR YOUR PARTICULAR CIRCUMSTANCES. BEFORE MAKING ANY FINANCIAL DECISION, YOU SHOULD STRONGLY CONSIDER SEEKING ADVICE FROM YOUR OWN FINANCIAL OR INVESTMENT ADVISOR. Click here for full disclaimer.