- Bitcoin’s daily trading volume remains elevated at highs above $10 billion, going against the technical theory that investor interest tends to drop during periods of consolidation. Therefore, the ongoing sideways trading near $3,900 may end with a bull breakout toward the recent high of $4,207.
- Trading volumes have been strong since the corrective rally kicked off in early February, so a range breakdown looks unlikely.
- Prices could first see a drop below $3,865 (March 12 low) due to the extended consolidation. That said, the short-term outlook would turn bearish only if the higher low of $3,743 created on March 3 is breached
Bitcoin’s current period of price consolidation may end with a bull breakout, price-volume analysis indicates.
While the cryptomarket leader is lacking a clear directional bias for the tenth straight day, 24-hour trading volume remains elevated near the 10-month high of $10.75 billion seen on Feb. 24, contradicting the popular theory that investor interest drops in a rangebound market.
As a result, the pullback from recent highs near $4,200 appears likely to be nothing more than a bull breather and BTC could soon draw bids.
Validating that argument is the fact that the recovery rally from the lows near $3,400 seen on Feb. 8 was backed by high volumes. Daily trading levels jumped above their 50-day moving average 35 days ago and have remained above the key metric ever since – a feat last observed during the height of the bull market in the third quarter of 2017, according to CoinMarketCap data.
Hence, the probability of BTC ending the ongoing consolidation with a strong move to the downside is quite low.
As of writing, BTC is trading at $3,930, representing a 0.5 percent gain on a 24-hour basis, according to CoinMarketCap. Twenty-four-hour trading volume is seen at $10.62 billion, while the 50-day moving average of daily trading volume is seen at $7.615 billion.
As seen above, BTC jumped 7.5 percent on Feb. 8 (arrow), invalidating the immediate bearish setup. The strong move was backed by a hike in trading volumes above their 50-day MA. Since then, volume bars have consistently printed above the key average, validating the corrective rally from $3,400.
The setup looks even more bullish if we take into account the higher lows and higher highs on volume chart. Recent price pullbacks were accompanied by a drop in volumes (lack of bear support), explaining the weak follow-through to the rising channel breakdown witnessed on Feb. 24.
The failed breakdown coupled with elevated volumes amid price consolidation indicates scope for a re-test of $4,208 (Feb. 24 high).
That said, the long period of consolidation could test the bulls’ resolve, and a brief drop below the immediate support of $3,865 (March 12 low) could be seen before a continuation of the rally.
Disclosure: The author holds no cryptocurrency assets at the time of writing.
Bitcoin will drop to $3,500 before we see a major bull run, says trader
While Bitcoin has managed to hold above $4,000 according to Coinmarketcap, one trader believes that BTC will drop to $3,500 before the next bull run.
Speaking to CCN, crypto trader known as The Crypto Dog in the community said that it’s still possible Bitcoin sinks to $3,500 in the short term, adding that market conditions haven’t changed over the last several days.
“I think we could still see $35XX,” the trader said, adding, it [Bitcoin] hasn’t changed much. It wasn’t a particularly significant move. It bounced at a clear support, but there’s been no positive reaction yet. If this support holds, I expect a sweep of the highs near $4,100-$4,140.
“Decent chance we just saw that ‘one more leg up.’ I greatly reduced exposure up here above $4,000. Waiting for $3,5XX for long entries. I’d love an opportunity to short $4,1XX, but not sure if we’ll see it,” he said.
Bitcoin’s struggle to maintain momentum is likely the reason for cautious optimism shown by traders and analysts.
Recently, technical analyst knew as DonAlt explained that we can’t safely conclude the bear market is over until Bitcoin breaks out above $4,600.
Bitcoin SV [BSV] Price Analysis: Bears dominate market as token’s downtrend continues
Bitcoin SV [BSV] continued its bearish run on the back of the collective market dropping below the $140 billion mark. After two successive bullish waves in the past week, the coin market turned red.
At press time, the BCH hardfork fell against the US dollar by 1.26 percent, and was trading at $65.88. The market cap of the coin stood at $1.16 billion, trailing Cardano [ADA] by over $220 million.
Bitforex took the top spots with respect to BSV trade volume, via the trading pairs BSV/USDT and BSV/BTC. The pairs accounted for 12.28 and 12.17 percent, respectively. Other notable exchanges on the list were HitBTC, IDAX, and IDCM.
The one-hour BSV chart showed a massive downtrend stretching from $68.71 to $66.32, with the coin dropping further below. The sole uptrend was prior to this drop when the coin rose from $67.71 to $68.71.
Bitcoin SV found immediate support at $64.55, which the coin was hovering above. The immediate resistance level stood at $68.77.
The Bollinger Bands pointed to a massive increase in volatility as the price declined. The Moving Average line indicated a bearish swing.
The Chaikin Money Flow tool showed a decrease in the money inflow to BSV tokens as the CMF line was below 0.
The Awesome Oscillator showed a significant decrease in short term market momentum, but the concluding bars being green indicated an imminent bullish change.
Bitcoin SV saw two downtrends, with the first downtrend shaving the price from $75.71 to $67.15. The second downtrend pulled the price down from $70.39 to $67.65.
The coin found immediate support at $61.72, which the coin touched in February. Bitcoin SV’s immediate resistance level stood at $75.65.
The Parabolic SAR indicated a bearish market, as the dotted lines were above the coin’s trend line.
The Relative Strength Index showed a notable decrease in investor interest as the RSI dropped down from 55.65 to 46.38, at press time.
The MACD continued projecting bearish signs as the MACD line pushed below the Signal line.
Bitcoin SV failed to hold on to the bulls as the coin’s price declined below the $70 mark. In the short term, the coin’s volatility was high, while the money inflow dropped. Short-term momentum was negative, further pointing to the resoluteness of the bears. In the long-term, the MACD and the Parabolic SAR indicated a bearish market.
Bitcoin Price Drops Back Below $4K But Bull Outlook Still Intact
- Bitcoin failed to capitalize on a bull breakout above $4,040 yesterday, but the short-term outlook remains bullish as the higher-lows pattern is still intact.
- A convincing break above the three-day chart resistance of $4,040 still looks likely and could be followed by a rally toward the recent high of $4,190.
- The immediate outlook would turn bearish if prices find acceptance below $3,920 (previous day’s low). A bearish close, if confirmed, could yield a drop to $3,700–$3,658 (Feb. 27 low).
Bitcoin (BTC) has dropped back from levels over $4,000, but the short-term outlook will remain bullish as long as prices are holding above key support at $3,920.
The crypto market leader jumped to a 25-day high of $4,055 yesterday, having secured a bullish UTC close above the psychological hurdle of $4,000 on Wednesday, going by Bitstamp data. The breakout above the crucial three-day chart resistance of $4,040, however, was short-lived with prices falling back to a five-day low of $3,920 before closing the day at $3,974.
Notably, the negative price action engulfed the trading range seen in the previous four days, which is widely considered an early sign of bull exhaustion.
That said, the path of least resistance is still to the higher side, as the bounce from lows near $3,920 has left the bullish higher lows pattern intact along the trendline connecting the Feb. 8 and Mar.4 lows.
For the immediate outlook to turn bearish, the engulfing price action seen yesterday needs a strong follow through in the form of a convincing break below $3,920.
As of writing, BTC is trading at $3,980, representing a 1.28 percent drop on a 24-hour basis.
On the daily chart, BTC created a bearish outside reversal candle yesterday as trading began on an optimistic note but ended with pessimism.
A bullish-to-bearish trend change, however, would be confirmed only if prices close below $3,920 (low of the bearish candle) today. A move below $3,920 would confirm a downside break of the ascending trendline and shift risk in favor of a deeper drop toward the Feb. 27 low of $3,658.
On the higher side, a break above $4,055 would reinforce the short-term bullish setup and could fuel a rally toward the recent high of $4,190.
The odds of a rally toward $4,235 (inverse head-and-shoulders neckline) would strengthen if the current three-day candle closes (today) above $4,040, validating the bullish engulfing candle created in three days to March 16.
Disclosure: The author holds no cryptocurrency assets at the time of writing.