Technical Analysis
Good Morning!
What could be better than TA-Tuesday after the long Easter break?
With all the macro news in TradFi, but also in the crypto space, it makes sense to start with a zoomed out view and then work our way into the shorter time frames.
Bitcoin BTC (daily)
Yes, we are in a bull market, and so far nothing points in the direction of a swift change.
But a potential pattern (called a rising wedge) might be in the process of being built. To be more certain of this, I would need to see three touch points on both legs of the wedge. Additionally, I would need to see decreasing volume on the way up, and a large increase in volume when we break the lower leg of the wedge.
A rising wedge is not a trend reversal pattern. So, my target to the downside is somewhere in the range of $44-50k.
I am also monitoring the derivatives market. Especially the funding rates on perpetual and the term future basis. We have seen a constant widening of the term basis year to date (with BTC price moving from $20k to almost $62k). This is also nicely displayed by the annualised rolling 3mth basis at skew.com:
By the way, there are several good articles and podcasts around that try to explain the nature of that basis and what the drivers are: DM me if you need more info.
Returning now to the basis in terms of my technical chart analysis, I would like to point out that the market is stretched and to me it feels like the market needs a breather or the chance to reset before we print a new ATH.
Now, let's zoom into the 4h chart:
Here we are already seeing some choppiness with the Ichimoku cloud flipping back and forth (bullish/bearish).
What is clearly visible ever since we hit the high of $62k is the strong selling interest in the spot market at the $60k level. Every time we trade up to the $58-59k level, those large sell orders show up on pretty much every exchange.
In terms of the short term, this is the level I watch on the upside in combination with those large sell orders (if they actually get eaten up by the buyers, or if I see them shy away).
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