Weekly Bitcoin USD chart analysis calendar week 40 – 2021

Bitcoin USD daily basis

Bitcoin USD Chart Analysis - All-Time High Approaching

Bitcoin posted impressive gains during the reporting week, which ultimately lifted the price above the dominant resistance zone in the USD 52.000 area. Already on Monday, a potentially bullish dominated week was announced with the breakout through the 48,000 resistance. Bitcoin last failed in this zone just below the 50'000 mark in mid-September. With a daily close of $49,271, the market showed on Monday that despite the previous week's price surge, there are no signs of fatigue in the recent uptrend. Accordingly, the positive momentum was reinforced on Tuesday with the price closing at USD 51,508. The market was now right at the authoritative resistance zone formed by the price action from mid-February to mid-May. Without a sign of weakness, Bitcoin marched through these resistances on Wednesday and immediately also marked the highest price gain of the week at USD 55.351. A consolidation on Thursday led back to USD 53.783. A daily high of USD 56.074 was used for profit-taking on Friday and brought the price back to USD 54.000 again. At the weekend, price action was registered at a slightly higher level of around USD 55.000 on Saturday. On Sunday, there were further price gains, which brought the price to the zone of USD 56.000.

The moment of truth approaches

Review daily interval

After the price drop in mid-March 2020, a veritable countermovement established itself. This led to the resistance zones above USD 10,000. After an initial rejection and a consolidation phase lasting almost two months, a breakout through the fundamental resistance zone followed on July 27, which had been established since August 2019 and had already caused Bitcoin to fail several times to date.

The resistance zone around USD 10.000 was interesting in several respects. On the one hand, the 0.618 Fibonacci points of the entire downward movement, which was initiated at the end of June 2019 just below 14.000 USD, is located here. On the other hand, the zone around USD 10.000 simultaneously acted as a confirmation of the still bearish trend from lower highs since December 2017 (see the macro view on a weekly basis). Bitcoin was able to establish itself above the newly created support in the USD 10,000 area since the end of July 2020 and provided the first confirmation of a trend reversal with the break of the resistance zone around USD 12-200 towards the end of October 2020. In the following weeks, the positive trend accentuated and led Bitcoin through the 14'000 resistance in early November 2020 and close to the then all-time highs around USD 20.000 for the first time in early December, which remained untouched for 158 weeks since the bull market in 2017.

Since the breakout through the important 14.000 resistance at the beginning of November, it has been blown by blow. The breakout through the old all-time high at USD 20.000 saw a strong accentuation of the uptrend, which saw the bitcoin price mark its new all-time high just below USD 65.000 on April 14. The rapid upward movement was so far characterized by 3 corrections, each of which found its low point around the 50-day average (light blue line). However, the fourth correction led for the first time clearly below it and thus it also came to a violation of the trend line, which has served as support since the beginning of the year, formed by the respective daily lows. In recent weeks, this resulted in an accelerated downward trend, which led to below important support zones. Subsequently, the price consolidated in the corridor USD 30.000 - 40.000 for three months, until the recent breakout from the upper area of the corridor. This leads directly to the resistance zones, which formed between February and May and were breached for the first time during the reporting week.

Outlook

We are above the 11 weeks lasting price corridor of USD 30.000 - 40.000. A "roundig bottom scenario" in the area of the 0.618 Fibonacci points, which is calculated between the start of the rapid uptrend and the new all-time high, has manifested itself in a strong upward movement. The impressive counter-trend came determined and took Bitcoin directly to the 50,000 resistance. An initial failure led back to the 40'000 zone. The bottoming out in this area was followed by the massive countermovement, which continued until the end and led above the prominent resistance zone in the 52'000 area.

The price area above USD 50,000 has repeatedly taken on a determining role since February and was accordingly to be classified as significant resistance. The price action in the reporting week impressively underlined the renewed bullish momentum after the "retest" of the 40'000 zone. A breakthrough at the all-time high is getting closer. The macro picture is still under the sword of Damocles of an establishing "bull trap". If a price correction sets in, it should ideally not fall below USD 52,000 or at the latest the USD 48,000 area, so as not to jeopardize the all-time high mission that has been embarked upon.

New all-time high or bull trap

Review Weekly Interval

Bitcoin was able to set a higher high above USD 10.000 for the first time in the weekly interval in 2020, which broke the prevailing bearish trend since December 2017. This broke the series of lower highs that lasted for 135 weeks (1).

Since this first overcoming of the bearish trend, the signs for a valid trend reversal became stronger. With the push through important resistance zones and a continuous development above the 21-week average (2), the probabilities for a renewed reaching of the all-time high created in 2017/18 increased visibly. This was accomplished in mid-December 2020. This was followed by a strongly accentuated price discovery above this historical mark, which produced a new all-time high of USD 65.000 in mid-April. A consolidation initiated since then ended in a veritable price slide that brought Bitcoin back to the USD 30,000 mark in just two weeks. A subsequent breakout from the 10-week USD 30.000 - 40.000 consolidation area will bring Bitcoin back to the 50,000 resistance.

Outlook

The price movements in the past year created a good foundation to sustainably climb to new spheres beyond the all-time highs reached in 2017. The break of the USD 20.000 mark impressively demonstrated the power of the upward movement that has been established since October. The rapid price increase was abruptly interrupted by a price drop, which even brought Bitcoin below the 21-week average (2) that has defined reliable bull or bear market phases in the past.

Bitcoin was able to overcome the subsequent correction phase in the USD 30.000 - 40.000 zone, which lasted for more than three months. The consolidation took place in the interesting 0.618 Fibonacci area since the start of the bull market. After breaking out of the upper price band of the three-month corridor, a continued significant counter-movement took the price back to the USD 50.000 zone within the past 3 weeks while negating a forming shoulder-head-shoulder formation.

With the holding of the 30.000 support in the 0.618 Fibonacci zones, a scenario of a continuing price development, which eventually leads beyond the existing all-time high, remains intact. Such a scenario is reinforced by a price action above the 40.000 support zone and a sustained recapture of the 21-week moving average. A presumed "make it or break it" situation is emerging in the current price area in the following weeks. Here, the market decides whether a price discovery above the all-time high should take place or whether the current upward movement below the all-time high ends in a "bull trap" as in January 2018.