Bitcoin USD daily basis
Bitcoin USD chart analysis - resumption of the parabola
During the reporting week, the phase of price accentuation, which started in the previous week, was consistently continued. Monday saw the continuation of the recent consolidation at the level of 48,000 USD, which was already established the week before. This began to develop after the rapid rise of February 8 and was characterized by higher lows and slightly higher highs, which mostly occurred above 49,000 USD. On Tuesday, the market started a first attempt to advance into higher spheres. This led within the day for the first time above the psychological mark of 50,000 USD and ended the day with a closing price of 49,149 USD. The strength of the market was underpinned by Tuesday's trading action, and consequent follow-through buying on Wednesday steered the price to above 52,000 USD. A short consolidation on Thursday was followed by the biggest gain of the week on Friday, which took Bitcoin to 56'053 USD by the end of the day. This trading pattern was continued to the weekend, i.e. one-day consolidation on Saturday and new highs on Sunday.
Strengthened momentum after a month-long correction phase
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After the price plunge of mid-March 2020, a veritable countermovement established itself. This led to the resistance zones from 10,000 USD. 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 a few times to date.
The resistance zone around USD 10,000 was interesting in several respects. On the one hand, the 0.618 Fibonacci point 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 10,000 USD simultaneously acted as a confirmation of the still bearish trend from lower highs since December 2017 (see macro view on a weekly basis). Bitcoin was able to establish itself above the newly created support in the 10,000 USD area since the end of July 2020 and provided a first confirmation of a trend reversal with the break of the resistance zone around USD 12,200 USD towards the end of October 2020. The aforementioned resistance zone had been effective since January 2018 and served as a zenith for the price several times since then. In the following weeks, the positive trend accentuated and led Bitcoin through the 14,000 USD resistance in early November 2020 and close to the then all-time highs around 20,000 USD 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 blow by blow. The break through the old all-time high at 20,000 USD saw a strong accentuation of the uptrend. The continued parabolic upward movement led to a new all-time high at 42,000 USD on January 8. A subsequent correction brought the price back to the 30,000 USD area. A decisive hold of this level led to a series of higher daily highs and lows. Subsequently, the forming negative chart formation (descending triangle) was broken towards the upside and thus negated. This increased the chances that the previously seen lows just below USD 30,000 already represented the low of the recent correction. Since the break of the old all-time high of January 8, the resumption of the parabolic rise was impressively resumed.
The break of the old all-time high after a month-long consolidation phase on February 8 was a particularly strong technical signal that is fueling the current trend. The market phase is again entering price discovery mode and the speed of the rise is taking on traits of the market environment before the recent correction. From the technical point of view, there are no resistances and the resumed parabola can quickly lead to higher levels. The daily RSI indicator (2) enters the overbought zone at 80. The initiated correction after January 8 took place at an RSI value close to 88.
In case of a correction, the newly formed support zones at around 49'000 USD, respectively 40'000 USD serve as initial indicators of the state of the recent resumption of the parabola that has prevailed since mid-December. In the area of 48'000 USD is also the 0.618 Fibonacci point, which is calculated from the last and the current all-time high. At the latter support around 40'000 USD is meanwhile also the 50 day moving average (light blue line), which was a good indicator in the recent correction.
Macro: New all-time highs
Bitcoin was able to set a higher high above 10,000 USD in the weekly interval for the first time 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 the break of the bearish trend, signs of a valid trend reversal have been building up. 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. This was accomplished in mid-December 2020. Since then, a strongly accentuated price discovery above this mark has been taking place.
With the price movements in the past year, a good foundation was created to sustainably climb new spheres beyond the all-time highs reached in 2017. The break of 20,000 USD impressively demonstrated the power of the upward movement that had been established since October. It resulted in a parabola, which reached its first high at just over 42,000 USD. After a one-month correction, the Bitcoin price was able to continue the upward movement with the break of the old all-time high, bringing Bitcoin once again into price discovery mode in uncharted territory. There are no resistances for the time being.
In case of an incipient correction, respecting the previously created supports (green) over the next weeks/months will be necessary to make the initiated phase of exploration in new price spheres sustainable. What remains to be observed here is the first zone of the one-month march stop around 39,000 USD. In case of a continued correction, the 21-week average (2) becomes relevant, which so far could reliably indicate bull and bear phases. This is currently just below 26,000 USD and rises accordingly quickly. Further support zones in the weekly interval can be found in the area of 20,000 USD.
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