Bitcoin (BTC) Cannot Fall Below $5,800 Under The Bullish Case

Bitcoin (BTC) has to make a move by next week. The weekly chart for BTC/USD shows that Bitcoin (BTC) is about to close a weekly candle right next to the downtrend resistance. If this candle closes above the downtrend resistance, which is quite likely, we will see the beginning of a new cycle from next week. If this candle closes below the downtrend resistance, it is still possible to see a green candle next week. However, if Bitcoin (BTC) forms a red candle next week, this would shift moment towards the downside. That would mean that Bitcoin (BTC) has faced rejection at the downtrend resistance and will now have to rest $5,800 again. If the price tests $5,800 again, there is a very strong probability that it might break below it.

These are the possibilities, but we are more interested in probabilities. If you look at the weekly RSI on the above chart for BTC/USD, you will that it has been trading in a falling wedge. This is a very bullish development. If the price were to break to the upside, the RSI conditions would totally support it. The same is true of the weekly wave trend for BTC/USD. As the BTC/USD chart shows, the wave trend began to bottom around June and has since been trading in a flat line. If the price were to fall further, it would have already done it by now. It clearly shows that there is no room for a short term price break below $5,800. The only way the price would break and close below $5,800 would be if it were to begin a new trend.

The wave trend between October and December last year was in a similar flat line. It fell only to begin a correction that lasted more than eight months. If the same were to happen again, that would mean the beginning of a correction lasting for another eight months. This would have to invalidate the general trend of October to December being the bullish period for crypto markets. In addition to that, we will have to break below critical levels and break key structures. The moment we formed the monthly candle for October, the possibility of a fall below $5,800 for a bullish case has ceased.  A lot of analysts seem to think the price could just drop to $4,000 and rebound strongly from there. That is not true, at all. Let us examine why.

This is the monthly chart for BTC/USD which as big as the big picture could get. Let us discuss the first observation pertaining to our point from before. If we look at this chart, there are five candles closely above the 21 Month EMA (purple line). For the last four months, these candles have tested the 21 Month EMA but have remained above it. In addition to that, the price of BTC/USD has remained above the 21 EMA since 2016! Looking at this chart, you can see for yourself what a fall below $5,800 would mean. That would be doing something we have not done for the last two years. This is the reason why Bitcoin (BTC) has not done this so far. If the price falls below $5,800, you can kiss any bullish scenario goodbye as the market will be forced to enter another correction.


Source
Author: Fakhan
Image Credit

Bitcoin Price Analysis: BTC/USD Small Reversal Formation

Bitcoin might be ready for an uptrend as it formed a double bottom reversal pattern on its 1-hour chart. This is often seen as a classic uptrend signal, provided that price can break past the neckline around the $6,600 mark.

If so, Bitcoin could climb by around $600 or the same height as the chart pattern. The 100 SMA is above the longer-term 200 SMA to suggest that the path of least resistance is to the upside or that the rally could gain more traction. However, the gap between the two moving averages has narrowed enough to suggest that a downward crossover is imminent. In that case, bearish pressure might still return and lead to another test of the bottoms.

RSI looks prime to head south so Bitcoin price could follow suit as sellers take over while buyers take a break. Stochastic has also just made it out of the overbought region to signal a return in selling pressure. A move below the bottoms could confirm that the longer-term slide is resuming.

A pickup in risk-taking has been observed in the broader financial markets on account of softer-than-expected tariffs from both the US and China. Besides, both these announcements have been hinted at in the past weeks so the bullish moves may also indicate profit-taking. Other altcoins have reported some progress, though, so it’s possible that the positive sentiment is also helping keep bitcoin price afloat.

Looking ahead, it seems that Bitcoin bulls are taking things slow while remaining wary of the SEC ruling on bitcoin ETF applications. It looks like markets are pricing in lower odds of an approval, although there still seem to be signs of hope. An approval is being touted as a potential catalyst that could spur the much-anticipated rebound in bitcoin for the year while rejection could reflect yet another setback.

Source 
Author: Sara Jenn
Image Credit