Technical analysis of BTCUSD
Bitcoin has been fairly inactive so far this week below the psychological area of $60,000, with the price currently moving around $57,500. The main factors supporting the price, namely very accommodative monetary and fiscal policies around the world, DeFi, Crypto Earn and similar schemes plus higher inflation all remain active. This technical analysis of BTCUSD looks at the daily chart.
Technical indicators on BTCUSD D1
Moving averages continue to give a strong buy signal, with each of the 50, 100 and 200 SMAs successively above slower lines and below the price. The primary area of support from moving averages for the moment is the 50 SMA from Bands from which price has bounced twice so far this year. Below this, the 100-day moving average can be expected to function as a strong support in the absence of a dramatic shift in sentiment.
There is currently no overbought signal from Bollinger Bands (50, 0, 2); however, the slow stochastic (15, 5, 5) at 81 is slightly inside the zone of buying saturation. Volume has generally remained constant in 2021 so far.
Price action and Fibonacci
Momentum has mostly been weak relatively speaking since the latest all-time high on 13 March. The current ascending triangle appears to be close to completion: the traditional signal from this pattern would be ‘buy’, but new entrants at these prices should probably monitor conditions of saturation before committing themselves. Price has been very reluctant to move back above $60,000 since last March, but behaviour within the very small area between this and the latest high could be crucial for movements further ahead.
The 23.6% daily Fibonacci retracement area capped the latest consolidation quite neatly, so one can probably point to this zone as another support if the 50 SMA is broken. Further down, the 38.6% weekly Fibonacci fan could be key because of its confluence with the 100 SMA.
This chart of price against volume for transferable bitcoin displays most prominently a dropoff of volume since late March as it became clearer that another new high immediately was less likely. This is essentially a normal situation and should not be considered a sell signal in itself. Demand to buy the ‘dips’ below $58,000 and $55,000 remained very high for most of March.
Technical analysis of BTCUSD: summary
Overall the technical picture for bitcoin remains highly positive and suggests more gains to come if demand and sentiment don’t change significantly. The trigger for another leg up remains unclear. It might be the completion of the ascending triangle on the daily chart, but equally it is not uncommon for such a pattern to continue for several weeks, especially when there are signs that a trend is losing momentum.
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