technical analysis BTCUSD

Technical analysis of BTCUSD

Bitcoin appears to have stabilised somewhat this week as sentiment has recovered to a degree and there has been no significant fresh negative news. This technical analysis of BTCUSD looks at the daily chart.

High resistance on this chart is the latest achieved high around $63,500, but it’s unlikely that this area could be tested again in the near future unless strong positivity returns suddenly. Low support seems to be slightly below the current area near $35,000; another bounce might be expected if this zone is tested again over the next few days.

Technical indicators on BTCUSD D1


Moving averages give a fairly weak sell signal. The 50 SMA has death crossed the 100 although both remain far above the 200 SMA. Price is now below all three lines. A push back above the 200 SMA might lead to limited further gains, but this doesn’t look like an upward reversal yet.

Price has moved out of oversold this week based on the slow stochastic (15, 5, 5) and Bollinger Bands (50, 0, 2). However, it remains quite close to the zone of selling saturation from the former at about 30. Volumes suggests significantly more selling than buying.

Price action and Fibonacci


Recent price action has been fairly similar to previous corrections although there was initially some challenge to movement lower with 13 May’s doji. Aggressive bulls might expect the formation of an inverted head and shoulders with the neckline around $55,000, but as with any cryptocurrency the reliability of such patterns even after completion leaves much to be desired.

The confluence of the 61.8% zones of both the weekly Fibonacci retracement and the weekly Fibonacci fan has strengthened $35,000 as a zone of support. For now, a close clearly below the 61.8% retracement might be a main signal for more weakness. On the other hand, movement above the 50% retracement might confirm the case for a degree of recovery continuing next week.

Technical analysis of BTCUSD: summary


TA in general presents a picture of comparative stability compared with last week’s decline; however, a strong reversal isn’t favourable for the moment. Key areas to watch are the 200 SMA, the 50% Fibo retracement and of course the psychological zone around $40,000. However, any new changes in sentiment and reactions to news are likely to overshadow the chart.

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